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The Oregon Administrative Rules contain OARs filed through August 15, 2014
 
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DEPARTMENT OF CONSUMER AND BUSINESS SERVICES,
DIVISION OF FINANCE AND CORPORATE SECURITIES

 

DIVISION 860

LICENSING OF MORTGAGE BANKERS AND MORTGAGE BROKERS

441-860-0020

Application Requirements

Each person applying for a mortgage banker or mortgage broker license shall submit to the director all the following required application materials and information:

(1) A completed Form MU1 submitted through the Nationwide Mortgage Licensing System and Registry and approved by the director.

(2) A completed Form MU2 submitted through the Nationwide Mortgage Licensing System and Registry and approved by the director for any individual that acts as a control person for the mortgage banker or mortgage broker .

(3)(a) A corporate surety bond meeting specified terms and calculated using the appropriate loan volume amounts under OAR 441-860-0085 if the applicant acts as the applicant’s sole mortgage loan originator or employs a mortgage loan originator; or

(b) A corporate surety bond or irrevocable letter of credit meeting specified terms and calculated using the appropriate loan volume amounts under OAR 441-860-0090 if the applicant is a mortgage banker and the applicant is either not a mortgage loan originator or the applicant is not required to employ a mortgage loan originator.

(4) Financial statements prepared in accordance with generally accepted accounting principles, including a balance sheet and a statement of income or operations, dated not more than six months prior to submission of the application through the Nationwide Mortgage Licensing System and Registry.

(a) The financial statements may be prepared by the mortgage banker or mortgage broker, except that if the director finds it in the public interest, the director may require that a mortgage banker or mortgage broker submit financial statements prepared by an independent accountant.

(b) If the financial statements are more than six months old, interim period financial statements prepared by the mortgage banker or mortgage broker for the period ending the last full month prior to the date of application shall also be submitted.

(5) A written authorization to examine the applicant's Clients' Trust Account under ORS 86A.157 or, in the case of a neutral escrow depository, a copy of the escrow agreement under OAR 441-875-0040 to the director.

(6) A copy of the written notice to financial institution of establishment of Clients' Trust Accounts under ORS 86A.160. In the event the applicant does not receive client funds except at the time of closing, an affidavit and undertaking in the form and on terms approved by the director.

(7) The name of the registered agent of the mortgage banker or mortgage broker appointed under ORS 60.111 to accept process, notices or demands served upon the mortgage banker or mortgage broker listed on the application submitted through the Nationwide Mortgage Licensing System and Registry.

(8) Biographical information required by OAR 441-860-0021 submitted through the Nationwide Mortgage Licensing System and Registry.

(9) The information required under OAR 441-860-0030 for each branch office submitted through the Nationwide Mortgage Licensing System and Registry.

(10) Payment of fees for application or renewal, as applicable, under OAR 441-860-0101, paid through the Nationwide Mortgage Licensing System and Registry

Stat. Auth.: ORS 86A.106, 86A.109, 86A.212
Stats. Implemented: ORS 86A.103, 86A.106, 86A.212
Hist.: FCS 3-1993, f. & cert. ef. 11-15-93; FCS 11-1994, f. 11-4-94, cert. ef. 11-15-94; FCS 1-1996, f. 11-20-96, cert. ef. 12-1-96; Administrative correction 8-4-97; FCS 4-1999, f. & cert. ef. 12-23-99; FCS 10-2000, f. & cert. ef. 9-13-00; FCS 10-2001, f. 12-24-01, cert. ef. 1-1-02; FCS 7-2003, f. 12-30-03 cert. ef. 1-1-04; FCS 6-2004, f. 12-14-04, cert. ef. 1-1-05; FCS 3-2005, f. & cert. ef. 9-6-05; FCS 1-2007, f. & cert. ef. 1-17-07; FCS 12-2009, f. 12-2-09, cert. ef. 1-1-10; FCS 14-2009, f. 12-30-09, cert. ef. 1-4-10; FCS 4-2012, f. & cert. ef 8-1-12

441-860-0021

Biographical Information Required for Mortgage Banker or Mortgage Broker License Application

(1) Each of the following persons listed in section (2) of this rule shall submit a Form MU2 to the director through the Nationwide Mortgage Licensing System and Registry.

