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| Rule |
Rule 1301:8-7-01 | Definitions.
Effective:
September 1, 2024
Unless otherwise specified, as used in Chapter
1322. of the Revised Code and in this chapter of the Administrative
Code: (A) "Advertisement" and
"advertising" means any written or oral statement, illustration, or
depiction, whether in English or any other language, that is designed to effect
a sale or create interest in purchasing goods or services, whether it appears
on or in a label, package, package insert, radio, television, cable television,
brochure, newspaper, magazine, pamphlet, leaflet, circular, mailer, book
insert, free standing insert, letter, catalogue, poster, chart, billboard,
public transit card, point of purchase display, film, slide, audio program
transmitted over a telephone system, telemarketing script, on-hold script,
upsell script, training materials provided to telemarketing firms,
program-length commercial ("infomercial"), the internet, cellular
network, or any other medium. The term advertisement and advertising includes
web pages and social media posts, but does not include de minimis promotional
items such as pens, pencils, balloons, and coffee mugs. (B) "At the time that the request
for the mortgage is refused or denied" means no later than five business
days from the day that the residential mortgage loan application has been
refused or denied. (C) "Borrower" means an
individual who is assisted by a mortgage loan originator in applying for or
obtaining a residential mortgage loan and includes a buyer. (D) "Clerical or support
duties" has the same meaning as "administrative or clerical
tasks" as defined in division (A) of section 1322.01 of the Revised
Code. (E) "Credit union service organization" means an
entity that a credit union, chartered and lawfully doing business under the
laws of this state, another state, or the United States, invests in or loans to
and that primarily provides products or services to credit unions or their
members. (F) "Financial and mortgage information" means
information about a borrower or potential borrower that is customary or
necessary to include in a residential mortgage loan application. (G) "For compensation or gain" means receives or
expects to receive payment of money or anything of value in connection with the
activities described in paragraph (I)(1) of this rule or as a result of any
residential mortgage loan terms entered into as a result of such
activities. (H) "Leads" means financial and mortgage
information about potential residential mortgage loan borrowers, including
information submitted by potential borrowers who fill out online
questionnaires, contests, or surveys. (I) (1) "Mortgage loan
originator," in accordance with section 1322.02 of the Revised Code,
includes an individual who for compensation or gain, or in anticipation of
compensation or gain, does any of the following: (a) Takes or offers to take a residential mortgage loan
application; (b) Performs the clerical or support duties of a loan
processor or underwriter as an independent contractor. (2) "Mortgage loan
originator" does not include:, : (a) Individuals listed in division (AA)(2) of section
1322.01 of the Revised Code; (b) An employee of a federal, state, or local government
agency or housing finance agency and who acts as a mortgage loan originator
only pursuant to his or her official duties as an employee of the federal,
state, or local government agency or housing finance agency; (c) An employee of a qualified exempt entity who acts
solely as a loan processor or underwriter and who does not represent to the
public, through advertising or other means of communicating, including the use
of business cards, stationery, brochures, signs, rate lists, or other
promotional items, that the employee can or will perform any of the activities
of a mortgage loan originator. (J) "Mortgage broker" includes, in addition to
those persons listed in division (Y) of section 1322.01 of the Revised Code, a
person who is physically located in this state but who regularly provides or
offers to provide mortgage broker services only to borrowers or for property
located in other states. (K) "NMLS" means the "nationwide mortgage
licensing system and registry" or "nationwide multi-state licensing
system" or any subsequent name for the registry adopted by
"Conference of State Bank Supervisors" and the "American
Association of Residential Mortgage Regulators." (L) "Originate," "originating,"
"origination," and "act as a mortgage loan originator" mean
to do any of the acts set forth in paragraph (I)(1) of this rule or in division
(AA)(1) of section 1322.01 of the Revised Code. (M) "Other equivalent consensual security
interest" includes a retail installment sale as that term is defined in
division (A) of section 1317.01 of the Revised Code and a land installment
contract as defined in division (A) of section 5313.01 of the Revised
Code. (N) "Person" includes, without limitation, a
natural person, corporation, limited liability company, partnership,
association, or other entity listed in division (EE) of section 1701.01 of the
Revised Code. (O) "Principally" means more than fifty per cent
of the total time worked in a calendar month, or in a longer period as
determined by the superintendent for good cause shown. (P) "Qualified exempt entity" means a person
holding a valid letter of exemption issued pursuant to section 1322.05 of the
Revised Code. (Q) "Resident of this state" does not include an
individual who is purchasing a primary residence in another state. (R) "Residential mortgage loan application" or
"loan application" means a request, in any form, for an offer (or a
response to a solicitation of an offer) of residential mortgage loan terms, and
the information about the borrower or prospective borrower that is customary or
necessary in a decision on whether to make such an offer. (S) "Settlement service provider" means a person
who provides settlement services as that term is defined in 12 C.F.R. 1024.2,
as in effect on May 1, 2024. (T) "Takes or offers to take a residential mortgage
loan application" means receives a residential mortgage loan application
for the purpose of facilitating a decision whether to extend an offer of
residential mortgage loan terms to a borrower or prospective borrower (or to
accept the terms offered by a borrower or prospective borrower in response to a
solicitation), whether the application is received directly or indirectly from
the borrower or prospective borrower. (U) "Transaction of business as a mortgage broker in
this state" means the origination of a residential mortgage loan in any of
the following circumstances: (1) For any resident of
this state; (2) For any property in
this state; (3) By a person who is
physically located in this state but who regularly provides or offers to
provide mortgage broker services only to borrowers or for property located in
other states.
Last updated September 3, 2024 at 8:45 AM
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Rule 1301:8-7-02 | Registration, letters of exemption for qualified exempt entities, office requirements and restrictions.
Effective:
September 19, 2025
(A) A registrant shall register every
office where any of the following activities occur or conditions
exist: (1) Leads are solicited
or received, directly or indirectly, from residents of this state, for property
in this state, or from a location physically in this state; (2) Records pertaining to
business conducted pursuant to Chapter 1322. of the Revised Code are maintained
in paper form; (3) The registrant's
licensees originate residential mortgage loans for residents of this state,
property in this state, or from a location physically in this state regardless
of the location of the borrower or property; (4) The registrant
transacts business as a mortgage servicer. (B) A qualified exempt entity shall seek
and obtain an approved letter of exemption for every office where any of the
following activities occur or conditions exist: (1) Records pertaining to
business conducted pursuant to Chapter 1322. of the Revised Code are maintained
in paper form; (2) The qualified exempt
entity's licensees originate residential mortgage loans for residents of
this state or property in this state; (3) The qualified exempt
entity transacts business as a mortgage servicer. (C) A registrant or qualified exempt
entity may share office space with another person if: (1) The physical
arrangement does not confuse or mislead borrowers; (2) Access to borrower
files, financial and mortgage information of borrowers or potential borrowers,
and all records required to be maintained by Chapter 1322. of the Revised Code,
whether in electronic or paper form, is restricted to only the
registrant's or qualified exempt entity's employees or licensees, and
is maintained in compliance with applicable state and federal privacy
laws. (3) Notwithstanding
paragraph (C)(2) of this rule, a registrant or qualified exempt entity may
allow an independent contractor licensed pursuant to Chapter 1322. of the
Revised Code or employees of a loan processing or underwriting company holding
a valid letter of exemption issued pursuant to rule 1301:8-7-32 to access
borrower files, financial and mortgage information of borrowers or potential
borrowers, and all records required to be maintained by Chapter 1322. of the
Revised Code, whether in electronic or paper form, for the purpose of
conducting the clerical or support duties of loan processing or underwriting
for the same registrant or qualified exempt entity. (D) The following restrictions and requirements apply to each
additional office location maintained by the registrant, also referred to
herein as branch offices: (1) A branch office shall
not be a separate business entity; (2) A branch office shall
not pay its own operating expenses for the transaction of business as a
mortgage broker in this state. Operating expenses include compensation of
branch office employees, and payments for equipment, furniture, office rent,
utilities, advertising and other similar expenses incurred in operating a
mortgage broker business. All assets and liabilities of the branch are assets
and liabilities of the registrant and all income and expenses of the branch are
income and expenses of the registrant and shall be properly accounted for in
the financial records and state and federal tax returns of the registrant.
Compensation of a branch manager may be based on the income of the branch minus
the operating expenses of the branch as long as the ultimate responsibility and
payment of those operating expenses remains the responsibility of the
registrant; (3) A branch office shall
not indemnify, hold harmless, or defend a registrant against damages, losses,
injury, or liability arising out of acts or omissions of the branch or
employees or licensees working from the branch. (4) A branch office shall
not maintain a bank account for the payment of expenses that is separate from
the bank accounts of the registrant. All operating expenses shall be paid from
an account of the registrant, and may not be paid through or from any
employee's personal account or any non-registrant account; (5) A branch office shall
not maintain its own lines of credit, warehouse agreements, or other investor
agreements that are independent from those of the registrant; (6) All practices,
policies, and procedures, including those relating to employment and
operations, shall be established by the registrant and shall be applied
consistently to the main office and all branch offices. (E) Any arrangement where a registrant allows another person to
transact business as a mortgage broker in this state under the
registrant's certificate of registration at a location that does not
comply with paragraph (D) of this rule, sometimes referred to as "net
branching," is not permissible. (F) A residential mortgage loan is primarily for personal,
family, or household use if more than one half of the total loan amount is used
for consumer purposes and not for business purposes. In assessing the purpose
(or purposes, if the loan is a hybrid used for both consumer and business
purposes), the superintendent may consider the totality of the circumstances
surrounding the loan and not merely the purpose of cash-out proceeds. If more
than one half of the total loan amount is for business purposes, then the
requirements of Chapter 1322. of the Revised Code do not apply. (G) Notwithstanding paragraph (F) of this rule, a residential
mortgage loan made to a borrower for purposes of investing in a dwelling to
either lease, rent, or resell for profit is considered a business purpose loan
and is not subject to the requirements of Chapter 1322. of the Revised Code
unless the dwelling, or at least one unit of the dwelling in the case of a two
to four family housing unit, will be occupied by the borrower or any immediate
family member of the borrower. For the purposes of this paragraph,
"immediate family" has the same meaning as set forth in division (R)
of section 1322.01 of the Revised Code. (H) Nothing in division (AA)(2)(b) of section 1322.01 of the
Revised Code prevents a person licensed under Chapter 4735. of the Revised Code
or similar law of another state from receiving compensation for real estate
brokerage activities performed for a mortgage lender or agent thereof who is
also the owner of the property provided that the person does not act as a
mortgage loan originator in the transaction. (I) A registrant or qualified exempt entity shall not hold a
certificate of registration issued pursuant to Chapter 4712. of the Revised
Code.
