Balloon payment: means a required payment in a mortgage transaction that:
(i)
results in a greater reduction in the principle of the mortgage than a regular installment payment; and
(ii)
is made during or at the end of the term of the loan. See Utah Code 61-2c-102
Business of residential mortgage loans: means for compensation or in the expectation of compensation to:
(A)
engage in an act that makes an individual a mortgage loan originator;
(B)
make or originate a residential mortgage loan;
(C)
directly or indirectly solicit a residential mortgage loan for another;
(D)
unless exempt under Section 61-2c-105 or excluded under Subsection (1)(i)(ii), render services related to the origination of a residential mortgage loan including:
(I)
preparing a loan package;
(II)
communicating with the borrower or lender;
(III)
advising on a loan term;
(IV)
receiving, collecting, or distributing information common for the processing or underwriting of a loan in the mortgage industry; or
(V)
communicating with a consumer to obtain information necessary for the processing or underwriting of a residential mortgage loan; or
that does not permit additional borrowing secured by the same collateral. See Utah Code 61-2c-102
Community development financial institution: means the same as that term is defined in 12 U. See Utah Code 61-2c-102
Compensation: means anything of economic value that is paid, loaned, granted, given, donated, or transferred to an individual or entity for or in consideration of:
Complaint: A written statement by the plaintiff stating the wrongs allegedly committed by the defendant.
Corporation: A legal entity owned by the holders of shares of stock that have been issued, and that can own, receive, and transfer property, and carry on business in its own name.
Deed: The legal instrument used to transfer title in real property from one person to another.
Depository institution: means the same as that term is defined in Section 7-1-103. See Utah Code 61-2c-102
Dwelling: means a residential structure attached to real property that contains one to four family units including any of the following if used as a residence:
Federal Deposit Insurance Corporation: A government corporation that insures the deposits of all national and state banks that are members of the Federal Reserve System. Source: OCC
Fiduciary: A trustee, executor, or administrator.
Lien: A claim against real or personal property in satisfaction of a debt.
Loan modification assistance: means , for compensation or with the expectation of receiving valuable consideration, to:
(i)
act, or offer to act, on behalf of a person to:
(A)
obtain a loan term of a residential mortgage loan that is different from an existing loan term including:
(I)
an increase or decrease in an interest rate;
(II)
a change to the type of interest rate;
(III)
an increase or decrease in the principal amount of the residential mortgage loan;
(IV)
a change in the number of required period payments;
(V)
an addition of collateral;
(VI)
a change to, or addition of, a prepayment penalty;
(VII)
an addition of a cosigner; or
(VIII)
a change in persons obligated under the existing residential mortgage loan; or
(B)
substitute a new residential mortgage loan for an existing residential mortgage loan; or
(ii)
as an employee or agent of another person:
(A)
solicit, or offer that the other person will engage in an act described in Subsection (1)(ff)(i); or
(B)
negotiate terms in relationship to an act described in Subsection (1)(ff)(i). See Utah Code 61-2c-102
Mortgage: The written agreement pledging property to a creditor as collateral for a loan.
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 in expectation of compensation:
(A)
(I)
takes a residential mortgage loan application;
(II)
offers or negotiates terms of a residential mortgage loan for the purpose of:
(Aa)
a purchase;
(Bb)
a refinance;
(Cc)
a loan modification assistance; or
(Dd)
a foreclosure rescue; or
(III)
directly or indirectly solicits a residential mortgage loan for another person; and
(B)
is licensed as a mortgage loan originator in accordance with this chapter. See Utah Code 61-2c-102
National Credit Union Administration: The federal regulatory agency that charters and supervises federal credit unions. (NCUA also administers the National Credit Union Share Insurance Fund, which insures the deposits of federal credit unions.) Source: OCC
Obligation: An order placed, contract awarded, service received, or similar transaction during a given period that will require payments during the same or a future period.
United States: includes each state, district, and territory of the United States of America. See Utah Code 68-3-12.5
(a)
Except as to an individual who will engage in an activity as a mortgage loan originator, this chapter applies to a closed-endresidential mortgage loan secured by a first lien or equivalent security interest on a dwelling.