(2) This rule applies to:

(A) Any director, officer, and a shareholder with a direct or indirect ownership of greater than or equal to ten percent of outstanding shares of a corporate applicant;

(B) The owner, if the applicant is an unincorporated sole proprietorship;

(C) Each managing partner of a limited partnership or a partner in a general partnership with a partnership interest greater than or equal to ten percent of the total partnership interests in the general or limited partnership;

(D) A member or managing member in a limited liability company with an ownership interest greater than or equal to ten percent of the total membership interests in the limited liability company; and

(E) The person identified in ORS 86A.106(2) as having the requisite experience in the mortgage business, negotiating loans in a related business satisfactory to the director, or lending experience in a related business satisfactory to the director.

Stat. Auth.: ORS 86A.106, 86A.109, 86A.212
Stats. Implemented: ORS 86A.103, 86A.106, 86A.212
Hist.: FCS 4-2012, f. & cert. ef 8-1-12

441-860-0024

Deficiencies in Mortgage Banker or Mortgage Broker License Application

(1) If an applicant, a mortgage banker or a mortgage broker submits an application, filing or amendment which is incomplete in any respect, the director shall notify the applicant of the deficiencies through the National Mortgage Licensing System. The applicant, the mortgage banker or the mortgage broker shall correct a deficiency associated with an application, filing or amendment within 30 days of being notified through the Nationwide Mortgage Licensing System and Registry that the director placed a deficiency on the person’s application, filing or amendment. A challenge submitted to the Nationwide Mortgage Licensing System and Registry as set out in OAR 441-850-0050 shall halt the 30-day period of time for correcting deficiencies for the duration of the challenge process.

(2) If the applicant fails to complete the application or respond to deficiencies within 30 days, the application will be considered abandoned. Any fees paid by the applicant under OAR 441-860-0101 will not be refunded due to abandonment. An applicant whose application is abandoned under this rule may reapply to obtain a mortgage banker or mortgage broker license.

Stat. Auth.: ORS 86A.106, 86A.109, 86A.212
Stats. Implemented: ORS 86A.103, 86A.106, 86A.212
Hist.: FCS 4-2012, f. & cert. ef 8-1-12

441-860-0025

Rules for Use of Assumed Business Names

(1) In addition to any requirements for registering an assumed business name with the Secretary of State, a mortgage banker or mortgage broker who intends to use an assumed business name to identify the person’s mortgage banker or mortgage broker business shall also comply with the following before doing business under the assumed business name:

(a) If the assumed business name contains words or phrases described in ORS 56.023, the mortgage banker or mortgage broker must obtain specific written approval from the director under ORS 705.635 and OAR 441-005-0010.

(b) The assumed business name must be added to the corporate surety bond of the mortgage banker or mortgage broker under either OAR 441-860-0085 or 441-860-0090.

(c) The mortgage banker or mortgage broker may purchase a separate corporate surety bond for the assumed business name if:

(A) The separate corporate surety bond contains the name of the principal mortgage banker or mortgage; and

(B) The separate corporate surety bond complies with either OAR 441-860-0085 or 441-860-0090, as applicable.

(d) Any corporate surety bond must be in force as of the date of the addition of the assumed business name, and must be forwarded to the director within two weeks from the addition of the assumed business name; and

(e) The assumed business name must be placed upon any client trust account maintained by the mortgage banker or mortgage broker.

(2) Regardless of the lack of any ownership interest in the assumed business name, the mortgage banker or mortgage broker is responsible for all actions of those acting under the assumed business name which relate to mortgage banking loans or mortgage loans.

Stat. Auth.: ORS 86A.106, 86A.136
Stats. Implemented: ORS 86A.106
Hist.: FCS 4-1999, f. & cert. ef. 12-23-99; FCS 14-2009, f. 12-30-09, cert. ef. 1-4-10; FCS 4-2012, f. & cert. ef 8-1-12

441-860-0030

Branch Office Licensing

(1) If a mortgage banker or mortgage broker intends to operate a branch office, the mortgage banker or mortgage broker shall obtain a license for the branch office prior to originating loans from the branch office by submitting the licensing fee specified in OAR 441-860-0101 and submitting a Form MU3 to the Nationwide Mortgage Licensing System and Registry:

(2) Upon satisfaction of the requirements listed in section (1), the director shall issue a separate branch office license.

Stat. Auth.: ORS 86A.106, 86A.136
Stats. Implemented: ORS 86A.103
Hist.: FCS 3-1993, f. & cert. ef. 11-15-93; FCS 11-1994, f. 11-4-94, cert. ef. 11-15-94; FCS 4-1999, f. & cert. ef. 12-23-99; FCS 1-2007, f. & cert. ef. 1-17-07; FCS 12-2009, f. 12-2-09, cert. ef. 1-1-10; FCS 14-2009, f. 12-30-09, cert. ef. 1-4-10; FCS 4-2012, f. & cert. ef 8-1-12

441-860-0040

Supervision of Branch Offices and Mortgage Loan Originators

(1) A mortgage banker or a mortgage broker must diligently supervise and control every mortgage loan originator employed by the mortgage banker or the mortgage broker in the mortgage banker or mortgage broker’s principal place of business and at each branch office.