Last updated September 19, 2025 at 7:25 AM
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Rule 1301:8-7-03 | Standards for applications, certificates of registration, letters of exemption, and licenses.
Effective:
September 19, 2025
(A) Submitting an application for a certificate of registration,
letter of exemption or license via the NMLS does not authorize the applicant to
begin acting as a registrant, qualified exempt entity, or licensee.
(B) Each question and answer on the NMLS,
including any exhibit or attachment, is material to the application process.
Submitting false or fraudulent information or omitting information is grounds
to refuse to issue the certificate of registration, letter of exemption, or
license and may subject the applicant and individuals who signed and attested
to the application to administrative, civil, or criminal actions. (C) Engaging in mortgage broker, mortgage
servicer, or loan origination activity on or after the first day of January by
a person who fails to submit a renewal application via the NMLS by the
thirty-first day of the preceding December constitutes activity without a
certificate of registration or license in violation of Chapter 1322. of the
Revised Code, and the person engaged in the violation may be subject to
administrative, civil, or criminal actions. In accordance with division (D)(2)
of section 1322.10 of the Revised Code, this paragraph does not apply if the
applicant, not later than forty-five days after the renewal deadline, submits
the renewal fee or additional fee and a one hundred fifty dollar penalty to the
superintendent. (D) Registrants, qualified exempt
entities, licensees, and applicants are responsible for ensuring that all
information maintained on the NMLS is current and accurate. If information on
the NMLS becomes out-of-date or inaccurate for any reason, the registrant,
qualified exempt entity, licensee, or applicant shall correct the information
within ten business days of the change unless a different time frame is
specified in Chapter 1322. of the Revised Code or rule 1301:8-7-19 of the
Administrative Code. (E) Having a sponsorship submitted via the NMLS is not sufficient
to activate a license. To be authorized to originate residential mortgage loans
for a registrant or qualified exempt entity, a current sponsorship request must
be approved by the superintendent and the mortgage loan originator must receive
an active license from the superintendent. (F) An individual or registered loan originator may obtain or
maintain a license in escrow without having a sponsorship submitted via the
NMLS on his or her behalf by a registrant or qualified exempt
entity. (G) An applicant may request the withdrawal of an application for
a certificate of registration, letter of exemption, or license prior to a
determination on the application being made by the superintendent by submitting
a request via the NMLS. The application may only be withdrawn with the
permission of the superintendent. An application withdrawn at the request of
the applicant may only be re-activated within seven calendar days of the
withdrawal for good cause shown and at the discretion of the superintendent. An
applicant may reapply following a withdrawn application. (H) An escrowed or suspended license is subject to all of the
following: (1) Placing a license in
escrow or having a license suspended does not extend or toll the time for
completion of the licensee's continuing education requirements under
section 1322.28 of the Revised Code; (2) An escrowed or
suspended license may be renewed pursuant to division (B) of section 1322.21 of
the Revised Code; (3) An escrowed or
suspended license is subject to suspension, refusal, revocation, or any other
administrative, civil, or criminal actions for conduct occurring before,
during, or after the license was placed in escrow or suspended
status. (I) A suspended certificate of registration or letter of
exemption is subject to all of the following: (1) A suspended
certificate of registration or letter of exemption may be renewed pursuant to
division (C) of section 1322.10 or division (D) of section 1322.05 of the
Revised Code, respectively; (2) A suspended
certificate of registration or letter of exemption is subject to refusal,
revocation, or any other administrative, civil, or criminal actions for conduct
occurring before, during, or after the suspension. (J) A suspended certificate of registration, letter of exemption,
or license may be returned to active status if it meets all of the
following: (1) The superintendent
believes that all conditions which led to the suspension have been
remedied; (2) The registrant,
qualified exempt entity, or licensee is otherwise eligible to hold an active
certificate of registration, letter of exemption, or license. (K) A certificate of registration, letter of exemption, or
license may be surrendered in accordance with the following: (1) A person may
voluntarily surrender a certificate of registration, letter of exemption, or
license unless the person is being investigated by the superintendent or
another financial institution regulatory authority as defined in division (C)
of section 1322.36 of the Revised Code, or a notice of opportunity for a
hearing has been issued by the superintendent in accordance with Chapter 119.
of the Revised Code. A person may surrender by submitting a request via the
NMLS. The certificate of registration, letter of exemption, or license may only
be surrendered with the permission of the superintendent; (2) A surrendered
certificate of registration, letter of exemption, or license is subject to
administrative, civil, or criminal actions for conduct occurring before,
during, or after the surrender and does not impair or affect the obligation of
a pre-existing lawful contract between the registrant, qualified exempt entity,
or licensee and any person, including a borrower.
Last updated September 19, 2025 at 7:25 AM
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Rule 1301:8-7-06 | Recordkeeping.
Effective:
September 19, 2025
(A) In accordance with division (B) of
section 1322.34 of the Revised Code and division (C)(3) of section 1322.05 of
the Revised Code, the four-year retention period commences on the date the
residential mortgage loan is closed or, if the residential mortgage loan is not
closed, the date of the withdrawal or denial of the residential mortgage loan
application. If the residential mortgage loan is serviced by a qualified exempt
entity, the four-year retention period commences on the date the residential
mortgage loan is paid in full or the date the registrant ceases to service the
residential mortgage loan. The retention period for advertisements commences
from the date the advertisements are published, broadcast, or
disseminated. (B) A registrant or qualified exempt
entity shall notify the superintendent via the NMLS of a change of location of
its records pertaining to business conducted pursuant to Chapter 1322. of the
Revised Code no later than five business days after the change. (C) As used in division (E) of section
1322.34 of the Revised Code, "estimated costs of the examination"
includes, in addition to the proportionate costs of the salaries of division of
financial institutions employees who conduct the examination, the
division's travel, lodging, and per diem expenses incurred in travel to
examine the books and records. At the request of the superintendent, payment of
the estimated costs of the examination, as determined by the superintendent,
shall be made in advance and placed on deposit with the division. After actual
costs are determined, any excess funds shall be refunded to the registrant or
qualified exempt entity. (D) All records shall be kept current and
shall be available at all times during normal business hours for review by the
superintendent. Records should be legible and maintained in a type size that is
clearly readable without magnification and in conformity with state or federal
law. Except when otherwise provided by federal or state law, records shall be
maintained in English. When records are allowed to be in a language other than
English, the registrant or qualified exempt entity, at its expense, shall be
responsible for providing the superintendent with a full and accurate
translation. For purposes of this rule, "current" means within thirty
days from the date of the occurrence of the event required to be
recorded. (E) A registrant or qualified exempt
entity shall segregate the records pertaining to business conducted pursuant to
Chapter 1322. of the Revised Code from all other business records. (F) Records pertaining to business
conducted pursuant to Chapter 1322. of the Revised Code may be maintained in
their original paper form or on an electronic storage media or system. Any
records maintained on an electronic storage media or system shall meet all of
the following requirements: (1) The electronic
storage media or system must preserve the records in a non-rewriteable,
non-erasable format; (2) The electronic
storage media or system must verify automatically the quality and accuracy of
the storage media recording process; (3) The electronic
storage media or system must serialize the original and the duplicate units of
storage media, and affix a date and time for the required period of retention
on both the original and duplicate; (4) The electronic
storage media or system must have the capacity to readily download indices and
records preserved on the electronic storage media or system to any medium
acceptable to the superintendent; (5) Acceptable facilities
and appropriate equipment must, at all times during normal business hours, be
available to the superintendent for immediate, easily readable projection or
production of electronic storage media or system images and for producing
easily readable images; (6) Immediate facsimile
enlargement must be available upon the superintendent's
request; (7) A duplicate copy of
the electronic record stored on any electronic media or system for the time
required must be stored separately from the "original" electronic
record; (8) The electronic
storage media or system must organize and index accurately all information
maintained on both the original and duplicate storage media or system. At all
times, a registrant or qualified exempt entity must be able to have indices of
the electronic records being stored available for examination by the
superintendent. Each index must also be duplicated and the duplicate copies
must be stored separately from the original copy of each index. Original and
duplicate indices must be preserved for the time required for the indexed
records; (9) An audit system will
be in place providing for accountability regarding inputting of records and
inputting any changes made to every original and duplicate record maintained
and preserved. At all times, a registrant or qualified exempt entity must be
able to have the results of the audit system available for examination by the
superintendent. The audit results must be preserved for the time required for
the audited records; (10) All information
necessary to access records and indices stored on the electronic storage media
or system, a copy of the physical and logical file format of the electronic
storage media or system, the field format of all different information types
written on the electronic storage media or system, together with the
appropriate documentation and information necessary to access records and
indices will be maintained, kept current, and provided promptly to the
superintendent, upon request; (11) No paper documents produced or
reproduced by means of an electronic storage media or system shall be destroyed
until the conditions of this paragraph have been met with regard to each paper
document that is to be destroyed; and (12) At the request of the division, the
records shall be printed on paper for inspection or examination without cost to
the division within forty-eight hours of the request. The superintendent may
grant additional time for good cause shown upon receipt of a request for
additional time from the registrant or qualified exempt entity. (G) A registrant or qualified exempt
entity shall create, maintain, keep current, and preserve the following books
and records: (1) A searchable
electronic spreadsheet of all borrowers for whom the registrant or qualified
exempt entity has obtained residential mortgage loans. The spreadsheet shall
contain for each borrower the closing date of the residential mortgage loan
obtained for the borrower, the amount of the residential mortgage loan, the
licensee responsible for originating the residential mortgage loan, the
identity of the lender that funded or purchased the residential mortgage loan,
the residential mortgage loan application date, the residential mortgage loan
program type, the property address, and the identifying loan
number; (2) A borrower file for each application
received which shall contain, when applicable, at least the
following: (a) A copy of the initial and final residential mortgage loan
applications signed and dated by the borrower and the licensee originating the
residential mortgage loan, including any attachments, supplements, or addenda
thereto; (b) Copies of verification documentation, including written
authorizations to order credit reports, income verifications, deposit and asset
verification, all copies of the credit reports and any supplements to the
credit report, and any correspondence to any person regarding credit
repair; (c) Copies of written or electronic communications, including
underwriting decisions, opinions, or prequalification correspondence, interest
rate lock-ins, residential mortgage loan commitments, and notes in connection
with that residential mortgage loan application or its ultimate
disposition; (d) Copies of all state and federal disclosures or forms
applicable to the borrower, both initial and any revised versions. (e) A copy of each appraisal and the corresponding appraisal
invoice and order form; and (f) Receipts or other documentation for any fees collected by the
registrant or qualified exempt entity from the borrower for payment to bona
fide, third-party service providers. (3) A file of all
advertisements. (4) General business records,
including: (a) All agreements with lenders to whom residential mortgage loan
applications are submitted; (b) All checkbooks, check registers, bank statements, deposit
slips, withdrawal slips, and canceled checks or electronic images; (c) Copies of checks made payable to a registrant or qualified
exempt entity from a borrower or other entity paying a fee for the services of
the registrant, qualified exempt entity, or licensee; (d) Documentation to support the source of and purpose for each
receipt and disbursement of funds in order that the receipts may be reconciled
to bank deposits and to the books of the registrant or qualified exempt entity.
