Florida Flashcards
1
Q
Who oversees all financial institutions in the state of FL?
A
Florida Office of Financial Regulation
2
Q
What is another name for the Florida Office of Financial Regulation?
A
The Office
3
Q
Within the Office, there are 3 divisions. What are they?
A
Division of Consumer Finance, Division of Securities, and Division of Financial Institutions
4
Q
Who is in charge of regulating non-depository institutions?
A
Division of Consumer Finance
5
Q
Who is in charge of regulating state-chartered financial institutions?
A
Division of Financial Institutions
6
Q
Who has rulemaking authority and oversight of The Office?
A
The Financial Services Commission
7
Q
What is another name for the Financial Services Commission?
A
The Commission
8
Q
What individuals compose The Commission
A
The Governor and The Cabinet (Attorney General, Agriculture Commissioner, and CFO) and the Deputy Commissioner
9
Q
Florida state’s licensing laws for the regulation of mortgage professionals are found under what?
A
Chapter 494 of the Florida Statutes
10
Q
Where is the Office of Financial Regulation located in Florida?
A
Tallahassee
11
Q
The Division of Consumer Finance (OFC) has two divisions. What are they?
A
Bureau of Registration and the Bureau of Enforcement
12
Q
What does the Bureau of Registration do?
A
They process licenses
13
Q
What does the Bureau of Enforcement do?
A
They conduct examinations of licenses
14
Q
MU1 Form
A
Uniform Mortgage Lender/Mortgage Broker Form
15
Q
MU2 Form
A
Uniform Mortgage Biographical Statement and Consent Form
16
Q
MU3 Form
A
Uniform Mortgage Branch Office Form
17
Q
MU4 Form
A
Uniform Individual Mortgage License/Registration and Consent Form
18
Q
What rules does the Commission abide by in relation to criminal activity?
A
- Permanent bars for felonies involving fraud, dishonesty, breach of trust, or money laundering
- a 15-year disqualifying period for felonies involving moral turpitude
- a 7-year disqualifying period for all other felonies
- a 5-year disqualifying period for misdemeanors involving fraud, dishonesty, or any other act of moral turpitude
19
Q
When can The Office conduct investigations?
A
Whenever they have reason to believe that violation has or will occur
20
Q
Part 1 of Chapter 494 covers what?
A
General provisions as they apply to mortgage professionals
21
Q
Part 2 of Chapter 494 covers what?
A
Contains FL laws applicable to mortgage brokers and loan originators
22
Q
Part 3 of Chapter 494 covers what?
A
Relates to mortgage lenders
23
Q
Control Person
A
an individual, partnership, corporation, trust, or other organization that posses the power to direct the management or policies of a company, whether through ownership of securities, by contract, or otherwise
24
Q
What Act is the administrative “how to” manual for all administrative tasks handled by The Office?
A
Administrative Procedures Act
25
The Administrative Procedures Act governs how the Office can do what?
create admin rules and the enforcement of those rules
26
Negotiable Instruments
unconditional promise or order to pay a fixed amount of money, with or without interest or other charges described in the promise or order, if it meets certain conditions
27
TILA was created for what purpose?
to ensure the clear, accurate disclosure of information to consumers in advertising and in mortgage lending transactions
28
TILA regulates who?
"Creditors"
29
Define "Creditors"
natural persons who regularly extend consumer credit
30
Define "regularly extends credit"
1. The credit is secured by a dwelling and is extended more than five times in the preceding calendar year
2. The credit is secured by a dwelling and the creditor originates more than one credit extension that is a HCM regulated under HOEPA
3. The credit is secured by a dwelling and the creditor originates one more HCM regulated under HOEPA through a mortgage broker
31
Closed-end Transaction
A creditor disburses all of the funds at closing and demands repayment within a specified period of time
32
What can borrowers not do in a closed-end transaction?
They cannot request an increase in the principal amount of the loan
33
Open-end Loan
Both borrower and creditor anticipate repeat transactions
34
Open-end Transaction
A creditor gives the borrower a limit on the amount of funds that he or she can withdraw
35
With an open-end transaction, what can a borrower do??
1. Has the option of requesting a cash advance in any amount
| 2. May request an increase in the amount of credit available
36
What does HOEPA apply to?
