The California Department of Financial Protection (DFPI) recently adopted a final rule that implements Assembly Bill 1284 and amends the California Financing Law (CFL) to transition all licensees under the CFL onto the NMLS. The final rule, which takes effect on October 1, 2021, also establishes certain requirements relating to the Property Assessed Clean Energy (PACE) program. WBK previously covered the DFPI’s proposed rule here.
The DFPI has long required residential mortgage lenders and brokers to apply for CFL licenses and has administered such licenses through the NMLS. However, CFL licenses for non-residential (i.e., commercial) lenders and brokers have historically been administered outside of the NMLS, and such applicants have had to submit initial applications on a paper “long form” application. Pursuant to the amended regulations, all applicants for licensing under the CFL, including both residential and commercial lenders and brokers, must apply for, and administer such licenses, through the NMLS. The effective date to begin NMLS transition for CFL licensees is October 1, 2021, and the deadline to fully transition existing CFL licensees to the NMLS platform is December 31, 2021.
The final rule also establishes certain requirements for administrators of the PACE program, including requirements related to advertising, training, disclosures, solicitation, record keeping, annual reporting, and handling property owner complaints. For example, among other things, the amendments provide that a PACE program administrator must maintain in its books and records that the PACE solicitor agent completed the introductory training, including passing the required test, and completing six hours of education. In addition, the amendments set forth the list of actions constituting advertising of a PACE program that are considered untrue, deceptive, or likely to mislead a property owner and clarify that such list is non-exclusive.