Settlement statements are not acceptable proof of receipt for purposes of this
rule; (e) Copies of all federal tax withholding forms, reports of
income for federal taxation, and evidence of payments to all employees,
independent contractors and others compensated by the registrant or qualified
exempt entity in connection with the conduct of mortgage lending
business; (f) Copies of all contractual arrangements or understandings with
employees, independent contractors, and third parties that relate in any way to
the providing of residential mortgage broker or mortgage lending services,
including any agreements for the pricing of goods or services, any investor
contracts, any employment agreements, and any non-compete
agreements; (g) Copies of organizational documents, including articles of
incorporation, corporate minutes, and documents evidencing corporate name
changes and change of ownership or officers; and (h) Such other books and records as the superintendent may
require. (H) A registrant or qualified exempt
entity shall comply with rules promulgated under 15 U.S.C. 1681w and 15 U.S.C.
6801, including 16 C.F.R. Part 313 and 16 C.F.R. Part 682, as those rules are
in effect May 1, 2024. (I) (1) A mortgage servicer
will retain records that document actions taken with respect to a
borrower's residential mortgage loan account until four years after the
date a residential mortgage loan is discharged or servicing of a residential
mortgage loan is transferred by the mortgage servicer to a transferee mortgage
servicer. (2) A mortgage servicer
will maintain the following documents and data on each residential mortgage
loan account serviced by the mortgage servicer in a manner that facilitates
compiling such documents and data into a servicing file within five days of a
borrower's request: (a) A schedule of all transactions credited or debited to
the residential mortgage loan account, including any escrow account as defined
in 12 C.F.R. 1024.17(b) as is in effect June 1, 2025, and any suspense
account; (b) A copy of the security instrument that establishes the
lien securing the residential mortgage loan; (c) Any notes created by mortgage servicer personnel
reflecting communications with the borrower about the residential mortgage loan
account; (d) To the extent applicable, a report of the data fields
relating to the borrower's residential mortgage loan account created by
the mortgage servicer's electronic systems in connection with servicing
practices; (e) Copies of any information or documents provided by the
borrower to the mortgage servicer in accordance with the procedures set forth
in rule 1301:8-7-38 of the Administrative Code and, for a mortgage servicer
that is not a small servicer as defined in 12 C.F.R. 1026.41(e)(4) as in effect
on June 1, 2025, 12 C.F.R. 1024.41, as in effect on June 1, 2025. (3) As used in paragraph
(I) of this rule, "escrow account" and "transferee mortgage
servicer" have the same meanings as in rule 1301:8-7-35 of the
Administrative Code.
Last updated September 19, 2025 at 7:25 AM
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Rule 1301:8-7-07 | Advertising.
Effective:
September 1, 2024
(A) Every advertisement placed, or caused
to be placed, by a registrant or licensee shall, in manner or form that is
reasonably understandable to the average borrower: (1) State the name of the
registrant as printed on its certificate of registration. If a registrant has
been approved by the superintendent to conduct business using a trade name or
fictitious name, the registrant may use its name, trade name, or fictitious
name, or any combination of them, as they appear on its certificate of
registration; (2) State the
registrant's certificate of registration number and NMLS unique
identifier; (3) State the full name
or other names of the licensee as listed on the NMLS consumer access website,
the licensee's license number, and NMLS unique identifier whenever a
licensee's name is placed in an advertisement; and (4) State the
registrant's office address as listed on the registrant's certificate
of registration. (B) For purposes of paragraph (A)(2) of
this rule, a registrant may opt to state only its NMLS unique identifier in
lieu of stating both its certificate of registration number and NMLS unique
identifier. (C) For purposes of paragraph (A)(3) of
this rule, a licensee may opt to state only the licensee's NMLS unique
identifier in lieu of stating both the licensee's license number and NMLS
unique identifier. (D) It is a violation for a registrant to fail to update
its website within thirty calendar days after any information becomes outdated
or expired. (E) It is a violation for a registrant or licensee to place
or cause to be placed any advertisement that contains any material
misrepresentation regarding any term of a residential mortgage loan,
including: (1) Guaranteeing or
implying that residential mortgage loans will be approved or closed in an
unreasonably short period of time given market conditions at the time of the
advertisement. (2) Indicating that
special terms, reduced rates, guaranteed rates, particular rates or any other
special feature of residential mortgage loans are available unless the
advertisement clearly states any limitations that apply. (3) Using unqualified
superlatives including "lowest rates," "lowest costs,"
"lowest payment plan," or "cheapest loans," or that makes
offers that cannot be reasonably fulfilled or substantiated. (4) Using the words
"new" or "reduced" or similar words in connection with
costs for more than ninety days after the costs become effective. (5) Indicating that
residential mortgage loans are available to borrowers with "previous
bankruptcy," "no credit," "bad credit," or the like
unless the advertisement clearly explains any limitations that apply, or states
that "certain limitations apply, call for details." In any written
advertisement, the actual limitations or the warning that "certain
limitations apply, call for details" shall be clearly
legible. (6) Using an official
government design, format, symbol, logo, or seal unless its use is required or
allowed by the governmental entity. (7) Using the name of a
person or entity that confuses or misleads a borrower as to the true identity
of the registrant placing or sending the advertisement regardless of any
statement elsewhere in the advertisement identifying the true identity of the
registrant or licensee. (F) A violation of 12 C.F.R. 1014.2, 1014.3, or 1014.4, as
in effect on May 1, 2024, shall constitute a violation of this
rule. (G) The provisions in this rule apply to licensees employed
by or associated with qualified exempt entities. (H) Written or oral statements that are purely
informational and not designed to effect or create interest in purchasing the
services of a registrant or licensee are not subject to this rule.
Last updated September 3, 2024 at 8:46 AM
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Rule 1301:8-7-12 | Operations manager.
Effective:
September 1, 2024
(A) A registrant shall grant sufficient
authority to its operations manager to carry out the duty of ensuring that the
daily operations and management of the registrant's business complies with
all state and federal laws, rules, and regulations applicable to the
transaction of mortgage broker business. (B) Only one individual may be designated
as operations manager regardless of the number of registered office locations
or employees. (C) No individual shall act as an
operations manager without being approved by the superintendent. An individual
may be designated to act as an operations manager subject to the
superintendent's approval. The registrant shall submit a completed
"Application to change Mortgage Broker Operations Manager" form to
the superintendent within ten business days of the designation. (D) To qualify for approval as an
operations manager, the superintendent shall find that the individual possesses
at least three years of experience in the mortgage and lending field that
complies with paragraph (F) of this rule. (E) For purposes of demonstrating
compliance with paragraph (D) of this rule and division (B) of section 1322.12
of the Revised Code, a registrant shall, along with the application referenced
in paragraph (C) of this rule, submit satisfactory proof of experience for the
individual designated to act as operations manager. Such proof may include the
following: (1) A current
resume; (2) Copies of IRS form W-2s for the tax
years covering the experience requirement; and (3) A completed and signed release and
authorization which enables the superintendent to verify the W-2s. The experience requirement in division (B) of
section 1322.12 of the Revised Code may be verified by the division directly
with the employer and tax authorities. The superintendent may request any
additional documents or information that may be necessary to verify the
experience requirement. (F) For purposes of paragraph (D) of this
rule and division (B) of section 1322.12 of the Revised Code, the three years,
or thirty-six months, of experience shall have been gained lawfully within the
six years preceding request for approval, but does not need to have been gained
during consecutive months. The division counts each month toward the three year
requirement. A fractional month of experience, at least twenty days long,
qualifies as a full month. The experience may have been gained by directly
soliciting, processing, placing and negotiating residential mortgage loans for
or as a mortgage broker, or with a financial institution, mortgage lending
institution, or other lending institution. The individual should have had
direct contact and interaction with borrowers during all phases of making or
brokering residential mortgage loans, and not compartmentalized experience in
one phase of the process. Experience in all phases of processing, underwriting
and closing or operations management is acceptable. Other experience related
specifically to the business of residential mortgage lending may qualify, but
will not include the following types of employment: (1) Real estate
salesperson or broker; (2) Real estate
appraiser; (3) Real estate developer
or contractor; (4) Real estate owner or
investor; (5) Commercial or
consumer lender; (6) Title or escrow
agent, owner or company; (7) Certified public
accountant, public accountant, accountant, controller, comptroller, or fiscal
officer; (8) Certified financial
planner or similar designation; (9) Professor, teacher,
or presenter of classes, courses, or seminars regarding mortgage
lending; (10) Board member or
senior officer of a financial or mortgage lending institution; (11) Shareholder,
partner, or member of a financial or mortgage lending institution; (12) Insurance
salesperson or broker; (13) Securities
salesperson, broker, or principal; (14) Department store
credit department, including retail and wholesale stores; (15) School, college, or
university credit or student loan department; (16) Automobile,
motorcycle, boat, or recreational vehicle dealer credit
department. (17) Mobile home or
manufactured housing lending or credit department, unless acting as a licensed
loan originator or mortgage loan originator. (G) Any individual who wishes to present
experience or education which is not in accord with paragraphs (E) and (F) of
this rule may petition the superintendent to consider alternative education or
experience which the individual reasonably believes would satisfy the
experience requirement. Such petition should include documentation of the
experience at issue and a detailed explanation of its relationship to
residential mortgage lending activities. The determination of whether to accept
alternative education or experience is within the sole discretion of the
superintendent. (H) An individual designated as
operations manager shall have passed the written test administered to mortgage
loan originators. No separate written test for operations managers is
required.
Last updated September 3, 2024 at 8:46 AM
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Rule 1301:8-7-13 | Division examinations and investigations.
