Bill Summary for Bill Number HB09-1085

Date: 01/28/2009

Final
BILL SUMMARY for HB09-1085

HOUSE COMMITTEE ON BUSINESS AFFAIRS AND LABOR

Votes: View-->	Action Taken:
Moved amendment L.001 (Attachment J). The motion Moved to refer House Bill 09-1085, as amended, to	Pass Without Objection PASS

04:16 PM -- House Bill 09-1085

Rep Rice, prime sponsor, presented House Bill 09-1085 concerning the regulation of mortgage loan originators, and, in connection therewith, modifying the "Mortgage Broker Licensing Act" to conform to the federal "Secure and Fair Enforcement for Mortgage Licensing Act of 2008" and exempting certain financial institutions from the list of prohibited practices under the act.

This bill modifies and renames the Mortgage Broker Licensing Act. Mortgage brokers offer or negotiate the terms of a residential home loan. They are regulated by the Division of Real Estate in the Department of Regulatory Agencies (DORA).

The bill defines the term "mortgage loan originator" and replaces the term "mortgage broker" in the text and title of the law. On or after July 31, 2010, mortgage loan originators must be registered with the Nationwide Mortgage Licensing System and Registry, a national tracking system established by the federal Secure and Fair Enforcement for Mortgage Licensing Act of 2008. Registry in the national system is a condition of receiving a license from the department. Nationally registered loan originators will obtain a unique identifying number that must appear on all marketing materials and loan documents.

In addition, the bill:

requires annual renewal of licenses, a change from the current 3 year renewal cycle;
increases education requirements for license renewal from 9 hours every 3 years to 8 hours annually;
requires license applicants to provide additional information to the department including personal credit reports and evidence of financial responsibility;
authorizes the department to obtain additional criminal background information; and
allows the department to order that a mortgage loan originator pay for damages to consumers.

The bill is repealed on July 1, 2011, and requires a sunset review.

04:30 PM

Erin Toll, Director of the Colorado Division of Real Estate, testified in support of the bill. She talked about the bill and explained amendment L.001.

04:32 PM -- Terry Jones, President of the Colorado Mortgage Lenders Association (CMLA), testified in support of the bill.

04:35 PM -- Bill Kidwell, representing the Colorado Association of Mortgage Brokers, testified in support of the bill and distributed a handout of his testimony (Attachment I). He suggested some changes to the bill.

04:50 PM -- Peter Minahan, representing the Colorado Services Association, testified in support of the bill. He said mortgage loan originators did not fall under the mortgage broker bill but will now fall under this bill and said they do not have many issues with the bill, and the issues they have, they have discussed with Director Toll. Mr. Minahan said his concern was over the requirement that each originator is required to have a surety bond and would like to allow an employer bond that covers everyone to be sufficient.


BILL:	HB09-1085
TIME:	04:59:17 PM
MOVED:	Rice
MOTION:	Moved amendment L.001 (Attachment J). The motion passed without objection.
SECONDED:	Gagliardi
		VOTE
	Balmer
	Bradford
	Gagliardi
	Liston
	Priola
	Ryden
	Scanlan
	Soper
	Stephens
	Casso
	Rice

Not Final YES: 0 NO: 0 EXC: 0 ABS: 0 FINAL ACTION: Pass Without Objection

05:03 PM

Representative Rice talked about amendment L.002 that would add an appropriation clause that would take out the database required by the federal government, but said he was not going to offer the amendment at this time.


BILL:	HB09-1085
TIME:	05:06:28 PM
MOVED:	Rice
MOTION:	Moved to refer House Bill 09-1085, as amended, to the Committee on Appropriations. The motion passed 11-0.
SECONDED:	Gagliardi
		VOTE
	Balmer	Yes
	Bradford	Yes
	Gagliardi	Yes
	Liston	Yes
	Priola	Yes
	Ryden	Yes
	Scanlan	Yes
	Soper	Yes
	Stephens	Yes
	Casso	Yes
	Rice	Yes

Final YES: 11 NO: 0 EXC: 0 ABS: 0 FINAL ACTION: PASS

05:07 PM

Adjourn.