09.03.06.03

.03 Licensing and Application Requirements.

A. Scope.

(1) If otherwise required to be licensed under Financial Institutions Article, §11-502, Annotated Code of Maryland, a person is not exempt because the person:

(a) Is an out-of-State deposit-taking financial institution;

(b) Does not have offices in Maryland;

(c) Does not have tax situs in Maryland; or

(d) Is not required to register as a foreign corporation doing business in Maryland.

(2) Repealed.

(3) For purposes of Financial Institutions Article, §11-506(b)(1), Annotated Code of Maryland, an individual is considered to have at least 3 years of experience in the mortgage lending business if:

(a) The individual has received compensation in connection with a minimum of 12 closed mortgage loans per year for each of the 3 years; or

(b) The individual has worked in the mortgage lending business at least an average of 20 hours per week for each of the 3 years.

(4) The Commissioner may consider the totality of an individual's particular duties and activities while engaged in the mortgage lending business to determine whether the individual has at least 3 years of experience.

B. Unlicensed Mortgage Lender. A licensee may not broker a loan to, or accept a loan referral from, a person the licensee knows is not licensed by the Commissioner, unless the licensee reasonably and in good faith believes that the person is properly licensed or exempt from the licensing requirement.

C. Renewals.

(1) A licensee may renew a license by filing a completed renewal application before the expiration of its current license.

(2) A person who fails to comply with §C(1) of this regulation shall file an application for a new license with all application and investigation fees, unless the renewal application is filed with the Commissioner within 30 days after the date on which the current license expired.

D. Change of Location. If a licensee changes the location of a licensed office and commences business at the new location without obtaining approval by the Commissioner, an application for a new license shall be filed with all application and investigation fees.

E. Bond Termination.

(1) If a licensee's bond, letter of credit, or trust account is cancelled, expired, or closed and no substitute bond or authorized security is in place:

(a) Upon notice of the termination from the bond surety, or issuer of the letter of credit or trust account, the licensee shall immediately cease doing any business as a mortgage lender; and

(b) The mortgage lender's license is suspended.

(2) If the termination remains in effect for more than 30 days, an application for a new license shall be filed with all application and investigation fees.

F. Loan Processing Under Expired License. If a licensee is operating without a license because of a failure to timely renew, or an unauthorized change in location, the licensee may continue to process and close loans which were applied for before the deadline for renewal or the unauthorized change of location.

G. Posting License. A licensee shall post its license for each licensed location, on the premises in a conspicuous location accessible to the public.

H. Complaint Resolution.

(1) A licensee shall designate an officer, director, or member of senior management as being responsible for, and authorized to make, decisions regarding the resolution of complaints received from the Commissioner.

(2) The name of the person designated under §H(1) of this regulation shall be provided to the Commissioner as part of an application for:

(a) A new license; and

(b) License renewal.

I. Designation of Mortgage-Related Activity.

(1) A licensee shall designate on its original license application and on any license renewal application whether it will act, under its license, as one or more of the following:

(a) A lender;

(b) A mortgage broker; or

(c) A mortgage servicer.

(2) Notification.

(a) A licensee shall notify the Commissioner in writing if, after the issuance or the renewal of its license, it begins conducting a new activity that the licensee did not designate under §I(1) of this regulation.

(b) The licensee shall deliver the notification to the Commissioner within 10 business days after beginning the new activity.

J. Transition to Nationwide Mortgage Licensing System and Registry.

(1) Fingerprinting and Criminal Background Checks. Notwithstanding any provision of Financial Institutions Article, Annotated Code of Maryland, in connection with an initial application for a license, and at any other time that the Commissioner requests, an applicant or licensee shall provide fingerprints for use by the Federal Bureau of Investigation and the Criminal Justice Information System Central Repository of the Department of Public Safety and Correctional Services to conduct criminal history record checks until:

(a) The NMLSR is able to accept fingerprints for submission to the Federal Bureau of Investigation and any other governmental agency or entity authorized to receive this information for a state, national, or international criminal history background check; and

(b) The Commissioner has developed and implemented procedures to allow the NMLSR to accept fingerprints for submission to the Federal Bureau of Investigation and any other governmental agency or entity authorized to receive this information for a state, national, or international criminal history background check.

(2) Corporate Office.

(a) A person applying for an initial or a renewal license through the NMLSR shall comply with NMLSR procedures by obtaining a license from the Commissioner for the applicant's corporate office location by filing the NMLSR form MU-1.

(b) A person holding a license for its corporate office subject to the NMLSR form MU-1 may apply to the Commissioner for one or more licenses for additional locations by filing the NMLSR form MU-3.

K. Incomplete Applications. If an application for an initial license, a renewal license, or a license amendment is incomplete when submitted and remains incomplete for at least 60 days, the Commissioner may cease processing the incomplete application and return it to the applicant.