Effective:
September 1, 2024
(A) The superintendent or authorized
division personnel may conduct an examination in accordance with division (A)
of section 1322.34 of the Revised Code or an investigation in accordance with
division (B) of section 1322.50 of the Revised Code during normal business
hours and as often as the superintendent determines appropriate. Examinations
and investigations may be scheduled or unscheduled, announced or
unannounced. (B) The superintendent or authorized
division personnel shall be given free access to all offices, places of
business, computers, books, papers, and records, whether electronic or
hardcopy, in the possession, control or ownership of any registrant, qualified
exempt entity, and their employees and licensees for the purpose of conducting
an examination or investigation in accordance with Chapter 1322. of the Revised
Code and this chapter. (C) As part or in furtherance of any examination or
investigation conducted in accordance with Chapter 1322. of the Revised Code or
this rule chapter, if the superintendent or authorized division personnel
requests a written response, or the submission of books, papers, and records,
whether electronic or hardcopy, or any other information, the applicant,
registrant, qualified exempt entity, licensee, or person shall deliver a
written response and any requested information within the time period specified
in the request. If no time period is specified, the written response and any
required submissions shall be delivered to the superintendent not later than
thirty days after the date of such request. The determination of whether any
response is satisfactory is within the sole discretion of the superintendent.
Last updated September 3, 2024 at 8:47 AM
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Rule 1301:8-7-14 | Surety bonds.
Effective:
September 1, 2024
(A) With respect to a bond obtained by a
registrant, or by a qualified exempt entity or loan processing or underwriting
company in the same manner as a registrant, the following shall
apply: (1) The surety bond
required by section 1322.32 of the Revised Code shall be on a form acceptable
to the superintendent. (2) The surety bond must
be issued in the name of the registrant, qualified exempt entity, or loan
processing or underwriting company and list the main office of the registrant,
qualified exempt entity, or loan processing or underwriting company. If a trade
or fictitious name is used, the trade or fictitious name shall be included on
the bond. (3) One surety bond in
the appropriate aggregate amount shall be required to cover a registrant,
qualified exempt entity, or loan processing or underwriting company regardless
of the number of registered or exempted office locations. An endorsement rider
may be used to increase or decrease the amount of the bond whenever an office
location is established or closed. (4) Whenever the penal
sum of the surety bond is reduced below the required amount, the registrant,
qualified exempt entity, or loan processing or underwriting company and
licensees employed by or associated with them shall immediately cease
originating residential mortgage loans until the bond has been restored to the
full required value. Failure to restore the bond to the full required value
within thirty days of the first date the penal sum of the bond was reduced is
grounds for a fine, suspension, refusal to renew or revocation of the
registrant's certificate of registration or a qualified exempt
entity's or loan processing or underwriting company's approved letter
of exemption. (B) No licensee shall perform the
clerical or support duties of a loan processor or underwriter in this state as
an employee of a loan processing or underwriting company or as an independent
contractor, unless either the licensee, or the loan processing or underwriting
company on the licensee's behalf, has obtained and maintains in effect at
all times a corporate surety bond issued by a bonding company or insurance
company authorized to do business in this state. (C) With respect to an individual bond obtained by a
licensee employed by or associated with a qualified exempt entity, by a
licensee employed by a loan processing or underwriting company on a
licensee's behalf, or by a licensee acting as an independent contractor
performing clerical or support duties of a loan processor or underwriter , the
following shall apply: (1) The surety bond
required by section 1322.32 of the Revised Code shall be on a form acceptable
to the superintendent; (2) The surety bond must
be issued in the name of the licensee and state the home address of the
licensee as listed in the licensee's NMLS account. (D) The surety bond required by division
(A)(1) of section 1322.32 of the Revised Code shall be in the penal sum of
one-half per cent of the aggregate loan amount of all residential mortgage
loans originated within and outside this state in the immediately preceding
calendar year, but not exceeding one hundred fifty thousand
dollars.
Last updated September 3, 2024 at 8:47 AM
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Rule 1301:8-7-15 | Disclosures.
Effective:
September 1, 2024
The affiliated business disclosure referenced in
division (A)(1) of section 1322.42 of the Revised Code shall comply with 12
C.F.R. 1024.15(b), as in effect May 1, 2024, and be made in conformity with the
timing specified in 12 C.F.R. 1024.15(b)(1), as in effect May 1, 2024.
Last updated September 3, 2024 at 8:47 AM
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Rule 1301:8-7-16 | Prohibited practices.
Effective:
September 19, 2025
Conduct that constitutes improper, fraudulent, or
dishonest dealings under division (C) of section 1322.40 of the Revised Code
includes the following: (A) Failing to return all original
documents provided to the registrant or licensee by the borrower; (B) Permitting an unlicensed individual
to originate residential mortgage loans; (C) Sharing or splitting any commission,
discount, fee, or other compensation for originating a residential mortgage
loan with a person who is not licensed or registered under Chapter 1322. of the
Revised Code but who should be licensed or registered; (D) Knowingly aiding, abetting, or
conspiring with a person to circumvent the requirements of Chapter 1322. of the
Revised Code or this rule chapter; (E) Recommending or encouraging default
or delinquency, or continuation of an existing default or delinquency, by a
borrower on any existing indebtedness prior to closing a residential mortgage
loan which refinances all or a portion of such existing
indebtedness; (F) Promising to refinance a residential
mortgage loan in the future at a lower interest rate or with more favorable
terms; (G) Materially underestimating closing
costs; (H) Depositing any residential mortgage
loan disbursement check that is not made payable to the registrant, qualified
exempt entity, or licensee; (I) Abandoning or improperly disposing of
loan files containing financial and mortgage information of
borrowers; (J) Refusing or failing to fund a
consummated loan, other than when an borrower rescinds the loan in accordance
with 12 C.F.R. 1026.15 or 1026.23 (relating to the right of rescission), as in
effect on May 1, 2024; (K) Evading the limits on points and fees
for qualified mortgages set forth in 12 C.F.R. 1026.43(e)(3), as in effect on
May 1, 2024, by conducting business in conjunction with a person registered or
who should be registered pursuant to Chapter 4712. of the Revised Code.
Assisting a borrower with improving his or her credit record, history, or
rating as well as removing adverse credit information are considered part of
the normal activities of a registrant or qualified exempt entity; (L) (1) A mortgage servicer
assessing on a borrower a premium charge or fee related to force-placed
insurance unless both of the following apply: (a) The mortgage servicer has a reasonable basis to believe
that the borrower has failed to comply with the residential mortgage loan
contract's requirement to maintain hazard insurance; (b) The mortgage servicer delivers or mails to the borrower
a written notice at least forty-five days before assessing such charge or
fee. (2) As used in this
paragraph, "force-placed insurance" means hazard insurance obtained
by a mortgage servicer on behalf of the owner or assignee of a mortgage loan
that insures the property securing such loan, but does not include any of the
following: (a) Hazard insurance required by the federal Flood Disaster
Protection Act of 1973, 87 Stat. 975, 42 U.S.C. 4002 et seq., as in effect on
June 1, 2025; (b) Hazard insurance obtained by a borrower but renewed by
the borrower's mortgage servicer as described in 12 C.F.R. 1024.17(k)(1),
(2), or (5), as in effect on June 1, 2025; (c) Hazard insurance obtained by a borrower but renewed by
the borrower's mortgage servicer at its discretion, if the borrower
agrees. (3) As used in paragraph
(L) of this rule, "hazard insurance" means insurance on the property
securing a residential mortgage loan that protects the property against loss
caused by fire, wind, flood, earthquake, theft, falling objects, freezing, and
other similar hazards for which the owner or assignee of such residential
mortgage loan requires insurance. (M) A mortgage servicer directly or
indirectly employing any scheme, device, or artifice to defraud or mislead a
borrower or mortgage lender or to defraud any person; (N) A mortgage servicer misrepresenting
or omitting any material information in connection with the servicing of a
residential mortgage loan, including misrepresenting the amount, nature, or
terms of any fee or payment due or claimed to be due on a residential mortgage
loan, the terms and conditions of the servicing agreement, or the
borrower's obligations under the residential mortgage loan; (O) A mortgage servicer failing to apply
payments in accordance with a servicing agreement or the terms of a
note; (P) A mortgage servicer making payments
in a manner that causes a policy of insurance to be canceled or causes property
taxes or similar payments to become delinquent; (Q) (1) A mortgage servicer
failing to credit a periodic payment to the borrower's account as of the
date of receipt, except when a delay in crediting does not result in any charge
to the borrower or in the reporting of negative information to a consumer
reporting agency, or except as provided in paragraph (Q)(3) of this rule. For
purposes of this rule, a periodic payment is an amount sufficient to cover
principal, interest, and escrow for a given billing cycle. A payment qualifies
as a periodic payment even if it does not include amounts required to cover
late fees, other fees, or non-escrow payments a mortgage servicer has advanced
on a borrower's behalf. (2) In the case of a
mortgage servicer that retains a partial payment in a suspense or unapplied
funds account, upon accumulation of sufficient funds to cover a periodic
payment in any suspense or unapplied funds account, failing to treat such funds
as a periodic payment received in accordance with paragraph (S)(1) of this
rule; (3) If a mortgage
servicer specifies in writing requirements for the borrower to follow in making
payments, but accepts a payment that does not conform to the requirements,
failing to credit the payment as of five days after receipt. (4) As used in paragraph
(Q) of this rule, "partial payment" means a payment that is less than
a periodic payment. (R) A mortgage servicer requiring any amount of money to be
remitted by means which are more costly to the borrower than a bank or
certified check or attorney's check from an attorney's account to be
paid by the borrower; (S) A mortgage servicer failing to satisfy a claim, related
to activity conducted pursuant to Chapter 1322. of the Revised Code, that has
been reduced to a judgment; (T) A mortgage servicer commingling the money or property
of a borrower or mortgage lender with the money or property of the mortgage
servicer, or converting the money or property of another person to the mortgage
servicer's own use; (U) A mortgage servicer charging a fee for any of the
following: (1) Handling a borrower
dispute; (2) Facilitating routine
borrower collection; (3) Arranging a repayment
or forbearance plan; (4) Sending a borrower a
notice of nonpayment; (5) Updating records to
reinstate a residential mortgage loan. (V) A mortgage servicer imposing a late fee or delinquency
charge for a payment if both of the following apply: (1) Such a fee or charge
is attributable solely to failure of the borrower to pay a late fee or
delinquency charge on an earlier payment; (2) The payment is
otherwise a periodic payment received on the due date, or within any applicable
courtesy period. (W) Any other conduct the superintendent determines
constitutes improper, fraudulent, or dishonest dealings.
