(A)*
NONDEPOSITORY FIRST MORTGAGE LENDERS, BROKERS
AND ORIGINATORS
Sec. 36a-485. (Formerly Sec. 36-440). *(See end of section for amended version
and effective date.) Definitions. As used in this section and sections 36a-486 to 36a-498a, inclusive, unless the context otherwise requires:
(1) "Advance fee" means any consideration paid or given, directly or indirectly, to a
mortgage lender, first mortgage broker or originator required to be licensed or registered
pursuant to sections 36a-485 to 36a-498a, inclusive, prior to the closing of a first mortgage loan to any person, including, but not limited to, loan fees, points, broker's fees
or commissions, transaction fees or similar prepaid finance charges;
(2) "Advertise" or "advertisement" means the use of media, mail, computer, telephone, personal contact or any other means to offer the opportunity for a first mortgage loan;
(3) "First mortgage broker" means a person who, for a fee, commission or other
valuable consideration, directly or indirectly, negotiates, solicits, arranges, places or
finds a first mortgage loan that is to be made by a mortgage lender, whether or not the
mortgage lender is required to be licensed under sections 36a-485 to 36a-498a, inclusive;
(4) "First mortgage correspondent lender" means a person engaged in the business
of making first mortgage loans in such person's own name where the loans are not held
by such person for more than ninety days and are funded by another person through a
warehouse agreement, table funding agreement or similar agreement;
(5) "First mortgage lender" means a person engaged in the business of making first
mortgage loans: (A) In such person's own name utilizing such person's own funds, or
(B) by funding loans through a table funding agreement;
(6) "First mortgage loan" means a loan or an extension of credit, including, but not
limited to, an extension of credit pursuant to a contract or an assigned contract for the
sale of goods or services, made to a natural person, the proceeds of which are to be used
primarily for personal, family or household purposes, and which is secured by a first
mortgage upon any interest in one-to-four-family residential owner-occupied real property located in this state which is not subject to any prior mortgages and includes the
renewal or refinancing of an existing first mortgage loan;
(7) "Mortgage lender" means a first mortgage lender, a first mortgage correspondent
lender, or both;
(8) "Originator" means an individual who is employed or retained by, or otherwise
acts on behalf of, a mortgage lender or first mortgage broker that is licensed or required
to be licensed under sections 36a-485 to 36a-498a, inclusive, for, or with the expectation
of, a fee, commission or other valuable consideration, to take an application for or
negotiate, solicit, arrange or find a first mortgage loan. "Originator" does not include
(1) an officer, if the licensee is a corporation; a general partner, if the licensee is a
partnership; a member, if the licensee is a limited liability company; or a sole proprietor,
if the licensee is a sole proprietorship, or (2) an individual whose responsibilities are
limited to clerical and administrative tasks and who does not solicit borrowers, take
applications or negotiate the terms of loans;
(9) "Residential property" means improved real property used or occupied, or intended to be used or occupied, for residential purposes;
(10) "Simulated check" means a document that imitates or resembles a check but
is not a negotiable instrument;
(11) "Table funding agreement" means an agreement wherein a person agrees to
fund mortgage loans to be made in another person's name and to purchase such loans
after they are made; and
(12) "Warehouse agreement" means an agreement to provide credit to a person to
enable the person to have funds to make mortgage loans and hold such loans pending
sale to other persons.
(P.A. 85-399, S. 1; P.A. 87-9, S. 2, 3; P.A. 89-347, S. 9; P.A. 92-12, S. 87; 92-132, S. 3, 5; P.A. 94-122, S. 229, 340;
P.A. 99-36, S. 23; 99-63, S. 2; P.A. 02-111, S. 2; P.A. 04-69, S. 1; P.A. 07-91, S. 1.)
