No. 31004 (Amendment): R162-210-4. Rules of Conduct for Certified Schools

DAR File No.: 31004
Filed: 02/15/2008, 02:19
Received by: NL

RULE ANALYSIS

Purpose of the rule or reason for the change:

The purpose of this amendment is to require certified schools to provide written disclosure to a prospective student that the student must disclose any criminal history by answering a questionnaire as part of a prelicensing exam; submit fingerprint cards to the division; consent to a criminal background check and that licenses are conditional pending the completion of a criminal background check and that failure to accurately disclose a criminal history will result in an immediate and automatic license revocation. Applicants with a criminal history other than as described in Subsection R162-202-5(202.5.1) will be considered on a case-by-case basis and may be required to appear at an administrative hearing.

Summary of the rule or change:

This amendment requires certified schools to provide information to prospective students that criminal history must be disclosed as part of a prelicensing exam and that failure to disclose criminal history will result in automatic revocation and that applicants with criminal history other than as described in Section R162-202-5(202.5.1) will be considered on a case-by-case basis and may be required to appear at an administrative hearing.

State statutory or constitutional authorization for this rule:

Subsection 61-2c-103(6)

Anticipated cost or savings to:

the state budget:

None--The proposed amendment has no impact on the state budget because the state makes no expenditure in clarifying disclosures to be made by mortgage education schools.

local governments:

None--Rules made regarding disclosures made by certified mortgage education schools have no impact on local governments.

small businesses and persons other than businesses:

The only small businesses affected by clarifying disclosure requirements are mortgage schools, certified by the state to provide prelicensing education. Schools are currently required to make disclosures to students regarding the ability to get a license and this rule clarifies what disclosures are required. Because disclosures are already required and this rule clarifies those disclosures, this rule will have no cost impact on mortgage schools.

Compliance costs for affected persons:

As explained under "Small Businesses" above, there will be no compliance cost for making disclosures.

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, which established additional disclosures to be made by certified schools. Francine 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:

Laurie Noda at the above address, by phone at 801-366-0328, 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:

03/31/2008

This rule may become effective on:

04/07/2008

Authorized by:

Mark Steinagel, Director

RULE TEXT

R162. Commerce, Real Estate.

R162-210. Certification of Prelicensing Education Providers.

R162-210-4. Rules of Conduct for Certified Schools.

210.4.1 A school shall teach the approved course of study as outlined in the Standard Course Outline approved by the Utah Residential Mortgage Regulatory Commission.

210.4.2 A school shall require each student to attend the required number of hours.

210.4.3 A school shall maintain a record of each student's attendance for a minimum of five years after enrollment.

210.4.4 A school shall not accept a student for a number of hours that is less than the full prelicensing curriculum without first having a written statement from the Division indicating the exact number of hours that an applicant for licensure by reciprocity is required by the Division to complete.

210.4.5 A school shall not make any misrepresentation in its advertising about any course of instruction, and shall be able to provide substantiation of any claims made in its advertising. School advertising and public notices shall not denigrate the mortgage profession and shall not make disparaging remarks about a competitor's services or methods of operation.

210.4.6 Guest Lecturers. No more than 20% of the required prelicensing education hours may be provided by guest lecturers. Guest lecturers shall be experts in the field on which they provide instruction. Prior to using any guest lecturer, a certified school shall provide to the Division the name of the guest lecturer and a resume which defines the knowledge and expertise of the guest lecturer, or other evidence of professional qualifications of the guest lecturer.

210.4.7 Minimum class time. A school shall not give a student credit for more credit hours of education than the student has actually completed. A credit hour is defined as 50 minutes of instruction within a 60 minute time period. A 10 minute break will be given for each 50 minutes of instruction.

210.4.8 Maximum class hours per day. Education credit will be limited to a maximum of eight credit hours per day.

210.4.9 Limitation on Non-lecture Methods of Instruction. Absent special approval from the Division: (a) Non-lecture methods of instruction will be limited to 50% of the total credit hours of the prelicensing curriculum; (b) Non-lecture methods of instruction will have an accompanying workbook for the student to complete during the instruction. The schools shall submit copies of the workbooks to the Division prior to using a non-lecture method of instruction; and (c) A school must have a certified instructor available to answer student questions within 48 hours after a non-lecture method of instruction has been used.