(2) A mortgage banker or mortgage broker must personally supervise or designate a control person to supervise each branch office to ensure compliance with ORS 86A.095 through 86A.198 and OAR chapter 441, divisions 850 through 885, as applicable.

(3) In order to diligently supervise and control a mortgage loan originator employed by the mortgage banker or the mortgage broker, the mortgage banker or mortgage broker shall:

(a) Ensure that mortgage loan originators, and persons required to be licensed as mortgage loan originators, employed by the mortgage banker or mortgage broker obtain and maintain a license under ORS 86A.200 through 86A.242 and OAR chapter 441, division 880.

(b) Establish, maintain and enforce written procedures to supervise the activities of mortgage loan originators employed by the mortgage banker or mortgage broker and other associated persons that are subject to its supervision and to supervise the operations of each office of the mortgage banker or mortgage broker transacting loans with Oregon consumers. The procedures shall be reasonably designed to achieve compliance with applicable Oregon and federal lending laws and rules, including ORS 86A.095 through 86A.198.

(c) Review the activities of each office transacting loans with Oregon consumers, which shall include the examination of customer loan files, including closed and opened files. The reviews shall be reasonably designed to assist in detecting violations of, preventing violations of and achieving compliance with applicable mortgage lending laws, regulations and rules, as well as detecting and preventing irregularities or abuses. Each mortgage broker shall retain a record of the dates and findings of each review. The duties of this rule may be delegated to a qualified supervisor.

(d) Provide a copy of the procedures required by this rule to every mortgage loan originator employed by the mortgage banker or mortgage broker in written or electronic format.

(e) Ensure that mortgage loan originators obtain training to address deficiencies identified by the mortgage banker or mortgage broker in loan file and operations reviews or make up deficiencies in continuing education as necessary.

(f) Establish procedures for handling consumer complaints and develop procedures to identify the types of consumer complaints that must be forwarded to a supervisor for review. Complaints that must be forwarded to a supervisor include complaints about material changes in loan terms, fees or expenses, or material omissions about loan terms, fees or expenses. The mortgage banker or mortgage broker shall also develop procedures for investigating, responding to and keeping a record of complaints forwarded to a supervisor.

(g) Visit at least annually each branch the mortgage banker or mortgage broker licenses in Oregon to review compliance with the procedures listed in this section.

(4) In establishing the procedures in section (2) of this rule and in determining the frequency of office reviews, the mortgage banker or mortgage broker shall consider the following:

(a) The number of loan transactions made by the mortgage banker or mortgage broker;

(b) The number of office locations transacting loans with Oregon consumers;

(c) The number of affiliated persons assigned to each location;

(d) The nature and complexity of the loan transactions that the mortgage banker or mortgage broker predominantly makes;

(e) The number of mortgage loan originators assigned to a location;

(f) The number of mortgage loan originators assigned to the supervision of an individual supervisor; and

(g) The results of previous office reviews.

(5) In establishing the procedures in section (2) of this rule and in determining the number of files from each mortgage loan originator to be reviewed, the mortgage banker or mortgage broker shall consider the following:

(a) The knowledge and years of lending experience of a mortgage loan originator;

(b) The disciplinary history of and the number of complaints received about a mortgage loan originator;

(c) The experience and level of sophistication of the borrowers of a mortgage loan originator, if the mortgage banker, mortgage broker or mortgage loan originator predominantly serves specific segments of society;

(d) The nature and complexity of the loan transactions that the mortgage banker or mortgage broker predominantly makes; and

(e) The results of previous file reviews for a particular mortgage loan originator.

(6) The mortgage banker or mortgage broker is subject to disciplinary action of the director for any violation of ORS 86A.095 through 86A.198 or corresponding rules committed by a mortgage loan originator authorized to make or negotiate residential mortgage loans for the mortgage banker or mortgage broker, whether or not that accountability is documented in any written agreement.

