February 28, 2007, Introduced by Senators RICHARDVILLE, HARDIMAN, HUNTER, CHERRY, GLEASON, STAMAS, ALLEN, THOMAS, OLSHOVE, KUIPERS, McMANUS, CASSIS, VAN WOERKOM, GARCIA and BARCIA and referred to the Committee on Banking and Financial Institutions.
A bill to amend 1981 PA 125, entitled
"The secondary mortgage loan act,"
by amending section 2 (MCL 493.52), as amended by 1997 PA 91.
THE PEOPLE OF THE STATE OF MICHIGAN ENACT:
Sec.
2. (1) Except for a person licensed under the consumer
financial
services act, 1988 PA 161, MCL 487.2051 to 487.2072, a
depository
financial institution, or an exclusive broker, a A
person shall not act as a broker, lender, or servicer without first
obtaining
a license or registration as provided by this act.
(2)
A person is acting as a broker if the person acts as a
broker
in connection with 1 or more secondary mortgage loans.
(3)
A person is acting as a lender if the person registering
under this act, unless 1 or more of the following apply:
(a) The person is solely performing services as an employee of
only 1 broker, lender, or servicer.
(b) The person is licensed under the consumer financial
services act, 1988 PA 161, MCL 487.2051 to 487.2072.
(c)
The person acts as a lender but makes
or negotiates more
than
2 or fewer secondary mortgage
loans in a calendar year.
(d) (4)
A person is acting as a servicer if the The person
acts
as a servicer but services more than
10 or fewer secondary
mortgage loans in a calendar year.
(e) The person is an individual and an employee of a
professional employer organization, as that term is defined in
section 4 of the single business tax act, 1975 PA 228, MCL 208.4,
solely acting as a secondary mortgage loan originator of only 1
broker or lender. The broker or lender shall do all of the
following:
(i) Direct and control the activities of the individual under
this act.
(ii) Be responsible for all activities of the individual and
assume responsibility for the individual’s actions that are covered
by the proof of financial responsibility deposit required under
section 6.
(2) (5)
Within 90 days after the effective date of the
amendatory
act that added this subsection By
October 31, 1997, a
servicer that was exempt from regulation under this act shall
either file with the commissioner an application for a license or
registration under section 3 or discontinue all activities subject
to this act.
(6)
A natural person who is an employee of only 1 licensee or
registrant
is not required to obtain a license or be registered
under
this act.
(3) (7)
Except for a state or nationally chartered bank,
savings bank, or an affiliate of a bank or savings bank, a person
subject to this act shall not include in its name or assumed name
the words "bank", "banker", "banc", "bankcorp", "bancorp", or any
other words or phrases that would imply that the person is a bank,
is engaged in the business of banking, or is affiliated with a bank
or savings bank. It is not a violation of this subsection for a
licensee to use the term "mortgage banker" or "mortgage banking" in
its name or assumed name.
(4) (8)
A person subject to this act whose name or assumed
name on January 1, 1997 contained a word prohibited by subsection
(7)
(3) may continue to use that name or assumed name.