*Note: On and after September 30, 2008, this section, as amended by section 4 of
public act 07-156, is to read as follows:
"Sec. 36a-485. (Formerly Sec. 36-440). Definitions. As used in this section and
sections 36a-486 to 36a-498a, inclusive, unless the context otherwise requires:
(1) "Advance fee" means any consideration paid or given, directly or indirectly, to
a mortgage lender, first mortgage broker or originator required to be licensed pursuant
to sections 36a-485 to 36a-498a, inclusive, prior to the closing of a first mortgage loan to
any person, including, but not limited to, loan fees, points, broker's fees or commissions,
transaction fees or similar prepaid finance charges;
(2) "Advertise" or "advertisement" means the use of media, mail, computer, telephone, personal contact or any other means to offer the opportunity for a first mortgage loan;
(3) "First mortgage broker" means a person who, for a fee, commission or other
valuable consideration, directly or indirectly, negotiates, solicits, arranges, places or
finds a first mortgage loan that is to be made by a mortgage lender, whether or not the
mortgage lender is required to be licensed under sections 36a-485 to 36a-498a, inclusive;
(4) "First mortgage correspondent lender" means a person engaged in the business
of making first mortgage loans in such person's own name where the loans are not held
by such person for more than ninety days and are funded by another person through a
warehouse agreement, table funding agreement or similar agreement;
(5) "First mortgage lender" means a person engaged in the business of making first
mortgage loans: (A) In such person's own name utilizing such person's own funds, or
(B) by funding loans through a table funding agreement;
(6) "First mortgage loan" means a loan or an extension of credit, including, but not
limited to, an extension of credit pursuant to a contract or an assigned contract for the
sale of goods or services, made to a natural person, the proceeds of which are to be used
primarily for personal, family or household purposes, and which is secured by a first
mortgage upon any interest in one-to-four-family residential owner-occupied real property located in this state which is not subject to any prior mortgages and includes the
renewal or refinancing of an existing first mortgage loan;
(7) "Mortgage lender" means a first mortgage lender, a first mortgage correspondent
lender, or both;
(8) "Originator" means an individual who is employed or retained by, or otherwise
acts on behalf of, a mortgage lender or first mortgage broker that is licensed or required
to be licensed under sections 36a-485 to 36a-498a, inclusive, for, or with the expectation
of, a fee, commission or other valuable consideration, to take an application for or
negotiate, solicit, arrange or find a first mortgage loan. "Originator" does not include
(1) an officer, if the mortgage lender or first mortgage broker licensee is a corporation;
a general partner, if the licensee is a partnership; a member, if the licensee is a limited
liability company; or a sole proprietor, if the licensee is a sole proprietorship, or (2) an
individual whose responsibilities are limited to clerical and administrative tasks and
who does not solicit borrowers, take applications or negotiate the terms of loans;
(9) "Residential property" means improved real property used or occupied, or intended to be used or occupied, for residential purposes;
(10) "Simulated check" means a document that imitates or resembles a check but
is not a negotiable instrument;
(11) "Table funding agreement" means an agreement wherein a person agrees to
fund mortgage loans to be made in another person's name and to purchase such loans
after they are made; and
(12) "Warehouse agreement" means an agreement to provide credit to a person to
enable the person to have funds to make mortgage loans and hold such loans pending
sale to other persons."
(P.A. 85-399, S. 1; P.A. 87-9, S. 2, 3; P.A. 89-347, S. 9; P.A. 92-12, S. 87; 92-132, S. 3, 5; P.A. 94-122, S. 229, 340;
P.A. 99-36, S. 23; 99-63, S. 2; P.A. 02-111, S. 2; P.A. 04-69, S. 1; P.A. 07-91, S. 1; 07-156, S. 4.)
