No mortgage lender or mortgage broker required to be licensed under this chapter shall:

Terms Used In Virginia Code 6.2-1614

  • Amortization: Paying off a loan by regular installments.
  • Commission: means the State Corporation Commission. See Virginia Code 6.2-100
  • Fixed Rate: Having a "fixed" rate means that the APR doesn't change based on fluctuations of some external rate (such as the "Prime Rate"). In other words, a fixed rate is a rate that is not a variable rate. A fixed APR can change over time, in several circumstances:
    • You are late making a payment or commit some other default, triggering an increase to a penalty rate
    • The bank changes the terms of your account and you do not reject the change.
    • The rate expires (if the rate was fixed for only a certain period of time).
  • Interest rate: The amount paid by a borrower to a lender in exchange for the use of the lender's money for a certain period of time. Interest is paid on loans or on debt instruments, such as notes or bonds, either at regular intervals or as part of a lump sum payment when the issue matures. Source: OCC
  • Mortgage: The written agreement pledging property to a creditor as collateral for a loan.
  • Mortgage broker: means any person who directly or indirectly negotiates, places or finds mortgage loans for others, or offers to negotiate, place or find mortgage loans for others. See Virginia Code 6.2-1600
  • Mortgage lender: means any person who directly or indirectly originates or makes mortgage loans. See Virginia Code 6.2-1600
  • Mortgage loan: means a loan made to an individual, the proceeds of which are to be used primarily for personal, family or household purposes, which loan is secured by a mortgage or deed of trust upon any interest in one- to four-family residential property located in the Commonwealth, regardless of where made, including the renewal or refinancing of any such loan, but excluding (i) loans to persons related to the lender by blood or marriage and (ii) loans to persons who are bona fide employees of the lender. See Virginia Code 6.2-1600
  • Mortgage loan: A loan made by a lender to a borrower for the financing of real property. Source: OCC
  • Person: means any individual or entity. See Virginia Code 6.2-1600
  • Principal: means any person who, directly or indirectly, owns or controls a 10 percent or greater interest in any entity. See Virginia Code 6.2-1600
  • real estate: includes lands, tenements and hereditaments, and all rights and appurtenances thereto and interests therein, other than a chattel interest. See Virginia Code 1-219
  • Residential property: means improved real property used or occupied, or intended to be used or occupied, for residential purposes. See Virginia Code 6.2-1600

1. Obtain any agreement or instrument in which blanks are left to be filled in after execution;

2. Take an interest in collateral other than the real estate or residential property securing a mortgage loan, including any fixtures and appliances thereon and any mobile or manufactured home placed on such real estate even if such mobile or manufactured home is not permanently affixed thereto;

3. Obtain any exclusive dealing or exclusive agency agreement from any borrower;

4. Delay closing of any mortgage loan for the purpose of increasing interest, costs, fees, or charges payable by the borrower;

5. Obtain any agreement or instrument executed by a borrower which contains an acceleration clause permitting the unpaid balance of a mortgage loan to be declared due for any reason other than failing to make timely payments of interest and principal, submitting false information in connection with an application for the mortgage loan, breaching any representation or covenant made in the agreement or instrument, or failing to perform any other obligations undertaken in the agreement or instrument;

6. Recommend or encourage a person to default on an existing loan or other debt, if such default adversely affects such person’s creditworthiness, in connection with the solicitation or making of a mortgage loan that refinances all or any portion of such existing loan or debt;

7. Knowingly or intentionally engage in the act or practice of refinancing a mortgage loan within 12 months following the date the refinanced mortgage loan was originated, unless the refinancing is in the borrower’s best interest, which act or practice is commonly referred to as “flipping.” This prohibition shall apply regardless of whether the interest rate, points, fees, and charges paid or payable by the borrower in connection with the refinancing exceed any limitation established pursuant to Chapter 3 (§ 6.2-300 et seq.) or Article 2 (§ 6.2-406 et seq.) of Chapter 4. Factors to be considered in determining if the refinancing is in the borrower’s best interest include but are not limited to whether:

a. The borrower’s new monthly payment is lower than the total of all monthly obligations being financed, taking into account the costs and fees;

b. There is a change in the amortization period of the new loan;

c. The borrower receives cash in excess of the costs and fees of refinancing;

d. The rate of interest on the borrower’s note is reduced;

e. There is a change from an adjustable to a fixed rate loan, taking into account costs and fees; and

f. The refinancing is necessary to respond to a bona fide personal need or an order of an appropriate court; or

8. Use or cause to be published any advertisement that:

a. Contains any false, misleading, or deceptive statement or representation; or

b. Identifies the mortgage lender or mortgage broker by any name other than the name set forth on the license issued by the Commission.

1987, c. 596, §§ 6.1-422, 6.1-424; 1989, c. 667; 1993, c. 183; 1995, c. 62; 1997, c. 228; 2001, cc. 502, 510, 511, § 6.1-422.1; 2003, c. 386; 2009, cc. 189, 261; 2010, c. 794.

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