2018 Code of Virginia
Title 6.2 - Financial Institutions and Services
Chapter 16 - Mortgage Lenders and Mortgage Brokers
§ 6.2-1616. Other prohibitions applicable to mortgage brokers
A. As used in this section, "person affiliated," when used with reference to another person, means (i) any person who is a subsidiary, stockholder, partner, trustee, director, officer or employee of the other person or (ii) any corporation 10 percent or more of the capital stock of which is owned by the other person or by any person who is a subsidiary, stockholder, partner, trustee, director, officer, or employee of the other person.
B. No mortgage broker required to be licensed under this chapter shall:
1. Except for documented costs of credit reports and appraisals, receive compensation from a borrower until a written commitment to make a mortgage loan is given to the borrower by a mortgage lender;
2. Receive compensation from a mortgage lender of which he is a principal, partner, trustee, director, officer, or employee;
3. Receive compensation from a borrower in connection with any mortgage loan transaction in which he is the lender or a principal, partner, trustee, director, or officer of the lender;
4. Receive compensation from a borrower other than that specified in a written agreement signed by the borrower;
5. Receive compensation for negotiating, placing or finding a mortgage loan where such mortgage broker, or any person affiliated with the mortgage broker, has otherwise acted as a real estate broker, agent or salesman in connection with the sale of the real estate which secures the mortgage loan and such mortgage broker or person affiliated with the mortgage broker has received or will receive any other compensation or thing of value from the lender, borrower, seller or any other person, unless the borrower is given the following notice in writing at the time the mortgage broker services are first offered to the borrower:
WE HAVE OFFERED TO ASSIST YOU IN OBTAINING A MORTGAGE LOAN. IF WE ARE SUCCESSFUL IN OBTAINING A LOAN FOR YOU, WE WILL CHARGE AND COLLECT FROM YOU A FEE OF % OF THE LOAN AMOUNT.
WE DO NOT REPRESENT ALL OF THE LENDERS IN THE MARKET AND THE LENDERS WE DO REPRESENT MAY NOT OFFER THE LOWEST INTEREST RATES OR BEST TERMS AVAILABLE TO YOU. YOU ARE FREE TO SEEK A LOAN WITHOUT OUR ASSISTANCE, IN WHICH EVENT YOU WILL NOT BE REQUIRED TO PAY US A FEE FOR THAT SERVICE.
IF YOU ARE A MEMBER OF A CREDIT UNION YOU SHOULD COMPARE OUR INTEREST RATES AND TERMS WITH THE MORTGAGE LOANS AVAILABLE THROUGH YOUR CREDIT UNION.
The foregoing notice shall be in at least 10-point type and the prospective borrower shall acknowledge receipt of the written notice; or
6. Fail to use reasonable skill, care, and diligence in exercising the broker's duty, which duty is hereby created, to make reasonable efforts to secure a mortgage loan that is in the best interests of the applicant, considering the applicant's circumstances and loan characteristics, including but not limited to the product type, rates, charges, and repayment terms of the loan.
C. Notwithstanding the provisions of subdivision B 5, no person shall act as a mortgage broker in connection with any real estate sales transaction in which such person, or any person affiliated with such person, has acted as a real estate broker, agent, or salesman and has received or will receive compensation in connection with such transaction, unless such person was regularly engaged in acting as a mortgage broker in the Commonwealth as of February 25, 1989.
1987, c. 596, § 6.1-422; 1989, c. 667; 1993, c. 183; 1997, c. 228; 2001, cc. 502, 511; 2009, cc. 189, 261; 2010, c. 794.