History: (Revisor's note: Pursuant to P.A. 87-9 "banking commissioner" was changed editorially by the Revisors to
"commissioner of banking"); P.A. 89-347 added Subsec. (g) defining "mortgage broker"; P.A. 92-12 redesignated Subdivs.
and made technical changes; P.A. 92-132 added Subdiv. (8) defining "advance fee"; P.A. 94-122 deleted definitions of
"commissioner" and "person", alphabetized remaining definitions and made technical changes, effective January 1, 1995;
Sec. 36-440 transferred to Sec. 36a-485 in 1995; P.A. 99-36 made a technical change; P.A. 99-63 amended Subdiv. (2) to
redefine "first mortgage loan", added new Subdivs. (7) and (8) defining "simulated check" and "advertise" or "advertisement", and made technical changes; P.A. 02-111 redefined "advance fee" and "mortgage lender", deleted definitions of
"mortgage broker" and "principal officer" and added definitions of "first mortgage broker", "first mortgage correspondent
lender", "first mortgage lender", "originator", "table funding agreement" and "warehouse agreement", renumbering Subdivs. accordingly; P.A. 04-69 substituted "36a-498a" for "36a-498" throughout; P.A. 07-91 redefined "originator" in
Subdiv. (8); P.A. 07-156 redefined "advance fee" in Subdiv. (1) to delete "or registered", and redefined "originator" in
Subdiv. (8) to insert "mortgage lender or first mortgage broker" re exclusion for officer, effective September 30, 2008.
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Sec. 36a-486. (Formerly Sec. 36-440a). *(See end of section for amended version and effective date.) License required. Registration of originator. Violations.
(a) No person shall engage in the business of making first mortgage loans or act as a
first mortgage broker in this state unless such person has first obtained the required
license in accordance with the provisions of sections 36a-485 to 36a-498a, inclusive.
A first mortgage correspondent lender shall not be deemed to be acting as a first mortgage
lender if such first mortgage correspondent lender makes a loan utilizing its own funds
in a situation where another person does not honor such person's commitment to fund
the loan.
(b) No licensee shall employ or retain an originator without first registering such
originator under sections 36a-485 to 36a-498a, inclusive, provided such registration
shall not be required for any originator who is registered by such licensee under sections
36a-510 to 36a-524, inclusive. No individual may act as an originator without being
registered, or act as an originator, as defined in sections 36a-485 and 36a-510, for more
than one person. The registration of an originator is not effective during any period when
such originator is not associated with a licensee. Both the originator and the licensee shall
promptly notify the commissioner, in writing, of the termination of employment or
services of an originator.
(c) Each first mortgage loan negotiated, solicited, placed, found or made without a
license or registration shall constitute a separate violation for purposes of section 36a-50.
(P.A. 85-399, S. 2; P.A. 89-347, S. 10; P.A. 93-32; P.A. 94-122, S. 230, 340; P.A. 96-71, S. 1, 8; 96-109, S. 10; 96-180, S. 117, 166; P.A. 02-111, S. 3; P.A. 04-69, S. 2.)
*Note: On and after September 30, 2008, this section, as amended by section 5 of
public act 07-156, is to read as follows:
"Sec. 36a-486. (Formerly Sec. 36-440a). License required. Violations. (a) No
person shall engage in the business of making first mortgage loans or act as a first
mortgage broker in this state unless such person has first obtained the required license
in accordance with the provisions of sections 36a-485 to 36a-498a, inclusive. A first
mortgage correspondent lender shall not be deemed to be acting as a first mortgage
lender if such first mortgage correspondent lender makes a loan utilizing its own funds
in a situation where another person does not honor such person's commitment to fund
the loan.
(b) No person licensed as a mortgage lender or first mortgage broker shall employ
or retain an originator unless such originator is licensed under sections 36a-485 to 36a-498a, inclusive, provided such licensure shall not be required for any originator who is
licensed under sections 36a-510 to 36a-524, inclusive. No individual may act as an
originator without being licensed, or act as an originator, as defined in sections 36a-485
and 36a-510, for more than one person. The license of an originator is not effective
during any period when such originator is not associated with a licensed mortgage lender
or first mortgage broker. Both the originator and the mortgage lender and first mortgage
broker shall promptly notify the commissioner, in writing, of the termination of employment or services of an originator.
