Maryland’s Commissioner of Financial Regulation (Commissioner) recently adopted revised amendments to regulations governing licensed Maryland mortgage lenders, which were originally proposed on March 1, 2019, and are effective October 4, 2019. Among other items, the amendments proposed on March 1 (as recently revised):
- Define “mortgage servicer” to include a person that engages in one or more of the following actions for the benefit of other persons in connection with mortgage loans: (i) collects or receives payments directly from borrowers for distribution to the owner of the mortgage loan or another third party, including a master servicer; (ii) evaluates borrower eligibility for loss mitigation options; (iii) communicates to the borrower regarding loss mitigation options; (iv) is responsible for supervision of third parties that take action to protect a secured party’s interest in the property under the applicable security instrument; or (v) conducts or supervises the foreclosure process, except if the person is an attorney or is acting as a substitute trustee;
- State that if a licensee provides disclosures that comply with RESPA and TILA, then the licensee will be deemed in compliance with the Maryland requirement to provide a financing agreement and a written commitment;
- Clarify that if a renewal application is filed at least two calendar weeks before the license expires, then the licensee may continue to process and close loans until the Commissioner takes final action on the renewal application. However, if a renewal application is filed less than two calendar weeks before the license expires, and the Commissioner has not approved the application prior to the license expiring, then the licensee must cease all licensed activities upon license expiration;
- Establish that electronic or offsite storage of records is considered approved if the licensee completes an attestation form prescribed by the Commissioner and uploads the form to NMLS;
- States that a licensee who utilizes social media for advertising purposes need not disclose the licensee’s NMLS unique identifier in each statement published through a social media platform, provided that the NMLS unique identifier is displayed prominently on the licensee’s profile page within the social media platform; and
- Detail the scope of supervision the Commissioner expects licensees to exercise over MLOs, which include, but are not limited to, the following factors the Commissioner will use to determine whether supervision by the licensee is reasonable and adequate: (i) the availability of experienced supervisory personnel to review and discuss mortgage loan terms, disclosure requirements, and advertising; and (ii) regularly updated policies and procedures that provide adequate guidance to mortgage loan originators in licensing and education requirements, state and federal mortgage lending laws and regulations, including any new requirements or changes to existing requirements.