No. 31968: R162-211. Adjusted License Terms

DAR File No.: 31968
Filed: 09/25/2008, 09:14
Received by: NL

RULE ANALYSIS

Purpose of the rule or reason for the change:

Congress passed the SAFE Mortgage License Act, which became effective on 07/30/2008. It includes significant changes to state-issued mortgage licenses. Utah needs to start adjusting its terms of licensure from a two-year rolling renewal to a one-year calendar renewal. Without this rule, the Division will continue issuing two-year licenses that will likely need to be adjusted part way through the term of licensure. This rule will allow the Division to issue licenses that comply with the Congressional mandate, as well as recognize the full terms of licensure received with a license.

Summary of the rule or change:

The rule transitions all licensees onto a one-year calendar license renewal cycle by adjusting terms of licensure to be more or less than two years, in accordance with the authority granted under Subsection 61-2c-205(1). By taking 27 months to transition, the Division will be causing the least amount of impact on mortgage licensees. Most existing and many new licensees will be granted a license term beyond 2 years, while some new licensees will be granted a license between 12 and 24 months, rather than a full 24 months.

State statutory or constitutional authorization for this rule:

Subsection 61-2c-205(1)(b)

Anticipated cost or savings to:

the state budget:

There will be minimal costs to the state budget since the fee amounts will not be changed. Most licensees will gain a slightly extended term of licensure for no additional fee, while others will experience a shortened term of licensure for the same fee cost.

local governments:

Local governments will experience no cost or savings to implement this act because they do not pay mortgage licensing fees.

small businesses and persons other than businesses:

Small mortgage companies should recognize a cost savings, since the average licensee will gain a slightly longer term of licensure than is currently granted for the existing fee.

Compliance costs for affected persons:

There will be minimal compliance costs since the average licensee will see an extension of a term of licensure without any additional fee.

Comments by the department head on the fiscal impact the rule may have on businesses:

No fiscal impact to businesses is anticipated by this rule filing beyond those addressed by Congress in passing the SAFE Mortgage Licensing Act, and as indicated in the rule summary. Francine Giani, Executive Director

Emergency rule reason and justification:

Regular rulemaking procedures would place the agency in violation of federal or state law.

As stated above, Congress passed legislation that requires an annual renewal. Every two-year rolling license the Division issues currently will be in violation of the Congressional act when the license expires in two years. The Division needs to stop issuing licenses with the pretense they will be good for two years.

The full text of this rule may be inspected, during regular business hours, at the Division of Administrative Rules, or at:

Commerce
Real Estate
HEBER M WELLS BLDG
160 E 300 S
SALT LAKE CITY UT 84111-2316

Direct questions regarding this rule to:

Mark Steinagel at the above address, by phone at 801-530-6744, by FAX at 801-530-6749, or by Internet E-mail at [e-mail]

Interested persons may present their views on this rule by submitting written comments to the address above no later than 5:00 p.m. on:

This rule is effective on:

10/01/2008

Authorized by:

Mark Steinagel, Director

RULE TEXT

R162. Commerce, Real Estate.

R162-211. Adjusted License Terms.

R162-211-1. Adjusted License Terms to Comply with Nationwide Mortgage Licensing System.

(1) Notwithstanding other provisions in Title R162, Rules R162-201 through R162-210, licensing terms for a license issued under the authority of Title 61, Chapter 2c, and rules made by the Division shall be adjusted according to the following schedule:

(a)(i) An applicant for license renewal whose license expires between January 1, 2008, and December 31, 2008, and who applies for and qualifies for renewal under Title 61, Chapter 2c, and rules made by the Division shall be issued a license for a term that expires December 31, 2010.

(ii) The Division shall issue a new license with the updated expiration date to a licensee who renewed a mortgage license during 2008 prior to the enactment of this rule.

(b)(i) An applicant for license renewal whose license expires between January 1, 2009, and November 30, 2009, shall be granted a license extension in accordance with Subsection (2) for a term that expires December 31, 2009.

(ii) An applicant for license renewal whose license expires December 31, 2009, shall comply with the procedures for licensure under Title 61, Chapter 2c, and rules made by the Division including registration with the Nationwide Mortgage Licensing System and Registry.

(c) An applicant for licensure who applies for licensure between January 1, 2009, and December 31, 2009, and who qualifies for licensure under Title 61, Chapter 2c, and rules made by the Division shall be issued a license for a term that expires December 31, 2010.

(d) An applicant for licensure who applies for licensure between January 1, 2010, and December 31, 2010, shall comply with the procedures for licensure under Title 61, Chapter 2c, and rules made by the Division including registration with the Nationwide Mortgage Licensing System and Registry.

(2)(a) An applicant for license extension under Subsection (1)(b) shall be granted an extension if the applicant:

(i) completes the continuing education required for license renewal under R162-208; and

(ii) completes an application for extension provided by the Division.

(b) If permitted under federal and state law in effect at the time of renewal, the Division may permit a licensee who complies with Subsection (2)(a)(i) to apply the same courses used at the time of license extension to the licensee's December 31, 2009, license renewal.

(c) An applicant for license extension will not be required to pay a renewal or extension fee.

(d) A licensee who fails to complete an application for license extension under Subsections (2)(a)(ii) shall be subject to expiration and reinstatement procedures established in Section 61-2c-205.

 

KEY: mortgage renewal license term

Date of Enactment or Last Substantive Amendment: October 1, 2008

Authorizing, and Implemented or Interpreted Law: 61-2c-205(1)(b)