an agency of or entity created by a governmental entity described in Subsections (2)(a) through (c) including:
(i)
the Utah Housing Corporation created in Section 63H-8-201;
(ii)
the Federal National Mortgage Corporation;
(iii)
the Federal Home Loan Mortgage Corporation;
(iv)
the Federal Deposit Insurance Corporation;
(v)
the Resolution Trust Corporation;
(vi)
the Government National Mortgage Association;
(vii)
the Federal Housing Administration;
(viii)
the National Credit Union Administration;
(ix)
the Farmers Home Administration; and
(x)
the United States Department of Veterans Affairs;
(e)
a depository institution;
(f)
an entity that controls, is controlled by, or is under common control with a depository institution;
(g)
an employee or agent of an entity described in Subsections (2)(a) through (f):
(i)
when that person acts on behalf of the entity described in Subsections (2)(a) through (f); and
(ii)
including an employee of:
(A)
a depository institution;
(B)
a subsidiary of a depository institution that is:
(I)
owned and controlled by the depository institution; and
(II)
regulated by a federal banking agency, as defined in 12 U.S.C. § 5102; or
(C)
an institution regulated by the Farm Credit Administration;
(h)
except as provided in Subsection (3), a person who:
(i)
makes a loan:
(A)
secured by an interest in real property;
(B)
with the person’s own money; and
(C)
for the person’s own investment; and
(ii)
that does not engage in the business of making loans secured by an interest in real property;
(i)
except as provided in Subsection (3), a person who receives a mortgage, deed of trust, or consensual security interest on real property if the individual or entity:
(i)
is the seller of real property; and
(ii)
receives the mortgage, deed of trust, or consensual security interest on real property as security for a separate money obligation;
(j)
a person who receives a mortgage, deed of trust, or consensual security interest on real property if:
(i)
the person receives the mortgage, deed of trust, or consensual security interest as security for an obligation payable on an installment or deferred payment basis;
(ii)
the obligation described in Subsection (2)(j)(i) arises from a person providing materials or services used in the improvement of the real property that is the subject of the mortgage, deed of trust, or consensual security interest; and
(iii)
the mortgage, deed of trust, or consensual security interest is created without the consent of the owner of the real property that is the subject of the mortgage, deed of trust, or consensual security interest;
(k)
a nonprofit corporation that:
(i)
(A)
is exempt from paying federal income taxes;
(B)
is certified by the United States Small Business Administration as a small business investment company;
(C)
is organized to promote economic development in this state; and
(D)
has as the nonprofit corporation’s primary activity providing financing for business expansion;
(ii)
is a community development financial institution; or
(iii)
(A)
is exempt from paying federal income taxes;
(B)
has as the nonprofit corporation’s primary purpose serving the public by helping low-income individuals and families build, repair, or purchase housing;
(C)
does not require, under the terms of a mortgage, a balloon payment; and
(D)
to perform loan originator activities, uses only unpaid volunteers or employees whose compensation is not based on the number or size of the mortgage transactions that the employees originate;
(l)
an employee or volunteer for a nonprofit corporation described in Subsection (2)(k)(ii) or (iii), working within the scope of the nonprofit corporation’s business;
(m)
except as provided in Subsection (3), a court appointed fiduciary; or
(n)
an attorney admitted to practice law in this state:
(i)
if the attorney is not principally engaged in the business of negotiating residential mortgage loans when considering the attorney’s ordinary practice as a whole for all the attorney’s clients; and
(ii)
when the attorney engages in loan modification assistance in the course of the attorney’s practice as an attorney.
(3)
An individual who will engage in an activity as a mortgage loan originator is exempt from this chapter only if the individual is an employee or agent exempt under Subsection (2)(g).
(4)
(a)
A loan processor or loan underwriter who is not a mortgage loan originator is not required to obtain a license under this chapter when the loan processor or loan underwriter is:
(i)
employed by, and acting on behalf of, a person or entity licensed under this chapter; and
(ii)
under the direction of and subject to the supervision of a person licensed under this chapter.
(b)
A loan processor or loan underwriter who is an independent contractor is not exempt under Subsection (4)(a).
(5)
(a)
Notwithstanding Subsection (2)(m), an attorney exempt from this chapter may not engage in conduct described in Section 61-2c-301 when transacting business of residential mortgage loans.
(b)
If an attorney exempt from this chapter violates Subsection (5)(a), the attorney:
(i)
is not subject to enforcement by the division under 4; and
(ii)
may be subject to disciplinary action generally applicable to an attorney admitted to practice law in this state.
(c)
If the division receives a complaint alleging an attorney exempt from this chapter is in violation of Subsection (5)(a) or that an attorney subject to this chapter has violated this chapter, the division shall forward the complaint to the Utah State Bar for disciplinary action.
(6)
(a)
An individual who is exempt under Subsection (2), (3), or (4) may voluntarily obtain a license under this chapter by complying with 2.
(b)
An individual who voluntarily obtains a license under this Subsection (6) shall comply with all the provisions of this chapter.