(c) Each first mortgage loan negotiated, solicited, placed, found or made without a
license shall constitute a separate violation for purposes of section 36a-50."
(P.A. 85-399, S. 2; P.A. 89-347, S. 10; P.A. 93-32; P.A. 94-122, S. 230, 340; P.A. 96-71, S. 1, 8; 96-109, S. 10; 96-180, S. 117, 166; P.A. 02-111, S. 3; P.A. 04-69, S. 2; P.A. 07-156, S. 5.)
History: P.A. 89-347 added requirements re mortgage brokers; P.A. 93-32 made previous provision Subsec. (a) and
added new Subsec. (b) imposing civil penalty for those who do not obtain the license required; P.A. 94-122 made technical
changes, effective January 1, 1995; Sec. 36-440a transferred to Sec. 36a-486 in 1995; P.A. 96-71, 96-109 and 96-180 all
amended Subsec. (a) to delete "loan" before "mortgage loan business in this state", effective July 1, 1996; P.A. 02-111
amended Subsec. (a) by rewriting provisions applicable to lenders and brokers and adding provisions re first mortgage
correspondent lenders, added new Subsec. (b) re registration of originators, and redesignated existing Subsec. (b) as Subsec.
(c), adding "or registration" therein; P.A. 04-69 amended Subsecs. (a) and (b) to substitute "36a-498a" for "36a-498"; P.A.
07-156 amended Subsecs. (b) and (c) to replace registration requirement for originators with licensing requirement and to
make conforming changes, effective September 30, 2008.
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Sec. 36a-488. (Formerly Sec. 36-440c). *(See end of section for amended version and effective date.) License as first mortgage lender, first mortgage correspondent lender or first mortgage broker. Prerequisites. Application for license or registration. (a)(1) The commissioner shall not issue a license as a first mortgage lender, a
first mortgage correspondent lender or a first mortgage broker to any person unless
such person meets the following tangible net worth and experience requirements, as
applicable: (A) The minimum tangible net worth requirement for a first mortgage lender
shall be two hundred fifty thousand dollars and the minimum tangible net worth requirement for a first mortgage correspondent lender and a first mortgage broker shall be
twenty-five thousand dollars, and (B) a mortgage lender shall have, at the location for
which the license is sought, a person with supervisory authority over the lending activities who has at least three years' experience in the mortgage lending business within
the five years immediately preceding the application for the license and a first mortgage
broker shall have, at the location for which the license is sought, a person with supervisory authority over the brokerage activities who has at least three years' experience in
the mortgage lending or mortgage brokerage business within the five years immediately
preceding the application for the license, provided such experience requirements shall
not apply to any person whose license is renewed effective October 1, 2002.
(2) Each licensee shall maintain the net worth required by this subsection and shall
promptly notify the commissioner if such licensee's net worth falls below the net worth
required by this subsection.
(b) The commissioner may issue a first mortgage lender license, a first mortgage
correspondent lender license, or a first mortgage broker license. Each first mortgage
lender licensee may also act as a first mortgage correspondent lender and a first mortgage
broker, and each first mortgage correspondent lender licensee may also act as a first
mortgage broker. An application for a license or renewal of such license shall be made
under oath and on a form provided by the commissioner. The application shall include:
(1) The type of license sought; (2) the name and address of the applicant; (3) the location
for which the license is sought; (4) the name and address of each member, partner,
officer, director, authorized agent and shareholder owning ten per cent or more of the
outstanding stock, as applicable; (5) if the applicant is a trust or the lead lender in one
or more participation loans, the name and address of each trustee or lead lender and
each beneficiary of the trust or other participant lenders in all outstanding participation
loans; (6) a financial statement as of a date not more than six months prior to the filing
of the application which reflects tangible net worth, and if such financial statement is
unaudited, the proprietor, general partner, or duly authorized officer, trustee or member
shall swear to its accuracy under oath before a notary public; (7) evidence that the person
with supervisory authority over the lending or brokerage activities at the location for
which the license is sought meets the experience required by subsection (a) of this
section; (8) an application for registration of each originator or prospective originator
of the applicant at such location; and (9) such other information pertaining to the applicant, the applicant's background, the background of its principals and employees, and
the applicant's activities as the commissioner may require.