Stat. Auth.: ORS 86A.136
Stats. Implemented: ORS 86A.115
Hist.: FCS 3-1993, f. & cert. ef. 11-15-93; FCS 11-1994, f. 11-4-94, cert. ef. 11-15-94; FCS 1-2007, f. & cert. ef. 1-17-07; FCS 14-2009, f. 12-30-09, cert. ef. 1-4-10; FCS 4-2012, f. & cert. ef 8-1-12

441-860-0045

State Criminal Records Check

(1) In addition to the criminal records check required for submission to the National Mortgage Licensing System and Registry under 2009 Or Laws ch. 863, ¦¦ 4 and 10, a mortgage banker or mortgage broker must conduct a state criminal records check of each individual employed by the mortgage banker or mortgage broker as a mortgage loan originator.

(a) The mortgage banker or mortgage broker shall search state records of all states where the individual has resided in the past 10 years using the person's full legal name, date of birth, place of birth and Social Security number.

(b) The mortgage banker or mortgage broker must use the services of law enforcement agencies or an independent private company that complies with the federal Fair Credit Reporting Act to conduct the state criminal records check.

(2) An applicant for a mortgage loan originator license may not be employed and a currently employed mortgage loan originator must be terminated immediately if the state criminal records check discloses a conviction for a felony or a misdemeanor if an essential element of the misdemeanor involved false statements or dishonesty:

(a) During a period of seven years before the date the applicant submits an application for a license as a mortgage loan originator; or

(b) At any time before the date the applicant submits an application a license as a mortgage loan originator if the conviction or plea involved a felony and an element of the felony was an act of fraud, dishonesty, a breach of trust or laundering a monetary instrument.

(3) State criminal records check documents received by the mortgage banker or mortgage broker shall be maintained in a secure location separate from personnel records, and shall be made available to the director for examination at any reasonable time and may require, without subpoena, the production of such records at the office of the director as often as is reasonably necessary. These records shall be preserved for three years after the mortgage banker or mortgage broker terminates the mortgage loan originator’s employment. After the retention period, the records shall be destroyed in a secure manner.

Stat. Auth.: ORS 86A.183 & 86A.186
Stats. Implemented: ORS 86A.183 & 86A.186
Hist.: FCS 5-2003, f. 12-30-03 cert. ef. 1-1-04; FCS 2-2004, f. & cert. ef. 8-5-04; Renumbered from 441-880-0050 by FCS 14-2009, f. 12-30-09, cert. ef. 1-4-10

441-860-0050

Renewal of Mortgage Banker and Mortgage Broker License

(1) A mortgage banker or a mortgage broker license shall expire on December 31 of each calendar year. At least 30 days prior to the expiration of a mortgage banker or mortgage broker license, an application for renewal of the license shall be submitted to the director through the Nationwide Mortgage Licensing System and Registry and shall include the following:

(a) A completed Form MU1 approved by the director.

(b) Financial statements prepared in accordance with generally accepted accounting principles, including a balance sheet and a statement of income or operations, dated not more than six months prior to submission of the application. If the financial statements are more than six months old, interim period financial statements prepared by the mortgage banker or mortgage broker for the period ending the last full month prior to the date of the application must also be submitted. Notwithstanding section (1) of this rule, a mortgage banker or a mortgage broker shall provide financial statements within 45 days following the end of the company’s fiscal year to the Nationwide Mortgage Licensing System and Registry.

(c) Any applicable renewal fees prescribed under OAR 441-860-0101.

(2) A mortgage banker or mortgage broker shall file with the director each calendar year a corporate surety bond meeting specified terms and calculated using the appropriate loan volume amounts under OAR 441-860-0085 or a corporate surety bond or irrevocable letter of credit meeting specified terms and calculated using the appropriate loan volume amounts under OAR 441-860-0090.

(3) The director may refuse to renew a license if a reason exists under ORS 86A.095 through 86A.198 or 86A.200 through 86A.239.

(4) If a mortgage banker or mortgage broker submits an application for renewal which is incomplete in any respect, the director shall notify the mortgage banker or broker of the deficiencies on the application. The mortgage banker or mortgage broker shall have 30 days from the date of the notice or the end of the renewal period, whichever occurs first, to complete the application for renewal. If the mortgage banker or mortgage broker fails to complete the application for renewal, and the license shall be terminated on the expiration date by reason of failure to renew.

