32-9-124. Prohibitions — required disclosure. (1) A mortgage broker, mortgage lender, mortgage servicer, or mortgage loan originator may not do any of the following:

Terms Used In Montana Code 32-9-124

  • Application: means a request, in any form, for an offer of residential mortgage loan terms or a response to a solicitation of an offer of residential mortgage loan terms and includes the information about the borrower that is customary or necessary in a decision on whether to make such an offer. See Montana Code 32-9-103
  • Bona fide third party: means a person that provides services relative to the origination of a residential mortgage loan. See Montana Code 32-9-103
  • Borrower: means a person seeking a residential mortgage loan or an obligor on a residential mortgage loan. See Montana Code 32-9-103
  • Department: means the department of administration provided for in 2-15-1001, acting through its division of banking and financial institutions. See Montana Code 32-9-103
  • Knowingly: means only a knowledge that the facts exist which bring the act or omission within the provisions of this code. See Montana Code 1-1-204
  • Mortgage: The written agreement pledging property to a creditor as collateral for a loan.
  • Mortgage: means a consensual interest in real property located in Montana, including improvements, securing a debt evidenced by a mortgage, trust indenture, deed of trust, or other lien on real property. See Montana Code 32-9-103
  • Mortgage broker: means an entity that obtains, attempts to obtain, or assists in obtaining a mortgage loan for a borrower from a mortgage lender in return for consideration or in anticipation of consideration or holds itself out as being able to assist a person in obtaining a mortgage loan. See Montana Code 32-9-103
  • Mortgage lender: means an entity that closes a residential mortgage loan, advances funds, offers to advance funds, commits to advancing funds for a mortgage loan applicant, or holds itself out as being able to perform any of those functions. See Montana Code 32-9-103
  • Mortgage loan: A loan made by a lender to a borrower for the financing of real property. Source: OCC
  • Mortgage loan originator: means an individual who for compensation or gain or in the expectation of compensation or gain:

    (i)takes a residential mortgage loan application; or

    (ii)offers or negotiates terms of a residential mortgage loan. See Montana Code 32-9-103

  • Mortgage servicer: means an entity that:

    (a)for forward mortgages:

    (i)engages, for compensation or gain from another or on its own behalf, in the business of receiving any scheduled periodic payment from a borrower pursuant to the terms of a residential mortgage loan, residential mortgage servicing documents, or a residential mortgage servicing contract;

    (ii)meets the definition of servicer in 12 U. See Montana Code 32-9-103

  • NMLS: means a licensing system developed and maintained by the conference of state bank supervisors and the American association of residential mortgage regulators for the registration and licensing of persons providing nondepository financial services. See Montana Code 32-9-103
  • Person: means an individual, sole proprietorship, corporation, company, limited liability company, partnership, limited liability partnership, trust, or association. See Montana Code 32-9-103
  • Public law: A public bill or joint resolution that has passed both chambers and been enacted into law. Public laws have general applicability nationwide.
  • Residential mortgage loan: means a loan primarily for personal, family, or household use secured by a mortgage, deed of trust, or other equivalent consensual security interest on a dwelling or on residential real estate located in Montana. See Montana Code 32-9-103
  • State: when applied to the different parts of the United States, includes the District of Columbia and the territories. See Montana Code 1-1-201
  • Subpoena: A command to a witness to appear and give testimony.
  • Subpoena duces tecum: A command to a witness to produce documents.
  • Willfully: when applied to the intent with which an act is done or omitted, means a purpose or willingness to commit the act or make the omission referred to. See Montana Code 1-1-204

(a)retain original documents owned by the borrower and submitted in connection with the loan application;

(b)directly or indirectly employ any scheme to defraud or mislead a borrower, a mortgage broker, a mortgage lender, a mortgage servicer, or any other person;

(c)make any misrepresentation or deceptive statement in connection with a residential mortgage loan, including but not limited to interest rates, points, costs at closing, or other financing terms or conditions;

(d)fail to pay a bona fide third party within 30 days after recording of the loan closing documents or within 90 days after completion of the bona fide third-party service, whichever is earlier, unless otherwise agreed by the parties;

(e)accept any fees or compensation in excess of those allowed by state or federal law;

(f)sign a borrower’s application or related documents on behalf of or in lieu of another mortgage broker, mortgage lender, or mortgage loan originator;

(g)assist or aid and abet any person in the conduct of business under this part without a valid license as required under this part;

(h)conduct any business covered by the provisions of the Secure and Fair Enforcement for Mortgage Licensing Act, Title V of the Housing and Economic Recovery Act of 2008, Public Law 110-289, without holding a valid license as required under this part;

(i)fail to comply with this part or rules promulgated under this part or fail to comply with any other state or federal laws, including the rules and regulations adopted pursuant to those laws, applicable to any business authorized by or conducted under this part;

(j)fail to account for or deliver to any person any funds, documents, or other thing of value obtained in connection with a mortgage loan that the mortgage broker, mortgage lender, mortgage servicer, or mortgage loan originator is not entitled to retain under the circumstances;

(k)refuse to permit an investigation or examination of the mortgage broker’s, mortgage lender’s, mortgage servicer’s, or mortgage loan originator’s books and records or refuse to comply with a department subpoena or subpoena duces tecum;

(l)knowingly withhold, abstract, remove, mutilate, destroy, alter, or keep secret any books, records, computer records, or other information from the department; or

(m)negligently make any false statement or knowingly and willfully make any omission of material fact in connection with any information or reports filed with a government agency or the NMLS or in connection with any investigation conducted by the department or another governmental agency.

(2)Within 3 business days of taking an application, the mortgage loan originator working for a mortgage broker, in addition to other disclosures required by this part and other state and federal laws, shall provide to the borrower a written disclosure as prescribed by the department by rule.

(3)A mortgage broker or mortgage lender may not accept any fees or compensation that were not disclosed as required by state or federal law.

(4)A mortgage broker or mortgage lender may not charge or receive, directly or indirectly, fees for assisting a borrower in obtaining a mortgage until all of the services that the mortgage broker or mortgage lender has agreed to perform for the borrower are completed.

(5)A mortgage broker or mortgage lender may not charge or receive an amount in excess of the amount allowed by federal law. (See part compiler’s comment regarding contingent suspension.)

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