(c) An application for registration of an originator or renewal of such registration
shall be made on a form provided by the commissioner.
(d) It shall be considered a violation of section 36a-53a if a licensee files an application for registration of an originator or for renewal of such registration with knowledge
that such application contains a material misstatement by an originator.
(P.A. 85-399, S. 4; P.A. 89-347, S. 11; P.A. 94-122, S. 232, 340; P.A. 99-36, S. 25; P.A. 02-111, S. 5; P.A. 06-45, S.
1; P.A. 07-91, S. 2.)
*Note: On and after September 30, 2008, this section, as amended by section 2 of
public act 07-91 and section 6 of public act 07-156, is to read as follows:
"Sec. 36a-488. (Formerly Sec. 36-440c). License as first mortgage lender, first
mortgage correspondent lender or first mortgage broker. Prerequisites. Application for license. (a)(1) The commissioner shall not issue a license as a first mortgage
lender, a first mortgage correspondent lender or a first mortgage broker to any person
unless such person meets the following tangible net worth and experience requirements,
as applicable: (A) The minimum tangible net worth requirement for a first mortgage
lender shall be two hundred fifty thousand dollars and the minimum tangible net worth
requirement for a first mortgage correspondent lender and a first mortgage broker shall
be twenty-five thousand dollars, and (B) a mortgage lender shall have, at the location
for which the license is sought, a person with supervisory authority over the lending
activities who has at least three years' experience in the mortgage lending business
within the five years immediately preceding the application for the license and a first
mortgage broker shall have, at the location for which the license is sought, a person
with supervisory authority over the brokerage activities who has at least three years'
experience in the mortgage lending or mortgage brokerage business within the five years
immediately preceding the application for the license.
(2) Each licensee shall maintain the net worth required by this subsection and shall
promptly notify the commissioner if such licensee's net worth falls below the net worth
required by this subsection.
(b) The commissioner may issue a first mortgage lender license, a first mortgage
correspondent lender license, or a first mortgage broker license. Each first mortgage
lender licensee may also act as a first mortgage correspondent lender and a first mortgage
broker, and each first mortgage correspondent lender licensee may also act as a first
mortgage broker. An application for a license or renewal of such license shall be made
under oath and on a form provided by the commissioner. The application shall include:
(1) The type of license sought; (2) the name and address of the applicant; (3) the location
for which the license is sought; (4) the name and address of each member, partner,
officer, director, authorized agent and shareholder owning ten per cent or more of the
outstanding stock, as applicable; (5) if the applicant is a trust or the lead lender in one
or more participation loans, the name and address of each trustee or lead lender and
each beneficiary of the trust or other participant lenders in all outstanding participation
loans; (6) a financial statement as of a date not more than six months prior to the filing
of the application which reflects tangible net worth, and if such financial statement is
unaudited, the proprietor, general partner, or duly authorized officer, trustee or member
shall swear to its accuracy under oath before a notary public; (7) evidence that the person
with supervisory authority over the lending or brokerage activities at the location for
which the license is sought meets the experience required by subsection (a) of this
section; and (8) such other information pertaining to the applicant, the applicant's background, the background of its principals and employees, and the applicant's activities
as the commissioner may require. The commissioner may conduct a criminal history
records check of the applicant, of each member, partner, officer or director of the applicant and of the person with supervisory authority at the location for which the license
is sought, and require the applicant to submit the fingerprints of such persons as part of
the application. The application shall be filed with the national mortgage licensing system, which shall process the fingerprints through the Federal Bureau of Investigation.