Stat. Auth.: ORS 86A.106, 86A.109, 86A.136
Stats. Implemented: ORS 86A.109, 86A.179
Hist.: FCS 3-1993, f. & cert. ef. 11-15-93; FCS 11-1995, f. 11-4-94, cert. ef. 11-15-94; FCS 4-1999, f. & cert. ef. 12-23-99; FCS 10-2000, f. & cert. ef. 9-13-00; FCS 10-2001, f. 12-24-01, cert. ef. 1-1-02; FCS 7-2003, f. 12-30-04, 1-1-04; FCS 6-2004, f. 12-14-04, cert. ef. 1-1-05; FCS 12-2009, f. 12-2-09, cert. ef. 1-1-10; FCS 14-2009, f. 12-30-09, cert. ef. 1-4-10; FCS 4-2012, f. & cert. ef 8-1-12

441-860-0060

Equivalent and Related Experience

(1) An applicant or an applicant’s control person who has experience in the following categories shall be given full credit for such experience toward meeting the experience requirement under ORS 86A.106:

(a) Origination of loans secured by lien interests in real estate;

(b) Negotiation of loans secured by lien interests in real estate;

(c) Underwriting of loans secured by lien interests in real estate; or

(d) Persons who supervise the activities of those persons enumerated in subsections (a) through (c) of this section.

(2) An applicant who has experience in the following categories, within the five year period preceding the application date, may receive partial credit for such experience toward the experience requirement contained in ORS 86A.095 through 86A.198. Credit may be given in only one category listed and for not more than three years actual experience. Credit given shall be in the ratios of actual years of experience to equivalent years credited toward qualification for a mortgage banker and mortgage broker license as set forth below. The remaining years of experience required to qualify for a mortgage banker or mortgage broker license shall be obtained from experience in categories listed in section (1) of this rule. The categories of possible alternative experience for which partial credit is available, and the ratios of actual years of experience to equivalent years credited toward qualification for a mortgage banker or mortgage broker license are:

(a) Escrow officer, 3:2;

(b) Loan processor with responsibility primarily for loans secured by lien interests on real estate, 3:2;

(c) Branch manager of lender with responsibilities primarily for loans not secured by lien interests on real estate, 3:1.5;

(d) Loan officer with responsibility primarily for loans not secured by lien interests on real estate, 3:1.5;

(e) Paralegal with demonstrated experience in real estate financing matters, 3:1;

(f) Real estate broker with an Oregon license or a license from a state with substantially equivalent real estate licensing requirements, 3:1;

(g) Title officer with a title company, 3:1;

(h) Real estate broker, not within subsection (f) of this section, 3:1;

(i) Real estate salesperson with an Oregon license or a license from a state with substantially equivalent licensing requirements, 3:1;

(j) Licensed real estate appraiser, 3:1; and

(k) Real estate salespersons not included in subsection (i) of this section, 3:0.5.

(3) An applicant who does not originate loan applications or negotiate loan terms but who is in the business of selling real estate paper whether as issuer, agent or principal, to persons other than persons enumerated in ORS 59.035, or who engages all or part of the time, for the account of others or for the person's own account, in the business of accepting funds from one or more persons other than persons enumerated in ORS 59.035 for investment in real estate paper, shall be given full credit for experience toward meeting the three of the past five year experience requirement contained for:

(a) Experience as a licensed securities salesperson under the provisions of ORS 59.165; or,

(b) Experience as a securities salesperson effecting transactions in securities which are exempt from registration under the provisions of ORS 59.025 and 59.035.

(4) The individual listed as the experienced person, as described in ORS 86A.106, on the applicant's licensing application may not work, as an employee or independent contractor as the experienced person, for another mortgage banker or mortgage broker.

Stat. Auth.: ORS 86A.106(2) & 86A.136
Stats. Implemented: ORS 86A.100
Hist.: FCS 3-1993, f. & cert. ef. 11-15-93; FCS 11-1994, f. 11-4-94, cert. ef. 11-15-94; FCS 4-1999, f. & cert. ef. 12-23-99; FCS 7-2001, f. & cert. ef. 8-1-01; FCS 2-2004, f. & cert. ef. 8-5-04; FCS 1-2007, f. & cert. ef. 1-17-07; FCS 14-2009, f. 12-30-09, cert. ef. 1-4-10; FCS 4-2012, f. & cert. ef 8-1-12

441-860-0070

Disclosure of Significant Developments

(1) A mortgage banker or mortgage broker shall be required to notify the director within 30 days of the occurrence of any of the following significant developments:

(a) Filing for bankruptcy or reorganization.

(b) Notification of the institution of license revocation procedures against the mortgage banker or mortgage broker by any state.

(c) Filing of a felony indictment against a mortgage banker or mortgage broker, officer, director, principal, control person or experienced person.

(d) A mortgage banker or mortgage broker, officer, director, principal, control person or experienced persons being convicted of a felony or misdemeanor involving fraud.

(e) All material litigation occurring against the mortgage banker or mortgage broker.

