No. 29519 (Amendment): R162-207. License Renewal

DAR File No.: 29519
Filed: 02/15/2007, 08:31
Received by: NL

RULE ANALYSIS

Purpose of the rule or reason for the change:

It is necessary to update the rule to conform with statutory changes made by S.B. 178 (2004 General Session) and S.B. 172 (2005 General Session), which replaced the concept of an unlicensed "control person" of a licensed mortgage entity with a licensed "principal lending manager" effective 05/01/2006. (DAR NOTES: S.B. 178 (2004) is found at Chapter 297, Laws of Utah 2004, and was effective 05/03/2004. S.B. 172 (2005) is found at Chapter 199, Laws of Utah 2005, and was effective 05/02/2005.)

Summary of the rule or change:

The rule is changed to delete references to "control person" and to substitute "principal lending manager" where applicable. Changes are also made to Subsection R162-207-2(207.2.2) to make them correspond more closely with Section 61-2c-203. Subsections R162-207-1(207.1.1) and R162-207-2(207.2) are also deleted because the passage of time has made those subsections unnecessary.

State statutory or constitutional authorization for this rule:

Subsection 61-2c-103(3)(a)(i)

Anticipated cost or savings to:

the state budget:

Any cost or savings to the state budget are attributable to the requirements of Section 61-2c-203, and to the statutory changes made by S.B. 178 (2004) and S.B. 172 (2005), and not to these rule changes implementing those requirements.

local governments:

Any cost or savings to local governments are attributable to the requirements of Section 61-2c-203, and to the statutory changes made by S.B. 178 (2004) and S.B. 172 (2005), and not to these rule changes implementing those requirements.

other persons:

Any cost or savings to other persons are attributable to the requirements of Section 61-2c-203, and to the statutory changes made by S.B. 178 (2004) and S.B. 172 (2005), and not to these rule changes implementing those requirements.

Compliance costs for affected persons:

The only persons who are affected by these rule changes are mortgage entities and their officers, directors, etc., those persons who were formerly "control persons," and those persons who are "principal lending managers." However, any costs incurred by these parties in complying with these rule changes are attributable to the requirements of Section 61-2c-203, and to the statutory changes made by S.B. 178 (2004) and S.B. 172 (2005), and not to these rule changes implementing those requirements.

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

This rule filing updates the rules to comply with recent statutory changes (i.e., references to principal lending managers), removes unnecessary provisions and makes some technical clarifying amendments. No fiscal impact to businesses is anticipated as a result of this rule filing. Francine A. Giani, Executive Director

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:

Shelley Wismer at the above address, by phone at 801-366-0145, by FAX at 801-366-0315, 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:

04/02/2007

This rule may become effective on:

04/10/2007

Authorized by:

Derek Miller, Director

RULE TEXT

R162. Commerce, Real Estate.

R162-207. License Renewal.

R162-207-1. License Renewal.

207.1 Renewal period. [Registrations and l]Licenses issued under the Utah Residential Mortgage Practices Act are valid for a period of two years.[

207.1.1 Notwithstanding Section 207.1, an individual license shall be inactivated by the division on January 1, 2005 if the holder of that license has not by that date submitted proof to the division of having passed the examination required by Section 61-2c-202(4)(a)(i)(C). The holder of a license that has been inactivated under this section may not engage in the business of residential mortgage loans for which licensure under this chapter is required until the individual has provided to the division any forms required by the division to activate the license, along with proof of having passed the examination required by Section 61-2c-202(4)(a)(i)(C).]

 

[R162-207-2. Renewal of Converted Licenses.

207.2 If an individual whose existing registration was converted by the division to a license pursuant to R162-202.6 applies to renew after January 1, 2004, but before January 1, 2005, the division shall renew the license without requiring proof that the individual has passed the examination required by Section 61-2c-202(4)(a)(i)(C). The renewed license issued under the authority of this section shall be issued subject to Section 61-2c-202(4)(a)(ii).

 

]R162-207-[3]2. Renewal Process.

207.[3]2.1 Renewal Notice. A license renewal notice shall be sent by the Division to the licensee at the mailing address shown on Division records. The renewal notice shall specify the requirements for renewal and shall require that the licensee document or certify that the requirements have been met. The licensee must apply to renew and pay all applicable fees on or before the expiration date shown on the notice.

207.[3]2.2 Application for Renewal. All applications for renewal must be made in the form required by the division and shall include the following:

(a) A licensure statement in the form required by the division;

(b) The renewal fee and the Residential Mortgage Loan Education, Research, and Recovery Fund fee;

(c) If the applicant is an individual, proof [using forms]through means approved by the division of having completed during the two years prior to application the continuing education required by the commission under Section 61-2c-104;

(d) The current home street address and home telephone number of any individual applicant [or control person of an entity applicant]and the current physical street address of any entity applicant;

(e) A current mailing address for the applicant;

(f) Answers to a "Licensing Questionnaire" supplying information about events that occurred in the preceding two years related to mortgage licensure in other jurisdictions, license sanctions or surrenders, pending disciplinary actions, pending investigations, criminal convictions or pleas, and/or civil judgments or findings based on fraud, misrepresentation, or deceit;

(g) If, at the time of application for renewal, an individual applicant, or [a control person]the principal lending manager, director, executive officer, manager, or a managing partner of an entity applicant, or anyone who occupies a position or performs functions similar to a director, executive officer, manager or managing partner of an entity that has applied for a license, is charged with, or since the last renewal has been convicted of or entered a plea to, any felony or misdemeanor, the following information must be provided on each conviction, plea, or charge: the charging document, the case docket, and the judgment and sentencing document, if applicable; and

(h) If, in the two years preceding application for renewal, an individual or entity applicant or [a control person]principal lending manager of an entity applicant has had a license or registration suspended, revoked, surrendered, canceled or denied based on misconduct in a professional capacity that relates to good moral character or the competency to transact the business of residential mortgage loans, the applicant must provide the documents stating the sanction taken against the license or registration and the reasons therefore.