(c) An application for an originator license or renewal of such license shall be made
on a form provided by the commissioner. The commissioner may conduct a criminal
history records check of the applicant and require the applicant to submit fingerprints
as part of the application. The application shall be filed with the national mortgage
licensing system, which shall process the fingerprints through the Federal Bureau of
Investigation."
(P.A. 85-399, S. 4; P.A. 89-347, S. 11; P.A. 94-122, S. 232, 340; P.A. 99-36, S. 25; P.A. 02-111, S. 5; P.A. 06-45, S.
1; P.A. 07-91, S. 2; 07-156, S. 6.)
History: P.A. 89-347 amended Subsec. (b) by inserting new Subdiv. (4) re the applicant's status as a lender or a broker
and renumbered the remaining Subdiv.; P.A. 94-122 made technical changes, effective January 1, 1995; Sec. 36-440c
transferred to Sec. 36a-488 in 1995; P.A. 99-36 made a technical change in Subsec. (a); P.A. 02-111 replaced former
Subsec. (a) with new provisions re obtaining license as first mortgage lender, first mortgage correspondent lender or first
mortgage broker and re obligation to notify commissioner if net worth falls below requisite net worth, amended Subsec.
(b) to reflect commissioner's authority to issue first mortgage lender license, first mortgage correspondent lender license
and first mortgage broker license and to revise application requirements and added new Subsec. (c) re application for
registration of originator; P.A. 06-45 added Subsec. (d) to provide that filing application for registration of originator with
knowledge that application contains a material misstatement by originator shall be a violation of Sec. 36a-53a, effective
May 8, 2006; P.A. 07-91 amended Subsec. (d) to provide that filing application for renewal of registration of originator
with knowledge that application contains a material misstatement by originator shall be a violation of Sec. 36a-53a; P.A.
07-156 amended Subsec. (a)(1) to delete proviso re inapplicability of experience requirements to any person whose license
is renewed effective October 1, 2002, amended Subsec. (b) to authorize commissioner to conduct a criminal history records
check of applicants and key persons of such applicants, to require applicants to submit fingerprints of such persons, and
to require filing of applications with the national mortgage licensing system, amended Subsec. (c) to authorize commissioner
to conduct criminal history records check of applicant for an originator license, to require applicant to submit fingerprints
as part of application, and to require filing application with such system, and deleted former Subsec. (d) and language in
Subsecs. (b)(8) and (c) re registration of originator and substituted language re originator license in Subsec. (c), effective
September 30, 2008.
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Sec. 36a-489. (Formerly Sec. 36-440d). *(See end of section for amended version and effective date.) Application for license or registration. Denial of application for license or registration. (a) If the commissioner finds, upon the filing of an
application for a license, that the applicant meets the requirements of subsection (a) of
section 36a-488, and that the financial responsibility, character, reputation, integrity
and general fitness of the applicant and of the partners thereof if the applicant is a
partnership, of the members if the applicant is a limited liability company or association,
and of the officers, directors and principal employees if the applicant is a corporation,
are such as to warrant belief that the business will be operated soundly and efficiently,
in the public interest and consistent with the purposes of sections 36a-485 to 36a-498a,
inclusive, the commissioner may thereupon issue the applicant the license. If the commissioner fails to make such findings, or if the commissioner finds that the applicant
has made a material misstatement in such application or in the application for registration
of an originator, or files an application for registration of an originator with knowledge
that such application contains a material misstatement by an originator, the commissioner shall not issue a license, and shall notify the applicant of the denial and the reasons
for such denial. Any denial of an application by the commissioner shall, when applicable,
be subject to the provisions of section 46a-80.