Purchase money mortgages, closed-end home equity loans, open-end credit plans (HELOCs), and refinances that are secured by a consumer's principal dwelling
37
HOEPA does not apply to what?
reverse mortgages, bridge loans for the initial construction of a dwelling, loans originated and directly financed by a housing finance agency, or loans originated under the USDA's Rural Development Section 502 Direct Loan Program
38
High Cost Home Loan
a home loan that exceeds either APR, points and fees, or prepayment penalty thresholds
39
Who needs to be licensed in Florida?
Mortgage lenders, loan processors, mortgage brokers, and loan originators
40
What are some examples of people who are exempt from licensing in Florida?
Registered loan originators, federally controlled entities, timeshare exemption, and real estate brokers
41
What is the minimum requirement of years that must be disclosed under Regulatory Action Disclosures?
Within the last 10 years
42
What is the minimum requirement of years that must be disclosed under Civil Judicial Disclosures?
Within the last 10 years
43
```
Single Crimes...what are the standards for?
Class A
Class B
Class C
Class D
```
Class A: The applicant is not eligible for licensure
Class B: May be eligible for licensure 15 years from trigger date
Class C: May be eligible for licensure 7 years from trigger date
Class D: May be eligible for licensure 5 years from trigger date
44
Multiple Crimes....what are the standards for Class B, C, and D?
An additional period of five years will be added to the existing disqualifying period for a single crime. This will be applied for each additional crime.
45
What are the nonrefundable NMLS processing fees for...
1. Mortgage company apps
2. Mortgage loan originator apps
3. Branch office apps
1. $100
2. $30
3. $20
46
Net Worth Requirements for...
1. An applicant not seeking a servicing endorsement?
2. An applicant seeking a serving endorsement?
1. $63,000
| 2. $250,000
47
Licenses must be renewed when?
December 31
48
What is the grace period for those who are unable to qualify for renewal by December 31?
Two-month window
49
How many hours of continuing education needs to be completed?
8 hours
50
What falls under the 30-day Reporting Requirements?
1. Any conviction of or plea of nolo contendere to:
- a crime or admin violation that involves fraud
- any felony
2. Any change to the info contained on the initial application form or any amendment made
3. Any action in bankruptcy
51
How many days does a person have to file an amendment through the NMLS when in regards to change its name, form of business organization or any other info?
No later than 30 days after the effective date of the change
52
How many days does a person have to file an amendment through the NMLS when regards to any changes made to the control persons listed on the initial application?
30 days prior to the effective date or within two business days after the date the licensee first received notice of the change
53
What fees are included in order to renew a mortgage broker license?
A renewal fee, $100 Guaranty Trust Fund, $100 NMLS processing fee, credit report, and background check fee
54
What is the nonrefundable renewal fee for each branch office license for both mortgage lenders and brokers?
$225
55
How often must Mortgage Call Reports be completed?
Quarterly basis
56
Where should records be maintained?
At the principal place of business designated on the license unless otherwise has authorization from The Office
57
When must records be made available to the Office?
Upon request
58
What form must be used to request that records be maintained somewhere other than the principal location?
MU1 form
59
What is the timeframe that a MU1 form can be submitted for a location change of records?
No later than 30 days prior to the effective date of change
60
If the Office receives notice of the change of place for records, records must be available for review within how many days?
Three business days from the date of a written request from the OFR
61
When must an amendment to Form MU1 be submitted regarding the change of location for books and records?
Within 30 days prior to the effective date
62
When an amendment is made to Form MU1 (change of location for records), how many days does the licensee have to make all records available?
Within three business dates from the date of a written request
63
How long must records be kept?
At least three years after the date of original entry
64
Original Entry
the date the documentation was originated or received
65
What is the penalty for maintaining records in a difference office without written notification to the OFC?
Licensee will receive a "notice of noncompliance"
66
If a licensee continues to violate the rule for maintaining records in an alternate office, what is the penalty?
$500 fine and possible license revocation
67
What is the max fine that maybe imposed on a licensee for each violation?
$25,000
68
What is the administrative fine?
$1,000/day, up to $25,000,
69
the SAFE Act requires states to implement one of three consumer protection options. What are they?
1. Net worth requirements
2. Surety bond requirements
3. Guaranty fund requirements
70
What is both the initial and renewal fee for a Mortgage Guaranty Trust Fund (for a licensee?)
$20
71
What is the Mortgage Guaranty Fund?
Ensures payment to consumers who suffer a financial loss due to fraud or deception on behalf of a mortgage originator
72
What is both the initial and renewal fee for a Mortgage Guaranty Trust Fund (for mortgage brokerage and mortgage lendering businesses)
$100
73
How long does collection to the Mortgage Guaranty Trust Fund last?
