HB 104-MORTGAGE LOAN ORIGINATOR LICENSING  5:27:28 PM CHAIR REINBOLD announced the consideration of HB 104, CS FOR HOUSE BILL NO. 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." 5:27:55 PM REPRESENTATIVE TAMMIE WILSON, Alaska State Legislature, Juneau, paraphrased from the sponsor statement for CSHB 104(L&C)AM: The current Alaska SAFE Act allows a seller to finance his or her residence. If a person had more than one residence (a second home for example) they could sell and finance it themselves without a license under AS 06.60.015(b)(3). If the second home had been rented it would be considered an income property and the seller would be required to have a mortgage loan originator license in order to seller-finance it. CSHB104(L&C) would allow a person to seller-finance up to 5 of their own properties which are secured by a dwelling, whether they are an income property or not. Interior and more rural community property owners have parcels with trailers or cabins on them; some with water and electric, some without. These types of properties are historically difficult to finance through the traditional mortgage process and many times lenders require more money down, shorter loan terms, higher interest rates, and in some cases, will not finance them at all. Those wishing to take on the responsibility of home ownership and establish roots in the community may find, for many reasons, that they do not qualify for a traditional mortgage. Seller financing is another tool that can be utilized to make it affordable for one to realize their dream of having a place they can finally call their home. Seller financing is a reasonable and practical option for both sellers and buyers of these type properties. CSHB 104 would give more opportunity for the dream of home ownership to those who might not otherwise realize it and would relieve the financial burden of bona fide non-profit organizations assisting Alaskans in making their dream come true. 5:29:02 PM SENATOR COSTELLO asked if there were any issues with the retroactivity clause. She asked for further clarification on whether there was a timeframe and if this allowed for financing up to five homes per year. 5:29:26 PM REPRESENTATIVE WILSON agreed the program allowed a person to seller-finance up to five homes per year under the bill. She stated that an amendment was adopted on the House floor to make it retroactive. She clarified that many people in Alaska thought it was possible for sellers to finance properties. 5:30:08 PM SENATOR BISHOP reviewed the fiscal note from the Department of Commerce, Community and Economic Development (DCCED), Banking and Securities for HB 104. 5:30:36 PM At ease. 5:31:07 PM CHAIR REINBOLD called the committee back to order. SENATOR BISHOP continued. The Office of Management and Budget component number 2808. He read the bill analysis: This bill will allow a natural person, estate, trust, corporation, or another entity to self-finance a mortgage loan on five or fewer residential properties owned by the seller during a 12-month period. The mortgage loan must have an interest rate that is fixed, payments that do not result in negative amortization, and cannot impose a prepayment penalty. The seller determines that the purchaser has a reasonable ability to repay the loan. The seller cannot have constructed the dwelling or acted as a contractor for the construction of the dwelling that secures the loan. The bill does not require a change to regulations. The Division of Banking and Securities does not anticipate any fiscal impacts from this legislation. SENATOR BISHOP said the fiscal note was a zero-fiscal note. 5:32:21 PM CHAIR REINBOLD removed her objection. She reaffirmed that public testimony was closed on HB 104. She remarked that she previously held the bill to allow Senator Bishop to participate in the hearing since Fairbanks residents expressed significant interest in the bill. 5:33:16 PM SENATOR COSTELLO moved to report CSHB 104(L&C) AM, version 31- LS0257\S.A. from committee with individual recommendations and attached fiscal note. There being no objection, the motion carried. 5:33:32 PM At ease.