Last updated September 19, 2025 at 7:26 AM
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Rule 1301:8-7-18 | Continuing education.
Effective:
September 1, 2024
(A) In accordance with division (C)(2) of
section 1322.28 of the Revised Code, a licensee or applicant to become a
licensee shall be permitted to receive credit for a continuing education course
in a year other than the year in which the course is taken in order to make up
a deficiency in continuing education. (B) A licensee or applicant to become a
licensee shall make up any continuing education deficiency that occurred on or
after January 1, 2010, regardless of the number of years that have passed since
the violation. (C) Paragraph (D) of rule 1301-1-04 of
the Administrative Code, which permits an extension of the current continuing
education reporting requirement for veterans meeting all of the criteria set
forth in that rule, applies to the continuing education requirements in section
1322.28 of the Revised Code.
Last updated September 3, 2024 at 8:47 AM
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Rule 1301:8-7-19 | Notification requirements.
Effective:
September 1, 2024
The notification requirements in this
administrative rule shall be made via the NMLS unless otherwise indicated. If
notice of a change is required to be made before its effective date, the
registrant or qualified exempt entity shall submit an "advance change
notice" via the NMLS. (A) A registrant or qualified exempt
entity shall notify the superintendent at least fifteen days before the sale,
transfer, or hypothecation of more than five per cent of the registrant's
or qualified exempt entity's membership, partnership, or other equitable,
beneficial, or ownership interest. (B) A registrant or qualified exempt
entity shall notify the superintendent at least fifteen days before changing
any officers, control persons, or five per cent or more direct owners. New
officers, control persons or five per cent or more direct owners that are
individuals must be fingerprinted for the compilation of a criminal history
background report by the federal bureau of investigation. (C) A registrant or qualified exempt entity shall notify
the superintendent at least fifteen days before changing its name, trade name,
or fictitious name. (D) A registrant or qualified exempt entity shall notify
the superintendent at least fifteen days before changing the name or address of
its statutory agent on file with the Ohio secretary of state. (E) A registrant or qualified exempt entity shall notify
the superintendent of a change of any office location listed on any of its
certificates of registration or letters of exemption at least fifteen days
before such change, and shall submit all of the following to the superintendent
by uploading the documentation into its NMLS account or sending it directly to
the division via mail: (1) A copy of the lease
or rental agreement for the new location or proof that the registrant or
qualified exempt entity owns the new location; (2) An updated surety
bond, rider or endorsement reflecting the new address if its main office
location has changed; (F) A registrant or qualified exempt entity shall notify
the superintendent of the termination of a licensee by removing its sponsorship
of the licensee via the NMLS no later than five business days after the
licensee's employment or association has been terminated. (G) A registrant or qualified exempt entity shall notify
the superintendent of the closure of any office location listed on a
certificate of registration or letter of exemption no later than fifteen days
after the closure. The registrant or qualified exempt entity shall identify the
custodian of the records and the location where the records will be maintained
in compliance with rule 1301:8-7-06 of the Administrative Code. (H) A licensee shall notify the superintendent of a legal
name change no later than fifteen days after such change and shall provide to
the superintendent a copy of the name change order. Once the superintendent has
issued a new license with the licensee's new name, the licensee shall not
originate loans using the prior name. (I) A person notifying the superintendent of a criminal
conviction, guilty or nolo contendere plea, or revocation of the authority to
act as a mortgage lender, mortgage servicer, mortgage broker, or mortgage loan
originator in accordance with division (D) of section 1322.40 of the Revised
Code shall submit a completed "Notification of Guilty Plea, Conviction or
Revocation" form located on the division's website. The form shall be
accompanied by a certified copy of the final judgment entry and supporting
opinion, if any.
Last updated September 3, 2024 at 8:48 AM
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Rule 1301:8-7-20 | Compensation.
Effective:
September 1, 2024
(A) Compensation of any kind paid to a
licensee employed by or associated with a registrant or qualified exempt entity
shall be: (1) Paid by check or
electronic draft; (2) Paid from the account
of the registrant or qualified exempt entity, or account of a third party
payroll administrator acting as the registrant's or qualified exempt
entity's agent; and (3) Paid or made payable
to the licensee in the licensee's legal name. (B) A registrant or qualified exempt
entity may compensate a licensee or former licensee in accordance with
paragraph (A) of this rule after the expiration, cancellation, surrender, or
transfer of the individual's license only for those origination activities
performed while the individual was sponsored by the registrant or qualified
exempt entity via the NMLS, provided the registrant or qualified exempt entity
shall document to the superintendent's satisfaction that such compensation
was for origination activities occurring during such sponsorship. (C) A registrant or qualified exempt entity shall not pay
compensation of any kind to a loan processor or to any individual in a manner
designed to circumvent the licensing requirement of division (B)(1) of section
1322.02 of the Revised Code. (D) Registrants, qualified exempt entities, and licensees shall
comply with the loan originator compensation regulations set forth in 12 C.F.R.
part 1026, as in effect on May 1, 2024.
Last updated September 3, 2024 at 8:48 AM
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Rule 1301:8-7-21 | Character, general fitness, and financial responsibility.
Effective:
September 1, 2024
(A) In determining whether a person has
the character and general fitness to command the confidence of the public and
warrant the belief that the business will be operated honestly and fairly in
compliance with the purposes of Chapter 1322. of the Revised Code and the rules
adopted thereunder, the superintendent may consider, among other things,
whether the person or an owner, officer or director thereof, has: (1) Been convicted of, or pled guilty or
nolo contendere in any court of competent jurisdiction to any
felony; (2) Been convicted of, or pled guilty or
nolo contendere in any court of competent jurisdiction to any misdemeanor
within seven years of the date of application; (3) Been found liable in any court of
competent jurisdiction for acts or omissions relating to residential or
commercial mortgage lending services, real estate services, or any other
financial products or services; (4) Been refused or denied a professional
registration or license by any state or federal agency granted disciplinary or
regulatory authority by state or federal law; (5) Had a professional license or
registration suspended or revoked by any state or federal agency granted
disciplinary or regulatory authority by state or federal law, including being
placed on the HUD limited denials of participation list pursuant to 2 C.F.R.
part 2424, as in effect on January 12, 2014; (6) Been issued a cease and desist order
or had a fine imposed by any court of competent jurisdiction or by any state or
federal agency granted disciplinary or regulatory authority by state or federal
law for conduct relating to a professional license or
registration; (7) Violated any provision of Chapter
1321., 1322., 4712., 4727., or 4728. of the Revised Code or sections 1315.21.
to 1315.30, 1345.031, or 1349.25 to section 1349.35 of the Revised Code or any
rules promulgated thereto; (8) Engaged in any conduct which would
reflect negatively on the honesty or business repute of the person, including
the failure to provide complete and accurate information concerning the
person's past; or (9) A pattern of disregard of the laws of
this state, another state, or the United States. (B) In determining whether a person has
the financial responsibility to command the confidence of the public and
warrant the belief that the business will be operated honestly and fairly in
compliance with the purposes of Chapter 1322. of the Revised Code and the rules
adopted thereunder, the superintendent may consider, among other things,
whether the person, or an owner, officer or director thereof, has: (1) Any current outstanding civil or
criminal judgments for money, restitution, or damages of any kind; (2) Any current
outstanding tax liens or other government liens; (3) A foreclosure filed
within the past five years whether residential or commercial; (4) A bankruptcy filed
within the past five years; (5) Any current accounts that are past
due, in collection, or charged off, and which in the aggregate exceed five
thousand dollars. (C) In assessing financial responsibility pursuant to paragraph
(B) of this rule, the superintendent may consider mitigating factors,
including: (1) Involuntary loss of
job or income; (2) Divorce; (3) Involuntary medical
expenses incurred by the person or the person's spouse or
dependent; (4) Certified copies of satisfactions of
judgments, tax liens or other government liens; (5) Certified copies of bankruptcy
discharge orders, schedules, or dismissal documents; (6) Written evidence of a repayment plan
or agreement with creditors; or (7) Any other information the
superintendent believes reflects circumstances beyond the control of the
person.
Last updated September 3, 2024 at 8:48 AM
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Rule 1301:8-7-22 | Trade names, fictitious names and change of names.
Effective:
September 1, 2024
(A) A registrant or qualified exempt
entity may, with the prior approval of the superintendent, use a trade name or
fictitious name, provided: (1) The trade name or
fictitious name complies with division (A)(1) of section 1101.15 of the Revised
Code; and (2) The trade name is
registered with or the fictitious name is reported to the Ohio secretary of
state in accordance with Chapter 1329. of the Revised Code. (B) The superintendent may refuse to
issue a certificate of registration or letter of exemption to use a name, trade
name or fictitious name if the superintendent believes that such name would
create a substantial risk of misleading or confusing the public. (C) In closing documents and in any
disclosures made pursuant to Chapter 1322. of the Revised Code or this rule
chapter, a registrant or qualified exempt entity shall use the same name, trade
name, or fictitious name that it has used during all of its contacts with the
borrower involved in the transaction. (D) A registrant or qualified exempt
entity may change its name, trade name, or fictitious name,
provided: (1) It complies with
paragraphs (A) and (B) of this rule; (2) It submits proof that
the surety bond has been issued in the new name unless, in the case of a
qualified exempt entity, the bond is obtained by individual mortgage loan
originators; and (3) It has given the
superintendent prior notice in accordance with paragraph (C) of rule
1301:8-7-19 of the Administrative Code.
Last updated September 3, 2024 at 8:48 AM
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Rule 1301:8-7-23 | Mortgage broker appraisal misconduct.
