CSHB 104(L&C): "An Act relating to exemptions from mortgage lender, mortgage broker, and mortgage loan originator licensing requirements; and providing for an effective date."
00 CS FOR HOUSE BILL NO. 104(L&C) 01 "An Act relating to exemptions from mortgage lender, mortgage broker, and mortgage 02 loan originator licensing requirements; and providing for an effective date." 03 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF ALASKA: 04 * Section 1. AS 06.60.015 is amended to read: 05 Sec. 06.60.015. Exemptions. (a) The following persons are exempt from the 06 mortgage lender or mortgage broker licensing requirements of this chapter: 07 (1) a depository institution; 08 (2) a subsidiary that is 09 (A) owned and controlled by a depository institution; and 10 (B) regulated by a federal banking agency; 11 (3) an institution regulated by the Farm Credit Administration; [OR] 12 (4) a federal, state, or local government agency, including an agency 13 that arranges or provides financing for mortgage loans; or 14 (5) a bona fide nonprofit organization.
01 (b) The following [INDIVIDUALS] are exempt from the mortgage loan 02 originator licensing requirements of this chapter: 03 (1) an individual who is a registered mortgage loan originator, when 04 acting for an entity described in (a)(1), (2), or (3) of this section; 05 (2) an individual who offers or negotiates terms of a residential 06 mortgage loan with or on behalf of an immediate family member of the individual; in 07 this paragraph, "immediate family member" means a spouse, child, stepchild, sibling, 08 stepsibling, parent, stepparent, grandparent, or grandchild; 09 (3) a [AN INDIVIDUAL] seller, including a natural person, estate, 10 trust, corporation, or another entity, that [WHO] offers or negotiates the terms of a 11 residential mortgage loan for the sale of residential property owned by the seller, if 12 (A) the loan is secured by a dwelling on the property; 13 (B) the seller self-finances the loan; 14 (C) during any 12-month period, the seller finances five or 15 fewer sales under this paragraph; 16 (D) in the ordinary course of a business of the seller, the 17 seller has not 18 (i) constructed the dwelling that secures the loan on 19 the property; or 20 (ii) acted as a contractor for the construction of the 21 dwelling that secures the loan on the property; 22 (E) the loan has an interest rate that is fixed for the full 23 term of the loan; 24 (F) the loan does not 25 (i) have a payment schedule that results in negative 26 amortization; or 27 (ii) allow or impose a prepayment penalty; and 28 (G) the seller determines that the purchaser has a 29 reasonable ability to repay the loan [THAT SERVES AS THE 30 INDIVIDUAL'S RESIDENCE]; 31 (4) an individual who is a licensed attorney who negotiates the terms
01 of a residential mortgage loan on behalf of a client as an ancillary matter to the 02 attorney's representation of the client, unless the attorney is compensated by a lender, 03 a mortgage broker, or another mortgage loan originator or by an agent of a lender, a 04 mortgage broker, or another mortgage loan originator; 05 (5) an employee of a bona fide nonprofit organization if the 06 employee acts as a mortgage loan originator only with respect to 07 (A) the employee's duties to the bona fide nonprofit 08 organization; and 09 (B) residential mortgage loans that have terms that are 10 favorable to the borrower by being consistent with mortgage loan 11 origination for a public or charitable purpose rather than in a commercial 12 context; 13 (6) an employee of a federal, state, or local government agency that 14 is exempt under (a)(4) of this section from the mortgage lender or mortgage 15 broker licensing requirements of this chapter. 16 * Sec. 2. AS 06.60.015 is amended by adding new subsections to read: 17 (c) For a nonprofit organization to qualify as a bona fide nonprofit 18 organization under (a)(5) of this section, the department shall determine that the 19 nonprofit organization 20 (1) has and maintains the status of a tax-exempt organization under 26 21 U.S.C. 501(c)(3) (Internal Revenue Code); 22 (2) promotes affordable housing or provides home ownership 23 education or similar services; 24 (3) conducts its activities in a manner that serves a public or charitable 25 purpose, rather than a commercial purpose, by offering mortgages that are not readily 26 available from other lenders; 27 (4) receives funding, receives revenue, and charges fees in a manner 28 that does not provide an incentive for the organization or its employees to act other 29 than in the best interests of its clients; 30 (5) compensates its employees in a manner that does not provide an 31 incentive to its employees to act other than in the best interests of its clients;
01 (6) provides or identifies for a borrower residential mortgage loans 02 with terms favorable to the borrower and comparable to mortgage loans and housing 03 assistance provided under government housing assistance programs; for residential 04 mortgage loans to have terms that are favorable to the borrower, the terms must be 05 consistent with mortgage loan origination for a public or charitable purpose, rather 06 than in a commercial context, and provide for interest rates that are less than the 07 current market rate; and 08 (7) meets other standards that the department determines are 09 appropriate. 10 (d) The department may establish by regulation the information that an 11 organization must provide to qualify as a bona fide nonprofit organization under (c) of 12 this section. 13 (e) The department shall establish by regulation 14 (1) the procedure for determining that an organization meets the 15 criteria identified under (c) of this section; 16 (2) the period for which the determination made under (c) of this 17 section remains in effect and the fee to be paid by the organization; 18 (3) how often and under what circumstances the department will 19 examine the books and activities of the organization to determine that the organization 20 continues to meet the criteria identified under (c) of this section; and 21 (4) the procedure for denying an organization the status of a bona fide 22 nonprofit organization, for suspending or revoking an organization's status as a bona 23 fide nonprofit organization if the organization does not continue to meet the criteria 24 identified under (c) of this section, and for taking disciplinary action against an 25 organization arising out of a violation of (c) - (e) of this section; the provisions of 26 AS 44.62 (Administrative Procedure Act) apply to an action of the department under 27 this paragraph. 28 * Sec. 3. AS 06.60.990 is amended by adding a new paragraph to read: 29 (36) "bona fide nonprofit organization" means an organization that the 30 department has determined qualifies as a bona fide nonprofit organization under 31 AS 06.60.015(c).
01 * Sec. 4. The uncodified law of the State of Alaska is amended by adding a new section to 02 read: 03 RETROACTIVITY. AS 06.60.015(b)(3), as amended by sec. 1 of this Act, is 04 retroactive to July 1, 2008. 05 * Sec. 5. This Act takes effect immediately under AS 01.10.070(c).