CSHB 104(L&C) am: "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) am 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(a) is amended to read: 05 (a) The following persons are exempt from the mortgage lender or mortgage 06 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 * Sec. 2. AS 06.60.015(b) is amended to read: 02 (b) The following [INDIVIDUALS] are exempt from the mortgage loan 03 originator licensing requirements of this chapter: 04 (1) an individual who is a registered mortgage loan originator, when 05 acting for an entity described in (a)(1), (2), or (3) of this section; 06 (2) an individual who offers or negotiates terms of a residential 07 mortgage loan with or on behalf of an immediate family member of the individual; in 08 this paragraph, "immediate family member" means a spouse, child, stepchild, sibling, 09 stepsibling, parent, stepparent, grandparent, or grandchild; 10 (3) an individual seller who offers or negotiates terms of a residential 11 mortgage loan secured by a dwelling that serves as the individual's residence; 12 (4) a seller, including a natural person, estate, trust, corporation, 13 or another entity, that offers or negotiates the terms of a residential mortgage 14 loan for the sale of residential property owned by the seller, if 15 (A) the loan is secured by a dwelling on the property; 16 (B) the seller self-finances the loan; 17 (C) during any 12-month period, the seller finances five or 18 fewer sales under this paragraph; 19 (D) in the ordinary course of a business of the seller, the 20 seller has not 21 (i) constructed the dwelling that secures the loan on 22 the property; or 23 (ii) acted as a contractor for the construction of the 24 dwelling that secures the loan on the property; 25 (E) the loan has an interest rate that is fixed for the full 26 term of the loan; 27 (F) the loan does not 28 (i) have a payment schedule that results in negative 29 amortization; or 30 (ii) allow or impose a prepayment penalty; and 31 (G) the seller determines that the purchaser has a
01 reasonable ability to repay the loan; 02 (5) an individual who is a licensed attorney who negotiates the terms 03 of a residential mortgage loan on behalf of a client as an ancillary matter to the 04 attorney's representation of the client, unless the attorney is compensated by a lender, 05 a mortgage broker, or another mortgage loan originator or by an agent of a lender, a 06 mortgage broker, or another mortgage loan originator; 07 (6) an employee of a federal, state, or local government agency that 08 is exempt under (a)(4) of this section from the mortgage lender or mortgage 09 broker licensing requirements of this chapter. 10 * Sec. 3. AS 06.60.015(b), as amended by sec. 2 of this Act, is amended to read: 11 (b) The following are exempt from the mortgage loan originator licensing 12 requirements of this chapter: 13 (1) an individual who is a registered mortgage loan originator, when 14 acting for an entity described in (a)(1), (2), or (3) of this section; 15 (2) an individual who offers or negotiates terms of a residential 16 mortgage loan with or on behalf of an immediate family member of the individual; in 17 this paragraph, "immediate family member" means a spouse, child, stepchild, sibling, 18 stepsibling, parent, stepparent, grandparent, or grandchild; 19 (3) an individual seller who offers or negotiates terms of a residential 20 mortgage loan secured by a dwelling that serves as the individual's residence; 21 (4) a seller, including a natural person, estate, trust, corporation, or 22 another entity, that offers or negotiates the terms of a residential mortgage loan for the 23 sale of residential property owned by the seller, if 24 (A) the loan is secured by a dwelling on the property; 25 (B) the seller self-finances the loan; 26 (C) during any 12-month period, the seller finances five or 27 fewer sales under this paragraph; 28 (D) in the ordinary course of a business of the seller, the seller 29 has not 30 (i) constructed the dwelling that secures the loan on the 31 property; or
01 (ii) acted as a contractor for the construction of the 02 dwelling that secures the loan on the property; 03 (E) the loan has an interest rate that is fixed for the full term of 04 the loan; 05 (F) the loan does not 06 (i) have a payment schedule that results in negative 07 amortization; or 08 (ii) allow or impose a prepayment penalty; and 09 (G) the seller determines that the purchaser has a reasonable 10 ability to repay the loan; 11 (5) an individual who is a licensed attorney who negotiates the terms 12 of a residential mortgage loan on behalf of a client as an ancillary matter to the 13 attorney's representation of the client, unless the attorney is compensated by a lender, 14 a mortgage broker, or another mortgage loan originator or by an agent of a lender, a 15 mortgage broker, or another mortgage loan originator; 16 (6) an employee of a federal, state, or local government agency that is 17 exempt under (a)(4) of this section from the mortgage lender or mortgage broker 18 licensing requirements of this chapter; 19 (7) an employee of a bona fide nonprofit organization if the 20 employee acts as a mortgage loan originator only with respect to 21 (A) the employee's duties to the bona fide nonprofit 22 organization; and 23 (B) residential mortgage loans that have terms that are 24 favorable to the borrower by being consistent with mortgage loan 25 origination for a public or charitable purpose rather than in a commercial 26 context. 