Effective:
September 1, 2024
(A) A violation of division (G) of
section 1322.40 of the Revised Code may include the following: (1) In the case of any
refinance of a residential mortgage loan or non-purchase second residential
mortgage loan, a person states on the appraisal order form or communicates,
directly or indirectly, to any person licensed or certified under Chapter 4763.
of the Revised Code either the loan amount or any other express or implied
statement of the anticipated or desired appraisal value; (2) In the case of any
purchase money residential mortgage loan including any second residential
mortgage loan connected to a sale transaction, a person states on the appraisal
order form or communicates, directly or indirectly, to any person licensed or
certified under Chapter 4763. of the Revised Code either the loan amount or any
other express or implied statement of the anticipated or desired appraisal
value. However, it is not a violation if the sales price of the property is
disclosed or a copy of the signed purchase contract is provided to a person
licensed or certified under Chapter 4763. of the Revised Code; (B) If a registrant or licensee becomes aware that a borrower and
seller have entered into a previous purchase contract for a property at a lower
price within the previous thirty days, the registrant or licensee shall inform
the person licensed or certified under Chapter 4763. of the Revised Code of the
earlier contract and provide a copy of the contract which shall be appended to
any appraisal the registrant or licensee provides to the lender or anticipated
purchaser of the note. (C) Nothing herein shall prevent a registrant, its employees,
agents or licensees from: (1) Requesting in writing
or by electronic transmittal that the person licensed or certified under
Chapter 4763. of the Revised Code who prepared the appraisal report consider
additional appropriate information when acting upon a good faith belief that
the appraisal contains an error or is professionally deficient. Any appraisal
review or revision request cannot be based on the grounds that the valuation is
not high enough to qualify the borrower for the proposed residential mortgage
loan; or (2) Communicating
information to a person licensed or certified under Chapter 4763. of the
Revised Code that is required by state or federal law, or by any applicable
appraisal standards including, without limitation, a copy of a previously
completed appraisal report provided to a person licensed or certified under
Chapter 4763. of the Revised Code for the purpose of an appraisal
review.
Last updated September 3, 2024 at 8:48 AM
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Rule 1301:8-7-26 | Challenge to information maintained in the NMLS.
Effective:
September 1, 2024
(A) For purposes of division (H) of
section 1322.36 of the Revised Code, an individual who has applied for, holds,
or held a mortgage loan originator license may challenge information entered
into the NMLS by the superintendent. Such challenge shall be in writing and
must set forth the specific information being challenged and include supporting
evidence. The grounds for a challenge shall be limited to the accuracy of the
information entered into the NMLS by the superintendent, controlled by the
superintendent, and pertaining to the individual's own license record. An
individual shall not challenge substantive allegations, findings of fact or
conclusions of law in prior orders issued by the superintendent or other
disciplinary actions. Challenges are limited to clerical errors. (B) The superintendent shall review the information
submitted by the individual. If the superintendent determines that the
information entered into the NMLS is incorrect, the superintendent shall enter
the correct information and notify the individual in writing that the
information has been corrected. If the superintendent determines that the
information entered into the NMLS is correct, the superintendent shall notify
the individual in writing of the reasons for this determination and that the
information will not be changed. (C) The determination of the superintendent is final and
not subject to further challenge pursuant to this rule or appeal pursuant to
Chapter 119. of the Revised Code.
Last updated September 3, 2024 at 8:48 AM
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Rule 1301:8-7-31 | Nonprofit organizations exemption.
Effective:
September 1, 2024
(A) In addition to the criteria set forth
in divisions (F)(1) to (F)(6) of section 1322.01 of the Revised Code, a bona
fide nonprofit organization is also required to: (1) Be registered and
maintain current registration status with the charitable law section of the
Ohio attorney general's office; or (2) Possess a valid
letter of exemption from the charitable law section of the Ohio attorney
general's office. (B) An organization seeking a letter of
exemption as a bona fide nonprofit organization pursuant to division (F)(7) of
section 1322.014 of the Revised Code has the burden of establishing entitlement
to the letter of exemption. (C) An organization seeking a letter of
exemption shall be responsible for paying any applicable fees and submitting an
application for a letter of exemption via the NMLS for each office where
residential mortgage loans are originated for Ohio residents, Ohio property, or
from a location physically in Ohio regardless of the location of the borrowers
or property. (D) The application shall include books,
records, and any additional information the superintendent deems necessary to
substantiate that the applicant meets the criteria in division (G)(2)(i) of
section 1322.01 of the Revised Code and paragraph (A) of this rule. The
applicant shall submit documentation that it has complied with the requirements
of 12 C.F.R. 1026.36(f)(3), as in effect on May 1, 2024, for all employees
acting as a mortgage loan originator for Ohio residents, Ohio property, or from
a location physically in Ohio regardless of the location of the borrowers or
property. If the superintendent determines that the nonprofit organization has
met the aforementioned criteria and requirements, the superintendent shall
issue a letter of exemption to the nonprofit organization which shall expire on
the thirty-first day of December and may be renewed on or before that date by
submitting a renewal application via the NMLS and providing all of the
documentation required by this paragraph. (E) The nonprofit organization shall keep
and maintain records of all residential mortgage loan transactions in the same
manner as is required of registrants. (F) In accordance with rule 1301:8-7-13 of the Administrative
Code, the superintendent may examine the books and records of the bona fide
nonprofit organization periodically to determine if it continues to meet all of
the criteria in division (F) of section 1322.01 of the Revised
Code. (G) An employee of a nonprofit organization that holds a
valid letter of exemption is exempt from having to obtain a mortgage loan
originator license only with respect to his or her work duties to the nonprofit
organization and only with respect to residential mortgage loans with terms
that are favorable to the borrower.
Last updated September 3, 2024 at 8:49 AM
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Rule 1301:8-7-32 | Loan processors and underwriters.
Effective:
September 1, 2024
(A) For purposes of division (AA)(2)(h)
of section 1322.01 of the Revised Code, "loan processing or underwriting
company" means an entity that performs only clerical or support duties for
one or more unaffiliated registrants or qualified exempt entities. (B) For purposes of division (AA)(2)(h)
of section 1322.01 of the Revised Code, "employee" means an
individual for whom the loan processing or underwriting company, in addition to
providing a wage or salary, pays social security and unemployment taxes,
provides workers' compensation coverage, and withholds local, state, and
federal income taxes. Nothing herein prohibits a loan processing or
underwriting company from entering into an agreement with a professional
employer organization as that term is defined in division (D) of section
4125.01 of the Revised Code, provided the loan processing or underwriting
company retains all direction and control over its shared employees'
performance of clerical or support duties. (C) A loan processing or underwriting company seeking a letter of
exemption pursuant to division (AA)(2)(h) of section 1322.01 of the Revised
Code shall be responsible for paying any applicable fees and submitting an
application for a letter of exemption via the NMLS for its main office location
before engaging in the activities of a loan processor or underwriter for
residential mortgage loans involving property in this state. (D) The application shall be in a form prescribed by the
superintendent and shall include all of the following: (1) The loan processing
or underwriting company's business name and state of incorporation or
business registration; (2) The names of the
owners, officers, members, or partners having control of the loan processing or
underwriting company; (3) The names of all
licensees employed by the the loan processing or underwriting
company; (4) An attestation
stating all of the following: (a) All employees who perform clerical or support duties are
either licensees or perform only clerical or support duties at the direction of
and subject to the supervision and instruction of a licensee employed by the
same loan processing or underwriting company. (b) The licensees assign, authorize, and monitor every loan
processor or underwriter employee's performance of clerical or support
duties. (c) The licensees exercise traditional supervisory
responsibilities, including training, mentoring, and evaluation of every loan
processor or underwriter employee. (d) The loan processing or underwriting company always performs
clerical or support duties for others pursuant to a written
contract. (e) No licensee or employee of the loan processing or
underwriting company is also a licensee or employee of any entity for whom it
performs clerical or support duties. (5) A surety bond for all
licensees which may be issued in the same manner as is permitted for
registrants; (6) An acknowledgment of
understanding that the loan processing or underwriting company is subject to
the regulatory authority of the division of financial institutions;
(7) Any further
reasonable information that the superintendent may require. (E) If the superintendent determines that the loan processing or
underwriting company fully and honestly completed the application process and
otherwise qualifies for exemption, the superintendent shall issue a letter of
exemption which shall expire on the thirty-first day of December and may be
renewed on or before that date by submitting an application that meets the
requirements of paragraph (D) of this rule. (F) The burden of proving the exemption is on the loan processing
or underwriting company. (G) The loan processing or underwriting
company shall keep and maintain records of all residential mortgage loan
transactions for the portion of the transaction it conducts in the same manner
as is required of registrants, as provided in division (B) of section 1322.34
of the Revised Code and rule 1301:8-7-06 of the Administrative
Code. (H) The superintendent may, in accordance
with rule 1301:8-7-13 of the Administrative Code, examine the books and records
of the loan processing or underwriting company as often as the superintendent
deems necessary for the purpose of substantiating the loan processing or
underwriting company's exempt status. (I) An employee of a loan processing or underwriting
company that holds a valid letter of exemption may perform clerical or support
duties from any location provided a licensee of the same loan processing or
underwriting company maintains adequate supervision of the loan
processor's or underwriter's performance, including training,
mentoring, and evaluation of the loan processor or underwriter. (J) An employee of loan processing or underwriting company
that holds a valid letter of exemption is exempt from having to obtain a
mortgage loan originator license only with respect to the clerical or support
duties performed for such loan processing or underwriting company. (K) An employee of a loan processing or underwriting
company shall not also be employed by or associated with any entity for whom
the loan processing or underwriting company performs clerical or support
duties. (L) A loan processing or underwriting company performing
clerical or support duties shall comply with rules promulgated under 15 U.S.C.
1681w and 15 U.S.C. 6801, including 16 C.F.R. Part 313 and 16 C.F.R. Part 682,
as those rules are in effect May 1, 2024.
Last updated September 3, 2024 at 8:49 AM
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Rule 1301:8-7-35 | Mortgage servicing definitions.
Effective:
September 19, 2025
As used in rules 1301:8-7-35 to 1301:8-7-40 of the
Administrative Code: (A) "Confirmed successor in
interest" means a successor in interest once a mortgage servicer has
confirmed the successor in interest's identity and ownership interest in a
property that secures a residential mortgage loan. (B) "Dealer" means the
following: (1) In the case of
property improvement loans, a seller, contractor, or supplier of goods or
services; (2) In the case of a
residential mortgage loan for manufactured housing, one who engages in the
business of the sale at retail of manufactured housing. As used in this
paragraph, "manufactured housing" and "sale at retail" have
the same meanings as in section 4781.01 of the Revised Code. (C) "Dealer loan" means any
arrangement in which a dealer assists the borrower in obtaining a residential
mortgage loan from the funding mortgage lender and then assigns the
dealer's legal interests to the funding mortgage lender and receives the
net proceeds of the loan. (D) "Escrow account" means any
account that a mortgage servicer establishes or controls on behalf of a
borrower to pay taxes, insurance premiums including premiums for flood
insurance, or other charges with respect to a residential mortgage loan,
including charges that the borrower and mortgage servicer have voluntarily
agreed that the mortgage servicer should collect and pay. "Escrow
account" includes any account established for this purpose, including a
trust account, reserve account, impound account, or other similar account.
"Escrow account" includes any arrangement in which a mortgage
servicer adds a portion of the borrower's payments to principal and
subsequently deducts from principal the disbursements for escrow account items.