(f) The director may require other information as deemed necessary to determine whether a new application is required if a change of control or ownership of a mortgage banker or mortgage broker occurs. For purposes of this rule, a change in control or ownership includes:

(A) Acquisition of ten percent or more of the stock in a corporation by a person or a group of persons, or the ability of a person or group acting in concert to elect a majority of the directors or otherwise effect a change in policy of the corporation.

(B) Acquisition of the mortgage banker or mortgage broker business, if the applicant is an unincorporated sole proprietorship;

(C) Acquisition by a managing partner of a limited partnership or a partner in a general partnership of ten percent or more of the partnership interests in the general or limited partnership;

(D) Acquisition by a member or managing member in a limited liability company of a membership interest greater than or equal to ten percent of the total membership interests in the limited liability company; and

(E) In the case of entities other than corporations or those listed in paragraphs (A) through (D) of this subsection, change in control shall mean any change in principals of the organization, whether active or passive.

(g) In addition to the requirements of OAR 441-860-0030, a mortgage banker or a mortgage broker shall notify the director when a branch office ceases to operate.

(h) Any changes in the information required on the mortgage banker or mortgage broker's application form, including, but not limited to address changes, phone number changes, etc.

(i) Any changes in the status of a mortgage loan originator employed by the mortgage banker or mortgage broker.

(j) Any dismissal of a mortgage loan originator employed by the mortgage banker or mortgage broker due to a change in the mortgage loan originator’s licensing status or an event that would constitute grounds for license revocation under 86A.200 through 86A.239 and OAR chapter 441, division 880.

(2) The director may request additional information regarding any of the occurrences outlined in this rule.

Stat. Auth.: ORS 586A.106 & 86A.136
Stats. Implemented: ORS 86A.112
Hist.: FCS 3-1993, f. & cert. ef. 11-15-93; FCS 4-1999, f. & cert. ef. 12-23-99; FCS 10-2001, f. 12-24-01, cert. ef. 1-1-02; FCS 2-2004, f. & cert. ef. 8-5-04; FCS 14-2009, f. 12-30-09, cert. ef. 1-4-10

441-860-0080

Failure to Continually Satisfy Experience Requirement

(1) If a mortgage banker or mortgage broker fails to satisfy the experience requirements under ORS 86A.106 during any licensing period regardless of the reason for that failure, the mortgage banker or mortgage broker shall:

(a) Notify the director within three working days that the mortgage banker or mortgage broker no longer satisfies the experience requirement;

(b) Submit to the director within seven calendar days of the occurrence, an inventory and status of pending loan application files including an accounting of all Clients' Trust Accounts;

(c) Account for all investor funds;

(d) Submit to the director within one week of the occurrence a proposed plan to rectify the deficiency or a plan for the orderly transfer of business to a duly licensed mortgage banker or mortgage broker;

(e) Immediately cease accepting new applications from borrowers and, in the case of mortgage brokers who fund mortgages from investors other than institutions described in ORS 59.035, solicitation of funds and accepting such investor funds shall immediately cease.

(2) If the mortgage banker or mortgage broker fails to comply with the provisions of section (1) of this rule, the director shall take appropriate action, consistent with the authority granted pursuant to ORS 86A.095 through 86A.198 to ensure that the interests of borrowers and investors are protected.

(3) If the mortgage banker or mortgage broker is unable to satisfy the director that the experience requirement will be satisfied within 30 days, the director may institute action to suspend or revoke the mortgage banker’s or mortgage banker’s license.

(4) The director may require reports on the status of the mortgage banker or mortgage broker's business. A mortgage banker or mortgage broker shall provide a report containing the content specified by the director as often as the director may specify. The reports may be written or oral, or both as the director may specify.

(5) If a mortgage banker or mortgage broker renews a license but does not conduct business, the time period that the person does not conduct business does not apply to the experience requirement in ORS 86A.106.

Stat. Auth.: ORS 86A.106, 86A.115 & 86A.136
Stats. Implemented: ORS 86A.100
Hist.: FCS 3-1993, f. & cert. ef. 11-15-93; FCS 11-1994, f. 11-4-94, cert. ef. 11-15-94; FCS 4-1999, f. & cert. ef. 12-23-99; FCS 10-2001, f. 12-24-01, cert. ef. 1-1-02; FCS 14-2009, f. 12-30-09, cert. ef. 1-4-10; FCS 4-2012, f. & cert. ef 8-1-12

441-860-0085

Corporate Surety Bond for Mortgage Bankers or Mortgage Brokers Acting as or Employing a Mortgage Loan Originator

(1) This rule applies to a mortgage banker or mortgage broker licensed under ORS 86A.095 through 86A.198 and OAR chapter 441, division 860 that either acts as the applicant’s sole mortgage loan originator or employs one or more mortgage loan originators. A mortgage banker or mortgage broker must maintain a corporate surety bond during the time the person acts as a mortgage loan originator or during the time the person employs a mortgage loan originator.

