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Substitute House Bill No. 5123

Public Act No. 03-23

AN ACT CONCERNING PAYMENT OF SECONDARY MORTGAGE LOAN PROCEEDS BY WIRE TRANSFER.

Be it enacted by the Senate and House of Representatives in General Assembly convened:

Section 1. Section 36a-758a of the general statutes is repealed and the following is substituted in lieu thereof (Effective October 1, 2003):

(a) Any person or entity engaged in the business of (1) making first mortgage loans in this state and licensed in accordance with [sections 36a-485 to 36a-498, inclusive] part I(A) of chapter 668, or (2) making secondary mortgage loans in the state and licensed in accordance with part I(B) of chapter 668, that chooses to utilize a wire transfer to send the loan proceeds to the mortgagee's attorney, shall transfer the loan proceeds to the bank which holds the account of the mortgagee's attorney by a wire transfer in a timely manner, but in any event not later than the scheduled date and time of the closing of the loan, except that in the case of a mortgage refinancing where any right of rescission under 12 CFR 226. 23 has terminated, any such wire transfer shall be in a timely manner, but in any event not later than the disbursement date. In the case of a person or entity engaged in the business of making secondary mortgage loans in this state, the provisions of this subsection shall apply only to secondary mortgage loans to finance the acquisition or initial construction of the mortgagor's principal dwelling.

(b) The Commissioner of Banking may suspend, revoke or refuse to renew a license pursuant to section 36a-51 issued to a person or entity engaged in the business of making first mortgage loans or secondary mortgage loans in this state and licensed in accordance with [sections 36a-485 to 36a-498, inclusive] part I(A) or I(B) of chapter 668, that fails to comply with subsection (a) of this section.

Approved May 12, 2003