Annually until the fund reaches $5 million
74
How much will the compensation be for people who seek money from the trust fund?
They will receive payment equal to the unsatisfied portion of that person's judgment, or $50,000, whichever is less
75
If a licensee has a conflict of interest, the licensee must provide what disclosures to the borrower?
1. The nature of the relationship between the provider of services and the licensee making the referral
2. The estimated charge generally made by such a provider
3. The financial benefit to the licensee as a result of the conflict
4. That alternative sources may be chosen by the borrower
76
Mortgage brokers are required to maintain a file for each transaction. How must they be maintained?
In a central location and in an alphabetical or numerical sequence
77
The files mortgage brokers keep include?
Mortgage broker agreement, copy of signed closing statement (or denial or cancellation note), a copy of the good faith estimate of costs
78
If a mortgage broker issues a written commitment for a loan on behalf of the lender, what must be maintained in files?
a copy of the written commitment issued by the mortgage broker and a copy of the written commitment provided by the lender
79
If a mortgage broker issues to the client a written lock-in for the loan on behalf of the lender, what must be maintained in files?
A copy of the written lock-in issued by the mortgage broker and a copy of the written lock-in provided by the lender
80
Mortgage brokerage businesses and lenders acting in the capacity of a mortgage broker business are required to maintain what?
A journal of mortgage brokerage transactions
81
Where must mortgage brokerage and lending transaction journals be kept?
In the principal office or in each branch office where mortgage brokerage transaction are originated
82
After how many days of not updating a transaction journal will result in disciplinary action?
Seven business days from the date of activity
83
Mortgage lenders are required to maintain what?
Mortgage loan applications
84
How much mortgage loan application files be maintained?
In a central location and in alphabetical or numerical sequence
85
At each branch office, what is required?
Designate a principal loan originator and a branch manager
86
What are the requirements of a principal loan originator?
Must have been licensed as a loan originator for at least one year prior to the designation; must demonstrate that they have been actively engaged in a mortgage broker-related business for at least one year prior to accepting the role of principal loan officer
87
What are the requirements for a branch manager?
Must hold a loan originator license
88
When must a mortgage lender submit a copy of their financial audit report?
Send to the Office within 120 days after the end of the licensee's fiscal year
89
If the licensee changes its fiscal year, how long does the licensee have to file a report?
Within 18 months after the previously submitted report
90
In order to record an instrument concerning real property, what must happen?
Execution must be acknowledged by the party executing it, proved by a subscribing witness to it, or legalized or authenticated by Notary or Notary Public with the appropriate official seal
91
A person may not change the borrower what in excess of the maximum fee?
Fee or broker commission
92
What are the max fees/commissions that may be charged for mortgage loans...?
- On a mortgage loan of $1k or less?
- Loan $1k-$2k?
- Loan $2k - $5k?
- Loan exceeding $5k?
- $250
- $250 on 1st $1k plus $10 for each additional $100
- $350 for 1st $2k plus $10 for each additional $100
- $250 plus 10% of entire loan
93
When must the nonrefundable fee be credited against the amount owed as a result of funding?
If the loan is funded
94
When is a commitment fee refundable?
1. Commitment is contingent upon approval by parties to whom the lender plans to sell the loan
2. The requirements of the loan purchaser are not met due to circumstances beyond the borrower's control
3. The borrower is willing but unable to comply with the requirements of the loan purchaser
95
Until a written confirmation of the agreement (lock-in) is signed by the lender and mailed to the borrower or broker, what right does the borrower have?
They have the right to rescind the lock-in agreement
96
When lock-in fees collected by a lender are not in compliance with the law, what must happen?
The fees must be deposited into an escrow account in a federally-insured financial institution
97
How long must licensees maintain records of advertising?
For a period of two years after the ate of publication
98
What must happen to fees received from a third party?
They must immediately be placed into a segregated account with a financial institution located in the Florida. They must also be recorded on a Mortgage Brokerage Deposit Account Form
99
Under which article does the Florida Administrative Procedure Act have authority?
Article V
100
When must the Office publish a notice of the application in the Florida Administrative Weekly in regards to proceedings for a license?
Within 21 days after receipt
101
Within how many days of the publication of a notice regarding proceeding for a license may a person request a hearing?
Within 21 days after publication
102
If a licensee requests a hearing, what must they do?
They must publish a notice of the hearing in a newspaper of general circulation in the area affected by the application
103
When does the Office have authority to conduct an investigation?