(2) The corporate surety bond must be in a form and on terms approved by the director and shall be renewed or replaced each calendar year. The corporate surety bond shall be delivered to the director by December 1 of each calendar year but may be made effective as of December 31 of each calendar year. In no case shall any applicant, mortgage banker or mortgage broker subject to this rule reduce the amount of a corporate surety bond before October 1 of each calendar year.

(2) The corporate surety bond must remain in effect for at least five years after the person ceases to be licensed as a mortgage banker or mortgage broker. A consumer must file a claim against the corporate surety bond before the bond expires as described in this section.

(3) At least five years after a person ceases to be licensed as a mortgage banker or mortgage broker, the person or the writer of the corporate surety bond may apply to the director for release of the corporate surety bond. Unless the director determines that claims are pending against the person for violation of ORS 86A.095 through 86A.198, the director will release the corporate surety bond.

(4) The sum of the corporate surety bond must be calculated based on the last required residential mortgage lending report submitted under OAR 441-865-0025. The sum of the corporate surety bond must be determined as follows:

(a) For a person that has not previously conducted business involving the origination of residential mortgage loans in Oregon, the corporate surety bond must be in the amount of $50,000.

(b) For a person making or negotiating less than $10,000,000 in residential mortgage loans in Oregon in the previous calendar year, the corporate surety bond must be in the amount of $50,000.

(c) For a person making or negotiating $10,000,000 or more but less than $25,000,000 in residential mortgage loans in Oregon in the previous calendar year, the corporate surety bond must be in the amount of $75,000.

(d) For a person making or negotiating $25,000,000 or more but less than $50,000,000 in mortgage loans in Oregon in the previous calendar year, the corporate surety bond must be in the amount of $100,000.

(e) For a person making or negotiating $50,000,000 or more but less than $100,000,000 in residential mortgage loans in Oregon in the previous calendar year, the corporate surety bond must be in the amount of $150,000.

(f) For a person making or negotiating $100,000,000 or more in residential mortgage loans in Oregon in the previous calendar year, the corporate surety bond must be in the amount of $200,000.

Stat. Auth.: ORS 86A.242
Stats. Implemented: ORS 86A.227
Hist.: FCS 3-2010, f. 3-18-10, cert. ef. 3-22-10; FCS 4-2012, f. & cert. ef 8-1-12

441-860-0090

Corporate Surety Bond or Irrevocable Letter of Credit for Mortgage Bankers Not Employing Mortgage Loan Originators

(1) Every applicant for a license as a mortgage banker who will not act as or employ a mortgage loan originator and does not take an application for a residential mortgage loan, or offer or negotiate terms for a residential mortgage loan must file a corporate surety bond or irrevocable letter of credit with the director as specified in this rule in a form and on terms approved by the director. The corporate surety bond shall be renewed or replaced each calendar year. The corporate surety bond or irrevocable letter of credit shall be delivered to the director by December 1 of each calendar year but may be made effective as of December 31 of each calendar year. In no case shall any applicant, mortgage banker or mortgage broker subject to this rule reduce the amount of a corporate surety bond or irrevocable letter of credit before October 1 of each calendar year.

(2) Every person licensed as a mortgage banker must maintain a corporate surety bond or irrevocable letter of credit as specified in this rule during the time the mortgage banker or mortgage broker is licensed but does not act as or employ a mortgage loan originator. The corporate surety bond or irrevocable letter of credit must remain in effect for at least five years after the person ceases to be licensed as a mortgage banker. A consumer must file a claim against the corporate surety bond or irrevocable letter of credit before the corporate surety bond or irrevocable letter of credit expires as described in this section.

(3) At least five years after a person ceases to be licensed as a mortgage banker, the person or the writer of the corporate surety bond or irrevocable letter of credit may apply to the director for release of the corporate surety bond or irrevocable letter of credit. Unless the director determines that claims are pending against the person for violation of ORS 86A.095 through 86A.198, the director will release the corporate surety bond or irrevocable letter of credit.

(4) The corporate surety bond or irrevocable letter of credit must be calculated based on the last required residential mortgage lending report submitted under OAR 441-865-0025. The sum of the corporate surety bond or irrevocable letter of credit must be determined as follows:

(a) For a person that has not previously conducted business involving the origination of residential mortgage loans in Oregon, the corporate surety bond or irrevocable letter of credit must be in the amount of $50,000.