207.[3]2.3 Continuing Education Requirement. All active licensees are required to have completed their continuing education requirement prior to applying to renew.

207.[3]2.3.1 Documentation of Continuing Education. Any licensee who renews online and certifies that the required continuing education has been completed shall maintain the original course completion certificates supporting that certification for two years following renewal. The licensee shall produce those certificates for audit upon request by the Division.

207.[3]2.3.2 Out of State Courses. Continuing education credit will be given for a course taken in another state provided the course has been certified for continuing education purposes by the licensing agency in the other state and the subject matter of the course relates to protection of the public, but not to state-specific licensing laws. Evidence must be retained by the licensee, and provided to the Division upon request, that the course was certified by the other state at the time the course was taken.

207.[3]2.3.3 Continuing Education Requirement upon activation of license. As a condition for the activation of an inactive license that was on inactive status at the time of the licensee's most recent renewal, the licensee shall supply the Division with proof of successful completion of the number of hours of continuing education that would have been required to renew had the license been on active status at the time of the licensee's most recent renewal. To qualify as continuing education for activation, all continuing education hours submitted must have been completed within twenty-four months prior to applying to activate.

207.[3]2.4 Late Renewal. If all required renewal forms, fees, and documentation have not been received or postmarked by the expiration date of the license, the license shall expire. When an active license expires, an individual licensee's affiliation with a licensed entity automatically terminates.

207.[3]2.4.1 A licensee may apply to renew an expired license within thirty days after the expiration date of the license by completing all of the renewal requirements, including the continuing education requirement, and paying a non-refundable late fee.

207.[3]2.4.2 After the thirty day period, and until six months after the expiration date of the license, a licensee may apply to reinstate a license by completing all of the renewal requirements, including the continuing education requirement, paying a non-refundable late fee, and providing proof of successful completion of 12 hours of continuing education in addition to that required for a timely renewal on active status.

 

R162-207-[4]3. Current Entity Name Registration.

207.[4]3 An entity submitting an application for renewal must at the time of application have a name registration with the Utah Division of Corporations that is current and in good standing. The division will not process an application for renewal unless it can verify that the applicant's name registration is current and in good standing.

 

R162-207-[5]4. Incomplete Application.

207.[5]4 If an applicant makes a good faith attempt to submit a completed application for renewal prior to the expiration date of the applicant's current registration or license, but the application is incomplete, the Division may grant an extension for a period not to exceed 30 days to enable the applicant to provide the missing documents or information necessary to complete the application.

 

R162-207-[6]5. Nonrefundable Fees.

207.[6]5 All fees required in conjunction with an application for renewal are nonrefundable and will not be refunded if the applicant fails to complete an application or if a completed application is denied for failure to meet the renewal criteria.

 

R162-207-[7]6. Determining Fitness for Renewal.

207.[7]6 The commission and the division shall determine fitness for renewal in accordance with Section 202.5 above.

 

R162-207-[8]7. Applications Filed by Mail.

207.[8]7 The Division will consider a properly completed application for renewal that has been postmarked on or before the expiration date shown on the renewal notice to have been timely filed.

 

R162-207-[9]8. Misrepresentation on an Application.

207.[9]8 Any misrepresentation in an application for renewal, regardless of whether the application is filed with the Division by mail or made online, will be considered a separate violation of these rules and grounds for disciplinary action against the licensee.

 

R162-207-[10]9. Exemption from Continuing Education Requirement.

207.[10]9 A licensee may obtain an exemption from the continuing education requirement of R162-208.1 for a period not to exceed four years upon a finding by the Division that there is reasonable cause to grant the exemption.

207.[10]9.1 Exemptions from the continuing education requirement may be granted for reasons including military service, prolonged absence from Utah for religious or secular service, and extended or serious illness.

207.[10]9.2 A licensee seeking an exemption from the continuing education requirement shall apply to the Division for an exemption. An application for an exemption from the continuing education requirement shall set forth with specificity the reasons why the licensee is unable to complete the continuing education and the reasons why the licensee believes that an exemption would be reasonable.

207.[10]9.3 A licensee may not seek a retroactive exemption by applying for the exemption after the time period for renewal and reinstatement of a license has already passed.

207.[10]9.4 All applications for an exemption shall be considered in an informal proceeding before the Division Director or his designee and shall be based on the information submitted with the application. No hearing will be permitted.

207.[10]9.5 Upon a finding of reasonable cause, the Division shall grant the exemption from the continuing education requirement for a specified period of time, not to exceed four years.

 

KEY: residential mortgage loan origination

Date of Enactment or Last Substantive Amendment: [March 9, 2006]2007

Authorizing, and Implemented or Interpreted Law: 61-2c-103(3); 61-2c-202(4)(a)(ii)