A. Good Faith and Fair Dealing. A licensee has a duty of good faith and fair dealing in communications, transactions, and course of dealings with a borrower in connection with the advertisement, solicitation, making, servicing, purchase, or sale of any mortgage loan, including, but not limited to:
(1) The duty to recommend to a borrower or induce a borrower to enter into only a mortgage loan refinancing that has a net tangible benefit to a borrower, considering all of the circumstances, including the terms of a loan, the cost of a loan, and the borrower's circumstances;
(2) The duty to provide to a borrower who is offered a higher-priced mortgage loan information about the non-higher-priced mortgage loans that the licensee can make available and for which the borrower may qualify; and
(3) The duty when servicing mortgage loans to:
(a) Promptly provide borrowers with an accurate accounting of the debt owed when borrowers request an accounting;
(b) Make borrowers in default aware of loss mitigation options and services offered by the licensee;
(c) Provide trained personnel and telephone facilities sufficient to promptly answer and respond to borrower inquiries regarding their mortgage loans; and
(d) Pursue loss mitigation when possible.
B. Method to Determine Net Tangible Benefit.
(1) When determining whether a refinance of a mortgage loan will provide a net tangible benefit to the borrower, a licensee shall make a reasonable inquiry of the borrower to determine what net tangible benefit, if any, the borrower will receive from a mortgage loan. Net tangible benefits may include, but are not limited to:
(a) Obtaining a lower interest rate;
(b) Obtaining a lower monthly payment, including principal, interest, taxes, and insurance;
(c) Obtaining a shorter amortization schedule;
(d) Changing from an adjustable rate to a fixed rate;
(e) Eliminating a negative amortization feature;
(f) Eliminating a balloon payment feature;
(g) Receiving cash-out from the new loan in an amount greater than all closing costs incurred in connection with the loan;
(h) Avoiding foreclosure;
(i) Eliminating private mortgage insurance; and
(j) Consolidating other existing loans into a new mortgage loan.
(2) A licensee is considered to have conducted a reasonable inquiry of whether a refinance of a mortgage loan provides a net tangible benefit to a borrower if the mortgage lender has the borrower complete and sign a net tangible benefit worksheet on the form prescribed by the Commissioner.