27 * Sec. 4. AS 06.60.015 is amended by adding new subsections to read: 28 (c) For a nonprofit organization to qualify as a bona fide nonprofit 29 organization under (a)(5) of this section, the department shall determine that the 30 nonprofit organization 31 (1) has and maintains the status of a tax-exempt organization under 26
01 U.S.C. 501(c)(3) (Internal Revenue Code); 02 (2) promotes affordable housing or provides home ownership 03 education or similar services; 04 (3) conducts its activities in a manner that serves a public or charitable 05 purpose, rather than a commercial purpose, by offering mortgages that are not readily 06 available from other lenders; 07 (4) receives funding, receives revenue, and charges fees in a manner 08 that does not provide an incentive for the organization or its employees to act other 09 than in the best interests of its clients; 10 (5) compensates its employees in a manner that does not provide an 11 incentive to its employees to act other than in the best interests of its clients; 12 (6) provides or identifies for a borrower residential mortgage loans 13 with terms favorable to the borrower and comparable to mortgage loans and housing 14 assistance provided under government housing assistance programs; for residential 15 mortgage loans to have terms that are favorable to the borrower, the terms must be 16 consistent with mortgage loan origination for a public or charitable purpose, rather 17 than in a commercial context, and provide for interest rates that are less than the 18 current market rate; and 19 (7) meets other standards that the department determines are 20 appropriate. 21 (d) The department may establish by regulation the information that an 22 organization must provide to qualify as a bona fide nonprofit organization under (c) of 23 this section. 24 (e) The department shall establish by regulation 25 (1) the procedure for determining that an organization meets the 26 criteria identified under (c) of this section; 27 (2) the period for which the determination made under (c) of this 28 section remains in effect and the fee to be paid by the organization; 29 (3) how often and under what circumstances the department will 30 examine the books and activities of the organization to determine that the organization 31 continues to meet the criteria identified under (c) of this section; and
01 (4) the procedure for denying an organization the status of a bona fide 02 nonprofit organization, for suspending or revoking an organization's status as a bona 03 fide nonprofit organization if the organization does not continue to meet the criteria 04 identified under (c) of this section, and for taking disciplinary action against an 05 organization arising out of a violation of (c) - (e) of this section; the provisions of 06 AS 44.62 (Administrative Procedure Act) apply to an action of the department under 07 this paragraph. 08 * Sec. 5. AS 06.60.990 is amended by adding a new paragraph to read: 09 (36) "bona fide nonprofit organization" means an organization that the 10 department has determined qualifies as a bona fide nonprofit organization under 11 AS 06.60.015(c). 12 * Sec. 6. The uncodified law of the State of Alaska is amended by adding a new section to 13 read: 14 TRANSITION: REGULATIONS. The Department of Commerce, Community, and 15 Economic Development may adopt regulations necessary to implement the changes made by 16 AS 06.60.015(a)(5), added by sec. 1 of this Act, AS 06.60.015(b)(7), added by sec. 3 of this 17 Act, AS 06.60.015(c) - (e), added by sec. 4 of this Act, and AS 06.60.990(36), added by sec. 5 18 of this Act. The regulations take effect under AS 44.62 (Administrative Procedure Act), but 19 not before the effective date of the section being implemented. 20 * Sec. 7. The uncodified law of the State of Alaska is amended by adding a new section to 21 read: 22 RETROACTIVITY. AS 06.60.015(b)(4), added by sec. 2 of this Act, is retroactive to 23 July 1, 2008. 24 * Sec. 8. Sections 2, 6, and 7 of this Act take effect immediately under AS 01.10.070(c). 25 * Sec. 9. Except as provided by sec. 8 of this Act, this Act takes effect January 1, 2020.