(b) For a person making or negotiating less than $10,000,000 in residential mortgage loans in Oregon in the previous calendar year, the corporate surety bond or irrevocable letter of credit must be in the amount of $50,000.

(c) For a person making or negotiating $10,000,000 or more but less than $25,000,000 in residential mortgage loans in Oregon in the previous calendar year, the corporate surety bond or irrevocable letter of credit must be in the amount of $75,000.

(d) For a person making or negotiating $25,000,000 or more but less than $50,000,000 in mortgage loans in Oregon in the previous calendar year, the corporate surety bond or irrevocable letter of credit must be in the amount of $100,000.

(e) For a person making or negotiating $50,000,000 or more but less than $100,000,000 in residential mortgage loans in Oregon in the previous calendar year, the corporate surety bond or irrevocable letter of credit must be in the amount of $150,000.

(f) For a person making or negotiating $100,000,000 or more in residential mortgage loans in Oregon in the previous calendar year, the corporate surety bond or irrevocable letter of credit must be in the amount of $200,000.

Stat. Auth.: ORS 86A.136
Stats. Implemented: ORS 86A.106
Hist.: FCS 3-1993, f. & cert. ef. 11-15-93; FCS 11-1994, f. 11-4-94, cert. ef. 11-15-94; FCS 4-1999, f. & cert. ef. 12-23-99; FCS 10-2001, f. 12-24-01, cert. ef. 1-1-02; FCS 2-2004, f. & cert. ef. 8-5-04; FCS 3-2010, f. 3-18-10, cert. ef. 3-22-10; FCS 4-2012, f. & cert. ef 8-1-12

441-860-0101

Fees Payable to the Director

In addition to any fees required to participate in the National Mortgage Licensing System and Registry, a mortgage banker or a mortgage broker shall pay to the director the following fees at the time of application or renewal:

(1) A nonrefundable application fee for a mortgage banker or mortgage broker license of $960 plus a $330 nonrefundable application fee for each branch the mortgage banker or mortgage broker establishes in Oregon.

(2) A nonrefundable renewal application fee for a mortgage banker or mortgage broker license of $480 plus a $165 nonrefundable renewal application fee for each branch the mortgage banker or mortgage broker maintains in Oregon.

Stat. Auth.: ORS 86A.136
Stats. Implemented: ORS 86A.106, 2011 OL Ch. 618 ¦ 1
Hist.: FCS 12-2009, f. 12-2-09, cert. ef. 1-1-10; FCS 5-2011(Temp), f. 6-30-11, cert. ef. 7-1-11 thru 12-28-11; FCS 8-2011, f. & cert. ef. 10-3-11

441-860-0110

Examination Charges Mortgage Bankers or Mortgage Brokers Pay to the Director

(1) Examination charges shall be paid upon receipt of the invoice of examination fees.

(2) In addition to the initial application and renewal fees assessed under ORS 86A.124 and these rules, licensees shall pay an examination charge in the amount of $75 an hour for each person used in performance of the examination.

(3) Notwithstanding section (2) of this rule:

(a) If an employee of the Department is required to travel out of state to perform the work described by section (2) of this rule, the rate of charge is $75 per hour plus costs for travel and subsistence for each such person;

(b) If the work described in section (2) of this rule is performed by a consultant hired by contract for the particular work, the charge payable by the licensee is the actual cost to the director of the contract consultant.

Stat. Auth.: ORS 86A.124
Stats. Implemented: ORS 86A.124
Hist.: FCS 3-1993, f. & cert. ef. 11-15-93; FCS 11-1994, f. 11-4-94, cert. ef. 11-15-94; FCS 10-2001, f. 12-24-01, cert. ef. 1-1-02; FCS 8-2008, f. & cert. ef. 8-28-08; FCS 4-2012, f. & cert. ef 8-1-12

441-860-0130

Private Money Loans

A person is not engaged in the business of making loans secured by an interest in real estate as used in ORS 86A.100(3)(a)(C) and (5)(a)(F) if the person is making a loan from their own funds and does not make more than 10 loans secured by an interest in residential real estate during any consecutive twelve month period if they do not advertise or otherwise hold themselves out as being in the business of making mortgage loans.

Stat. Auth.: ORS 86A.136
Stats. Implemented: ORS 86A.100
Hist.: FCS 4-1999, f. & cert. ef. 12-23-99; FCS 14-2009, f. 12-30-09, cert. ef. 1-4-10

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