Whenever the office has reason to believe that nay violation of the law has been committed or will be committed
104
What are some of the actions the Office can take against individuals?
Restraining orders, appoint a receiver for the property, assets, and business of the defendant, grant injunctive relief restraining the person from advertising, subpoenas, cease and desist orders
105
If a mortgage lender fails to meet net worth requirements, how long can their license be suspended?
Up to 120 days so they may fulfill the net worth requirements
106
What is the max administrative fine?
$25k
107
What can the disciplinary penalty be?
$5k per violation
108
How much can the administrative fine be per day?
$1k per day
109
If a broker has numerous instance of incomplete files and missing docs, the Office may fine what?
$300
110
How is "numerous instances" defined?
At least three instances and a percentage equal to or greater than 20% of the files examined
111
If a licensee fails to maintain files and documentation so that an audit trail of all mortgage transactions can be provided, what is the penalty?
A fine of $1k and a 6-month suspension of the licensee
112
Failure to keep a transaction journal current by entering transactions within 7 business days of initiation may result in the Office doing what?
Issuing a "notice of noncompliance" for the first offense
113
Any subsequent violations in regards to a transaction journal can result in what?
A fine of $500 and suspension of license
114
Failures to maintain an audit trail of all mortgage transactions subjects a lender to what penalty?
Fined $1k and a 6-month license suspension
115
Failure to provide or maintain a copy of the GFE may result in what?
$250 fine per file, up to $2,500 per administrative complaint
116
Failure to provide a non-institutional investor with proper documentation results in what?
A fine of $250 per file and up to $2,500 fine per administrative complaint....the Office will revoke a license if the licensee is grossly negligent in maintaining the required docs
117
What is the penalty for third degree felonies?
Prison term of up to five years and a fine up to $5,000
| Habitual felony offenders may receive up to ten years in prison
118
What is considered a first degree felony?
When the total value of money and property unlawfully obtained exceeds $50k and there are five or more victims
119
What is the punishment for first degree felonies? Habitual?
Prison term of up to 30 years and a fine of $10k....Habitual may receive a life sentence
120
What Article and Section describes the Homestead Exemption Law?
Article 7, Section 6
121
What does Florida's Constitution say about exemptions?
Provides for an exemption from property taxes which is deducted from a property's assessed value if the owner qualifies
122
What is the total exemption possible in Florida?
$50k
123
With Amendment 1, passed in 2008, what impact did it have on exemptions?
Increased potential exemption amount by an additional $25k
124
How can the additional $25k exemption be available to homeowners?
Based on the assessed value of the home..
If between $50k - $75k, they will receive a portion of the additional $25k
If over $75k, they will receive $25k (total of $50k)
125
Who qualifies for exemptions?
Applicants who timely file by March 1st, possess title to the real property, and are bona fide Florida residents living in the dwelling and making in their permanent home as of January 1st
126
"Permanent Residence"
That place where a person has his or her true, fixed, and permanent home and principal establishment to which he or she has the intention of returning
127
Anyone who knowingly and willfully gives false information in order to unlawfully claim a homestead exemption is guilty of what?
A first degree misdemeanor
128
What are the penalties for unlawfully claiming a homestead exemption?
Imprisonment up to one year, a fine of up to $5k, or both
129
Is Florida a lien state or title state?
Lien Theory State
130
Lien Theory
The deed stays with the borrower and the lender places a lien on the property using a mortgage instrument
131
How are foreclosures handled in a Lien Theory State?
The foreclosure is conducted via judicial methods
132
Who is responsible for publishing a legal ad or publication relating to a foreclosure proceeding?
The lender
133
What ends at the foreclosure sale?
Equitable right of redemption
134
How long is the period after the foreclosure sale that "the court reviews the sale to ensure a fair price has been paid?"
10 days
135
What can be placed against a borrower if the foreclosure sale did not produce sufficient proceeds to cover the lender's investment?
a lien
136
What must occur when loan modification services are provided?
A licensee must first execute a written agreement with the borrower for modification services
137
When can a fee be charged when loan modification services are used?
Only if the loan modification results in a material benefit to the borrower
138
When must the loan modification agreement be given to the borrower for review?
At least one business day before the borrower is to sign it
139
How many days does the borrower have, without penalty, to cancel the loan modification agreement?
Within three business days of signing
140
When a borrower signs a loan modification agreement, how long does the licensee have to provide a copy to the borrower?
Within three hours
141
If a licensee is in violation of the law as it pertains to loan modification, the borrower may recover what?
Actual damages, attorney's fees, and court costs