"Escrow account" does not include any account that is under the
borrower's total control. (E) "Federal lending law," as
used in section 1322.50 of the Revised Code, includes 12 C.F.R. Part 1024
Subpart C and the following provisions of 12 C.F.R. Part 1026 as they apply to
a mortgage servicer, as the regulations are in effect on June 1,
2025: (1) 12 C.F.R.
1026.29(f)(5); (2) 12 C.F.R.
1026.20; (3) 12 C.F.R.
1026.25(c)(1)(ii)(B); (4) 12 C.F.R.
1026.34(a)(9); (5) 12 C.F.R.
1026.35(b)(3); (6) 12 C.F.R.
1026.39; (7) 12 C.F.R.
1026.41. (F) "Qualified written request"
means a written correspondence from a borrower to a mortgage servicer that
includes, or otherwise enables the mortgage servicer to identify, the name and
account of the borrower, and does one of the following: (1) A transfer by devise,
descent, or operation of law on the death of a joint tenant or tenant by the
entirety; (2) A transfer to a
relative resulting from the death of a borrower; (3) A transfer by which
the spouse or children of the borrower become an owner of the
property; (4) A transfer resulting
from a decree of a dissolution of marriage, legal separation agreement, or from
an incidental property settlement agreement, by which the spouse of the
borrower becomes an owner of the property; (5) A transfer into an
inter vivos trust in which the borrower is and remains a beneficiary and which
does not relate to a transfer of rights of occupancy in the
property. (G) "Residential mortgage loan"
does not include an open-end line of credit. (H) "Table funding" means a
settlement at which a residential mortgage loan is funded by a contemporaneous
advance of residential mortgage loan funds and an assignment of the residential
mortgage loan to the person advancing the funds. (I) "Transferee mortgage
servicer" means a mortgage servicer that obtains or will obtain the right
to perform servicing pursuant to an agreement or understanding. (J) "Transferor mortgage
servicer" means a servicer, including a table-funding mortgage broker or
dealer on a first-lien dealer loan, that transfers or will transfer the right
to perform servicing pursuant to an agreement or understanding.
Last updated September 19, 2025 at 7:26 AM
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Rule 1301:8-7-36 | Mortgage servicing transfers.
Effective:
September 19, 2025
(A) During the sixty-day period beginning
on the effective date of transfer of the servicing of any residential mortgage
loan, if the transferor mortgage servicer, rather than the transferee mortgage
servicer that should properly receive payment on the loan, receives payment on
or before the applicable due date, including any grace period allowed under the
mortgage loan instruments, a payment will not be treated as late for any
purpose. (B) Beginning on the effective date of
transfer of the servicing of any mortgage loan, with respect to payments
received incorrectly by the transferor mortgage servicer, rather than the
transferee mortgage servicer that should properly receive the payment on the
loan, the transferor mortgage servicer will promptly do either of the
following: (1) Transfer the payment
to the transferee mortgage servicer for application to a borrower's
residential mortgage loan account; (2) Return the payment to
the person that made the payment and notify such person of the proper recipient
of the payment.
Last updated September 19, 2025 at 7:26 AM
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Rule 1301:8-7-37 | Timely escrow payments and treatment of escrow account balances.
Effective:
September 19, 2025
(A) If the terms of a residential
mortgage loan require the borrower to make payments to the mortgage servicer of
the residential mortgage loan for deposit into an escrow account to pay taxes,
insurance premiums, and other charges for the mortgaged property, the mortgage
servicer will make payments from the escrow account in a timely manner, that
is, on or before the deadline to avoid a penalty, so long as the
borrower's payment is not more than thirty days overdue. (B) Except as provided in paragraph (C)
of this rule, within twenty business days of a borrower's payment of a
residential mortgage loan in full, a mortgage servicer will return to the
borrower any amounts remaining in an escrow account that is within the mortgage
servicer's control. (C) If the borrower agrees, a mortgage
servicer may credit any amounts remaining in an escrow account that is within
the mortgage servicer's control to an escrow account for a new residential
mortgage loan as of the date of the settlement of the new residential mortgage
loan if the new residential mortgage loan is provided to the borrower by a
mortgage lender that meets any of the following criteria: (1) The mortgage lender
was also the lender to whom the prior residential mortgage loan was initially
payable; (2) The mortgage lender
is the owner or assignee of the prior residential mortgage loan; (3) The mortgage lender
uses the same mortgage servicer that serviced the prior residential mortgage
loan to service the new residential mortgage loan.
Last updated September 19, 2025 at 7:27 AM
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Rule 1301:8-7-38 | Error resolution procedures.
Effective:
September 19, 2025
(A) A mortgage servicer will comply with
this rule for any written notice from the borrower that asserts an error and
that includes the name of the borrower, information that enables the mortgage
servicer to identify the borrower's residential mortgage loan account, and
the error the borrower believes has occurred. A notice on a payment coupon or
other payment form supplied by the mortgage servicer need not be treated by the
mortgage servicer as a notice of error. A qualified written request that
asserts an error relating to the servicing of a residential mortgage loan is a
notice of error for purposes of this rule, and a mortgage servicer will comply
with all requirements applicable to a notice of error with respect to such
qualified written request. (B) As used in this rule,
"error" means any of the following: (1) Failure to accept a
payment that conforms to the mortgage servicer's written requirements for
the borrower to follow in making payments; (2) Failure to apply an
accepted payment to principal, interest, escrow, or other charges under the
terms of the residential mortgage loan and applicable law; (3) Failure to credit a
payment to a borrower's mortgage loan account as of the date of receipt in
violation of paragraph (Q) of rule 1301:8-7-16 of the Administrative
Code; (4) Failure to pay taxes,
insurance premiums, or other charges, including charges that the borrower and
mortgage servicer have voluntarily agreed that the mortgage servicer should
collect and pay, in a timely manner as required by paragraph (A) of rule
1301:8-7-37 of the Administrative Code, or to refund an escrow account balance
as required by paragraph (B) of rule 1301:8-7-37 of the Administrative
Code; (5) Imposition of a fee
or charge that the mortgage servicer lacks a reasonable basis to impose upon
the borrower; (6) Failure to provide an
accurate payoff balance amount not more than seven business days following a
borrower's request, or, if unable to do so within seven business days
because a residential mortgage loan is in bankruptcy or foreclosure, because
the residential mortgage loan is a reverse mortgage, or because of natural
disasters or other similar circumstances, then within a reasonable
time; (7) Failure to transfer
accurately and timely information relating to the servicing of a
borrower's residential mortgage loan account to a transferee mortgage
servicer; (8) Any other error
relating to the servicing of a borrower's residential mortgage
loan. (C) A mortgage servicer may, by written
notice provided to a borrower, establish an address that a borrower must use to
submit a notice of error in accordance with the procedures in this rule. The
notice will include a statement that the borrower must use the established
address to assert an error. If a mortgage servicer designates a specific
address for receiving notices of error, the mortgage servicer will designate
the same address for receiving information requests pursuant to paragraph (B)
of rule 1301:8-7-39 of the Administrative Code. A mortgage servicer will
provide a written notice to a borrower before any change in the address used
for receiving a notice of error. A mortgage servicer that designates an address
for receipt of notices of error will post the designated address on any web
site maintained by the mortgage servicer if the web site lists any contact
address for the mortgage servicer. (D) Within five business days of a
mortgage servicer receiving a notice of error from a borrower, the mortgage
servicer will provide to the borrower a written response acknowledging receipt
of the notice of error. (E) (1) (a) Except as provided in paragraphs (F) and (G) of this
rule, a mortgage servicer will respond to a notice of error by doing either of
the following: (i) Correcting the errors
identified by the borrower and providing the borrower with a written
notification of the correction, the effective date of the correction, and
contact information, including a telephone number, for further
assistance; (ii) Conducting a
reasonable investigation and providing the borrower with a written notification
that includes a statement that the mortgage servicer has determined that no
error occurred, a statement of the reason or reasons for this determination, a
statement of the borrower's right to request documents relied upon by the
mortgage servicer in reaching its determination, information regarding how the
borrower can request such documents, and contact information, including a
telephone number, for further assistance. (b) If during a reasonable investigation of a notice of
error, a mortgage servicer concludes that errors occurred other than, or in
addition to, the error or errors alleged by the borrower, the mortgage servicer
will correct all such additional errors and provide the borrower with a written
notification that describes the errors the mortgage servicer identified, the
action taken to correct the errors, the effective date of the correction, and
contact information, including a telephone number, for further
assistance. (2) A mortgage servicer
may request supporting documentation from a borrower in connection with the
investigation of an asserted error, but will not do either of the
following: (a) Require a borrower to provide such information as a
condition of investigating an asserted error; (b) Determine that no error occurred because the borrower
failed to provide any requested information without conducting a reasonable
investigation pursuant to paragraph (E)(1)(a)(ii) of this rule. (3) (a) A mortgage servicer will comply with paragraph (E)(1)
of this rule within the following time periods: (i) Not later than seven
business days after the mortgage servicer receives the notice of error for
errors asserted under paragraph (B)(6) of this rule; (ii) For all other
asserted errors, not later than thirty business days after the mortgage
servicer receives the applicable notice of error. (iii) For all other
asserted errors, not later than thirty business days after the mortgage
servicer receives the applicable notice of error. (b) For asserted errors governed by the time limit set
forth in paragraph (E)(3)(a)(ii) of this rule, a mortgage servicer may extend
the time period for responding by an additional fifteen business days if,
before the end of the thirty-day period, the mortgage servicer notifies the
borrower of the extension and the reasons for the extension in writing. A
mortgage servicer will not extend the time period for responding to errors
asserted under paragraph (B)(6) of this rule. (4) A mortgage servicer
will provide to the borrower, at no charge, copies of documents and information
relied upon by the mortgage servicer in making its determination that no error
occurred within fifteen business days of receiving the borrower's request
for such documents. A mortgage servicer is not required to provide documents
relied upon that constitute confidential, proprietary, or privileged
information. If a mortgage servicer withholds documents relied upon because it
has determined that such documents constitute confidential, proprietary, or
privileged information, the mortgage servicer will notify the borrower of its
determination in writing within fifteen business days of receipt of the
borrower's request for such documents. (5) In its response to a
request for documentation under paragraph (E)(4) of this rule, a mortgage
servicer may omit location and contact information and personal financial
information, other than information about the terms, status, and payment
history of the residential mortgage loan, if either of the following
applies: (a) The information pertains to a potential or confirmed
successor in interest who is not the requester; (b) The requester is a confirmed successor in interest and
the information pertains to any borrower who is not the requester. (F) A mortgage servicer is not required
to comply with paragraphs (D) and (E) of this rule if the mortgage servicer
corrects all errors asserted by the borrower and notifies the borrower of that
correction in writing within five business days of receiving the notice of
error. (G) (1) A mortgage servicer
is not required to comply with paragraph (D), (E), or (I) of this rule if the
mortgage servicer reasonably determines that any of the following
apply: (a) The asserted error is substantially the same as an
error previously asserted by the borrower for which the mortgage servicer has
previously complied with its obligation to respond pursuant to paragraphs (D)
and (E) of this rule, unless the borrower provides new and material information
to support the asserted error. As used in this paragraph, "new and
material information" means information that was not reviewed by the
mortgage servicer in connection with investigating a prior notice of the same
error and is reasonably likely to change the mortgage servicer's prior
determination about the error. (b) The notice of error is overbroad. A notice of error is
overbroad if the mortgage servicer cannot reasonably determine from the notice
of error the specific error that the borrower asserts has occurred on a
borrower's account. To the extent a mortgage servicer can reasonably
identify a valid assertion of an error in a notice of error that is otherwise
overbroad, the mortgage servicer will comply with paragraphs (D), (E) and (I)
of this rule with respect to that asserted error. (c) A notice of error is delivered to the mortgage servicer
more than one year after either of the following events: (i) Servicing for the
residential mortgage loan that is the subject of the asserted error was
transferred from the mortgage servicer receiving the notice of error to a
transferee mortgage servicer; (ii) The residential
mortgage loan is discharged. (2) If a mortgage
servicer determines that, pursuant to this paragraph (G), the mortgage servicer
is not required to comply with paragraphs (D), (E), and (I) of this rule, the
mortgage servicer will notify the borrower of its determination in writing not
later than five business days after making such determination. The notice to
the borrower will set forth the basis under paragraph (G)(1) of this rule upon
which the mortgage servicer has made such determination. (H) A mortgage servicer will not charge a
fee, or require a borrower to make any payment that may be owed on a
borrower's account, as a condition of responding to a notice of
error. (I) (1) After receipt of a
notice of error, a mortgage servicer will not, for sixty days, furnish adverse
information to any consumer reporting agency regarding any payment that is the
subject of the notice of error. (2) Nothing in this rule
limits or restricts a mortgage lender or mortgage servicer from pursuing any
remedy it has under applicable law, including initiating foreclosure or
proceeding with a foreclosure sale.
