Wednesday, November 21, 2007 - IS YOUR ENTITY LICENSED IN TX? IF NOT YOU ARE GUILTY OF UNLICENSED ACTIVITY!

IS YOUR ENTITY LICENSED IN TEXAS?

IF NOT YOU WILL BE GUILTY OF UNLICENSED ACTIVITY!

A message from Harry Dinham, NAMB Past President

While at the Mortgage Broker Advisory Committee last week comments and concerns were raised about the lack of applications for the entity license. I believe the number that the commissioner mentioned was 140. Every licensed mortgage broker who doesn't operate as schedule C under their personal tax returns must obtain an entity license.

There are more than 5,000 brokers licensed in the state and only 140 have submitted applications for entity licenses. This application must be submitted prior to January 1, 2008 when these changes take effect. Below you will find the SML department's language from their website. Please don't delay too long because if you continue to operate under a company name without the entity being licensed after January 1, it will be considered unlicensed activity.

If a broker operates with a company name, those companies now have to be licensed. No one (mortgage broker or loan officer) can be individually licensed without their companies licensed (if they have one). In order for the company entity to become licensed, the entity must designate an individual licensed as a mortgage broker as its designated representative and pay an application fee in an amount not to exceed $175. That designated representative must the sole proprietor if the company is a sole proprietorship, be an officer of the corporation if it is a corporation, a manager of the limited liability company if it is a limited liability company, or if the company is a limited partnership the designated representative must be a general partner, an officer of a general partner that is a corporation, or a manager of a general partner that is a limited liability company.

Not later than the 10th day before a mortgage broker begins doing business under an assumed name, the broker shall file with the Commissioner a copy of an assumed name certificate for each assumed name under which the mortgage broker intends to conduct business and pay a $25 registration fee for each assumed name. A loan officer may not conduct business under any assumed name that is not the registered assumed name of the sponsoring broker.

Licensees must notify the Commissioner not later than the 10th day after the date of any change of the person's name and pay a fee of $25 for the name change and issuance of an amended license certificate.

A business entity licensed under this chapter shall notify the Commissioner of any change of its designated representative and pay $25.00 for each change.

Harry H Dinham, CMC

Monday, November 19, 2007 - URGENT INFO ABOUT TX CASHOUT LAWS - Effective Dec 4

As you may know, Constitutional Amendment HJR 72, which amends the Texas home equity provisions in Article 16, Section 50 of the Texas Constitution, approved by the voters on November 6, 2007, will take effect on December 4, 2007 (the date of the official vote canvass by the governor confirming statewide majority approval).

1. The revised 12-day notice cannot be used for TX home equity loans closing prior to December 4, 2007.

2. For Texas home equity loans that will close on and after December 4, 2007, and for which the pre-December 4, 2007 12-day notice was provided prior to December 4, 2007, we recommend that the revised 12-day notice required by HJR 72 be given to the owner of the homestead on or after December 4, 2007, and that the loan not close until a new 12-day notice period has expired.

Yes, that means that if you don't close and fund your loan by Dec 3^rd, you will need to re-disclose on Dec 4^th and wait another 12 days. So the loan cannot close until the 15^th, which is a Saturday meaning, you can't close really until Monday the 17^th. WATCH YOUR LOCKS!!!!

PRE-CLOSING - The updated laws go on to say that along with that required final version of the HUD 1 day prior to closing, you must also provide a final loan application (1003)

POST-CLOSING - The law also was amended to say that a borrower must receive a copy of the SIGNED final loan application and all executed documents SIGNED by the owner at closing related to the loan.