HF 990

1st Engrossment - 91st Legislature (2019 - 2020) Posted on 04/08/2019 05:52pm

A bill for an act
relating to financial institutions; adding an exemption to licensing requirements
for residential mortgage originators; providing for conformity with federal truth
in lending requirements; amending Minnesota Statutes 2018, section 58.04,
subdivision 1.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

Section 1.

Minnesota Statutes 2018, section 58.04, subdivision 1, is amended to read:

Subdivision 1.

Residential mortgage originator licensing requirements.

(a) No person
shall act as a residential mortgage originator, or make residential mortgage loans without
first obtaining a license from the commissioner according to the licensing procedures
provided in this chapter.

(b) A licensee must be either a partnership, limited liability partnership, association,
limited liability company, corporation, or other form of business organization, and must
have and maintain a surety bond in the amounts prescribed under section 58.08.

(c) The following persons are exempt from the residential mortgage originator licensing
requirements:

(1) a person who is not in the business of making residential mortgage loans and who
makes no more than three such loans, with its own funds, during any 12-month period;

(2) a financial institution as defined in section 58.02, subdivision 10;

(3) an agency of the federal government, or of a state or municipal government;

(4) an employee or employer pension plan making loans only to its participants;

(5) a person acting in a fiduciary capacity, such as a trustee or receiver, as a result of a
specific order issued by a court of competent jurisdiction; deleted text begin or
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(6) a person exempted by order of the commissioner deleted text begin . deleted text end new text begin ; or
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new text begin (7) a manufactured home dealer, as defined in section 327B.01, subdivision 7 or 11b,
or a manufactured home salesperson, as defined in section 327B.01, subdivision 19, that:
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new text begin (i) performs only clerical or support duties in connection with assisting a consumer in
filling out a residential mortgage loan application but does not in any way offer or negotiate
loan terms, or hold themselves out as a housing counselor;
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new text begin (ii) does not receive any direct or indirect compensation or gain from any individual or
company for assisting consumers with a residential mortgage loan application, in excess of
the customary salary or commission from the employer in connection with the sales
transaction; and
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new text begin (iii) discloses to the borrower in writing:
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new text begin (A) any corporate affiliation with a lender; and
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new text begin (B) if an affiliation with a corporate lender exists, that the lender cannot guarantee the
lowest or best terms available and the consumer has the right to choose their lender.
new text end