Last updated September 19, 2025 at 7:27 AM
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Rule 1301:8-7-39 | Requests for information.
Effective:
September 19, 2025
(A) A mortgage servicer will comply with
this rule for any written request for information from a borrower that includes
the name of the borrower, information that enables the mortgage servicer to
identify the borrower's residential mortgage loan account, and states the
information the borrower is requesting with respect to the borrower's
residential mortgage loan. A request on a payment coupon or other payment form
supplied by the mortgage servicer need not be treated by the mortgage servicer
as a request for information. A request for a payoff balance need not be
treated by the mortgage servicer as a request for information. A qualified
written request that requests information relating to the servicing of the
mortgage loan is a request for information for purposes of this rule, and a
mortgage servicer will comply with all requirements applicable to a request for
information with respect to such qualified written request. (B) A mortgage servicer may, by written
notice provided to a borrower, establish an address that a borrower must use to
request information in accordance with the procedures in this section. The
notice will include a statement that the borrower must use the established
address to request information. If a mortgage servicer designates a specific
address for receiving information requests, a mortgage servicer will designate
the same address for receiving notices of error pursuant to paragraph (C) of
rule 1301:8-7-38 of the Administrative Code. A mortgage servicer will provide a
written notice to a borrower before any change in the address used for
receiving an information request. A mortgage servicer that designates an
address for receipt of information requests will post the designated address on
any web site maintained by the mortgage servicer if the web site lists any
contact address for the mortgage servicer. (C) Within five business days of a
mortgage servicer receiving an information request from a borrower, the
mortgage servicer will provide to the borrower a written response acknowledging
receipt of the information request. (D) (1) Except as provided in
paragraphs (E) and (F) of this rule, a mortgage servicer will respond to an
information request by doing one of the following: (a) Providing the borrower with the requested information
and contact information, including a telephone number, for further assistance
in writing; (b) Conducting a reasonable search for the requested
information and providing the borrower with a written notification that states
that the mortgage servicer has determined that the requested information is not
available to the mortgage servicer, provides the basis for the mortgage
servicer's determination, and provides contact information, including a
telephone number, for further assistance. (2) (a) A mortgage servicer will comply with paragraph (D)(1)
of this rule within the following time periods: (i) Not later than ten
business days after the mortgage servicer receives an information request for
the identity of, and address or other relevant contact information for, the
owner or assignee of a residential mortgage loan; (ii) For all other
requests for information, not later than thirty business days after the
mortgage servicer receives the information request. (b) For requests for information governed by the time limit
set forth in paragraph (D)(2)(a)(ii) of this rule, a mortgage servicer may
extend the time period for responding by an additional fifteen business days
if, before the end of the thirty-day period, the mortgage servicer notifies the
borrower of the extension and the reasons for the extension in writing. A
mortgage servicer may not extend the time period for requests for information
governed by paragraph (D)(2)(a)(i) of this rule. (3) In its response to a
request for information, a mortgage servicer may omit location and contact
information and personal financial information, other than information about
the terms, status, and payment history of the mortgage loan, if either of the
following applies: (a) The information pertains to a potential or confirmed
successor in interest who is not the requester; (b) The requester is a confirmed successor and the
information pertains to any borrower who is not the requester. (E) A mortgage servicer is not required
to comply with paragraphs (C) and (D) of this rule if the mortgage servicer
provides the borrower with the information requested and contact information,
including a telephone number, for further assistance in writing within five
business days of receiving an information request. (F) (1) A mortgage servicer
is not required to comply with paragraphs (C) and (D) of this rule if the
mortgage servicer reasonably determines that any of the following
apply: (a) The information requested is substantially the same as
information previously requested by the borrower for which the mortgage
servicer has previously complied with its obligation to respond pursuant to
paragraphs (C) and (D) of this rule; (b) The information requested is confidential, proprietary,
or privileged; (c) The information requested is not directly related to
the borrower's residential mortgage loan account; (d) The information request is overbroad or unduly
burdensome. An information request is overbroad if a borrower requests that the
mortgage servicer provide an unreasonable volume of documents or information to
a borrower. An information request is unduly burdensome if a diligent mortgage
servicer could not respond to the information request without either exceeding
the maximum time limit permitted by paragraph (D)(2) of this rule or incurring
costs or dedicating resources that would be unreasonable in light of the
circumstances. To the extent a mortgage servicer can reasonably identify a
valid information request in a submission that is otherwise overbroad or unduly
burdensome, the mortgage servicer will comply with paragraphs (C) and (D) of
this rule with respect to that requested information. (e) The information request is delivered to a mortgage
servicer more than one year after either of the following: (i) Servicing for the
mortgage loan that is the subject of the information request was transferred
from the mortgage servicer receiving the request for information to a
transferee mortgage servicer; (ii) The residential
mortgage loan is discharged. (2) If a mortgage
servicer determines that, pursuant to paragraph (F)(1) of this rule, the
mortgage servicer is not required to comply with paragraphs (C) and (D) of this
section, the mortgage servicer will notify the borrower of its determination in
writing not later than five business days after making such determination. The
notice to the borrower will set forth the basis under paragraph (F)(1) of this
rule upon which the mortgage servicer has made such determination. (G) A mortgage servicer will not charge a
fee, or require a borrower to make any payment that may be owed on a
borrower's account, as a condition of responding to an information
request. (H) Nothing in this rule prohibits a
mortgage servicer from furnishing adverse information to any consumer reporting
agency or pursuing any of its remedies, including initiating foreclosure or
proceeding with a foreclosure sale, allowed by the underlying residential
mortgage loan instruments, during the time period that response to an
information request notice is outstanding. (I) (1) With respect to any
written request from a person that indicates that the person may be a successor
in interest and that includes the name of the transferor borrower from whom the
person received an ownership interest and information that enables the mortgage
servicer to identify the residential mortgage loan account, a mortgage servicer
will respond by providing the potential successor in interest with a written
description of the documents the mortgage servicer reasonably requires to
confirm the person's identity and ownership interest in the property and
contact information, including a telephone number, for further assistance. With
respect to the written request, a mortgage servicer will treat the potential
successor in interest as a borrower for purposes of the requirements of
paragraphs (C) to (G) of this rule. (2) If a written request
under paragraph (I)(1) of this rule does not provide sufficient information to
enable the mortgage servicer to identify the documents the mortgage servicer
reasonably requires to confirm the person's identity and ownership
interest in the property, the mortgage servicer may provide a response that
includes examples of documents typically accepted to establish identity and
ownership interest in a property; indicates that the person may obtain a more
individualized description of required documents by providing additional
information; specifies what additional information is required to enable the
mortgage servicer to identify the required documents; and provides contact
information, including a telephone number, for further assistance. A mortgage
servicer's response under paragraph (I)(2) of this rule will otherwise
comply with paragraph (I)(1) of this rule. Notwithstanding paragraph (F)(1)(a)
of this rule, if a potential successor in interest subsequently provides orally
or in writing the required information specified by the mortgage servicer
pursuant to paragraph (I)(2) of this rule, the mortgage servicer will treat the
new information, together with the original request, as a new, non-duplicative
request under paragraph (I)(1) of this rule, received as of the date the
required information was received, and will respond accordingly. (3) In responding to a
request under paragraph (I)(1) of this rule prior to confirmation, the mortgage
servicer is not required to provide any information other than the information
specified in paragraphs (I)(1) and (I)(2) of this rule. In responding to a
written request under paragraph (I)(1) of this rule that requests other
information, the mortgage servicer will indicate that the potential successor
in interest may resubmit any request for information once confirmed as a
successor in interest. (4) If a mortgage
servicer has established an address that a borrower must use to request
information pursuant to paragraph (B) of this rule, a mortgage servicer will
comply with the requirements of paragraph (I)(1) of this rule only for requests
received at the established address.
Last updated September 19, 2025 at 7:27 AM
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Rule 1301:8-7-40 | Mortgage servicer obligations upon loss of license.
Effective:
September 19, 2025
The revocation, suspension, or failure to obtain
and maintain a license does not impair or affect a mortgage servicer's
obligations under a preexisting lawful contract with a mortgage lender or
borrower.
Last updated September 19, 2025 at 7:27 AM
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