210.4.10 Proof of Course Integrity for Distance Education Courses. Distance education courses will be reviewed on a case by case basis and will be approved only if, in the opinion of the Division, assurance of the following can be provided: a) There is a method to insure that the person actually completing the course is the student who is to receive credit for the course; b) The course provides no fewer hours of actual instruction than the number of credit hours that will be granted for the course; and c) There is a method to insure that the student comprehends the material.

210.4.11 Challenge by Examination. A student cannot challenge a course or any part of a course of study by examination in lieu of attendance at the course.

210.4.12 College Credit Hour Equivalents. A college or a university that provides Division-approved prelicensing education courses may schedule those courses within its regular quarter or semester schedule. A college quarter hour credit is the equivalent of 10 classroom hours of prelicensing education, and a college semester hour credit is the equivalent of 15 classroom hours of prelicensing education.

210.4.13 Within 15 calendar days after the occurrence of any material change in the information provided in the school's application for certification, the school shall give the Division written notice of that change.

210.4.14 A school shall not attempt by any means to obtain or to use in its educational offerings the questions from the prelicensing examination unless the questions have been dropped from the current bank of exam questions.

210.4.15 A school shall not give any valuable consideration to an individual or entity licensed with the Division under the Utah Residential Mortgage Practices Act for having referred students to the school, nor shall a school accept valuable consideration from an individual or entity licensed with the Division under the Utah Residential Mortgage Practices Act for having referred students to a licensed mortgage entity.

210.4.16 Licensed mortgage entities may be permitted by a school to solicit prospective mortgage officers at the school, provided that no solicitation may be made during the class time or the 10-minute breaks that are permitted during every hour of instruction. Such solicitation may be made only after the regularly scheduled class time has concluded. No student may be required to attend any such solicitation.

210.4.17 A school shall use only certified instructors or guest lecturers. The school shall notify the Division about which class sessions the guest lecturers will teach.

210.4.18 A school's owners and directors shall be responsible for the quality of instruction in the school and for adherence to the state laws and regulations regarding school and instructor certification.

210.4.19 School directors shall provide the instructor for each course with the required content outline for the course and shall assure that the required subject matter has been taught.

210.4.20 Disclosure Requirements Regarding Criminal History. For the purposes of this rule, criminal history is defined as any felony or misdemeanor convictions, any pleas in abeyance or diversion agreements, or any pending criminal charges.

210.4.20.1 Prior to accepting payment from a prospective student for a pre-licensing education course, a certified school shall provide a written disclosure to the prospective student stating: a) applicants for licensure must disclose any criminal history by answering a questionnaire as part of the mortgage exam; b) applicants for licensure must submit fingerprint cards to the Division and consent to a criminal background check; c) licenses issued by the Division are conditional pending the completion of the background check and failure to accurately disclose a criminal history will result in an immediate and automatic license revocation; d) applicants with a criminal history described in Subsection R162-202-5(202.5.1) do not qualify for a license; and e) applicants with a criminal history other than as described in Subsection R162-202-5(202.5.1) will be considered on a case-by-case basis and may be required to appear at an administrative hearing to determine qualifications for licensure.[Prior to accepting payment from a prospective student for a pre-licensing education course, a certified school shall provide a written disclosure to the prospective student stating that: a) a student with a criminal history may not qualify for a license; b) an applicant with a criminal history may be required to appear at a hearing before the Utah Residential Mortgage Regulatory Commission and the Director of the Division of Real Estate to obtain approval to license in light of the criminal history, and there is no guarantee that such an applicant will be approved; and c) all applicants for licensure will be required to submit to the Division with their applications fingerprint cards that will be used in criminal background checks.]

210.4.20.2 The school shall be required to obtain the student's signature on the written disclosure required by Section 210.4.20.1 acknowledging receipt of the disclosure. The disclosure form and acknowledgement shall be retained in the school's records and made available for inspection by the Division for a minimum of two years following the date upon which the student completes the pre-licensing course.

 

KEY: residential mortgage loan origination

Date of Enactment or Last Substantive Amendment: [November 3, 2004]2008

Authorizing, and Implemented or Interpreted Law: 61-2c-103(6)