(b) Upon the filing of an application for registration, the commissioner shall register
the originator named in the application unless the commissioner finds that such originator or the applicant has made a material misstatement in the application or that the
financial responsibility, character, reputation, integrity and general fitness of such originator are not such as to warrant belief that granting such registration would be in the
public interest and consistent with the purposes of sections 36a-485 to 36a-498a, inclusive. If the commissioner denies registration, the commissioner shall notify such originator and the applicant filing the application of the denial and the reasons for such denial.
Any denial of an application by the commissioner shall, when applicable, be subject to
the provisions of section 46a-80. A registration shall remain in force and effect until it
has been surrendered, revoked, suspended or expires in accordance with the provisions
of sections 36a-485 to 36a-498a, inclusive.
(P.A. 85-399, S. 5; P.A. 89-347, S. 12; P.A. 94-122, S. 233, 340; P.A. 99-36, S. 26; P.A. 02-111, S. 6; P.A. 04-69, S.
4; P.A. 06-45, S. 2.)
*Note: On and after September 30, 2008, this section, as amended by section 7 of
public act 07-156, is to read as follows:
"Sec. 36a-489. (Formerly Sec. 36-440d). Application for license. Denial of application for license. (a) If the commissioner finds, upon the filing of an application
for a mortgage lender or first mortgage broker license, that the applicant meets the
requirements of subsection (a) of section 36a-488, and that the financial responsibility,
character, reputation, integrity and general fitness of the applicant and of the partners
thereof if the applicant is a partnership, of the members if the applicant is a limited
liability company or association, and of the officers, directors and principal employees
if the applicant is a corporation, are such as to warrant belief that the business will be
operated soundly and efficiently, in the public interest and consistent with the purposes
of sections 36a-485 to 36a-498a, inclusive, the commissioner may thereupon issue the
applicant the license. If the commissioner fails to make such findings, or if the commissioner finds that the applicant has made a material misstatement in such application, the
commissioner shall not issue a license, and shall notify the applicant of the denial and
the reasons for such denial. Any denial of an application by the commissioner shall,
when applicable, be subject to the provisions of section 46a-80.
(b) Upon the filing of an application for an originator license, the commissioner
shall license the originator named in the application unless the commissioner finds that
such applicant has made a material misstatement in the application or that the financial
responsibility, character, reputation, integrity and general fitness of such originator are
not such as to warrant belief that granting such license would be in the public interest
and consistent with the purposes of sections 36a-485 to 36a-498a, inclusive. If the commissioner denies an application for an originator license, the commissioner shall notify
such applicant of the denial and the reasons for such denial. Any denial of an application
by the commissioner shall, when applicable, be subject to the provisions of section 46a-80. A license shall remain in force and effect until it has been surrendered, revoked,
suspended or expires in accordance with the provisions of sections 36a-485 to 36a-498a,
inclusive."
(P.A. 85-399, S. 5; P.A. 89-347, S. 12; P.A. 94-122, S. 233, 340; P.A. 99-36, S. 26; P.A. 02-111, S. 6; P.A. 04-69, S.
4; P.A. 06-45, S. 2; P.A. 07-156, S. 7.)
History: P.A. 89-347 extended the application of the section to mortgage brokers; P.A. 94-122 made technical changes,
effective January 1, 1995; Sec. 36-440d transferred to Sec. 36a-489 in 1995; P.A. 99-36 made technical changes; P.A. 02-111 designated existing provisions as Subsec. (a) and amended same by requiring commissioner to find that applicant
meets requirements of Sec. 36a-488(a), providing that application requirements extend to "partners" in a partnership, and
adding provisions re extending application requirements to "members if the applicant is a limited liability company", re
denial of license application based on material misstatement in application, and re denial of application subject to provisions
of Sec. 46a-80 and added Subsec. (b) re application for registration of originator; P.A. 04-69 substituted "36a-498a" for
"36a-498"; P.A. 06-45 amended Subsec. (a) to require commissioner to deny application for license if commissioner
finds that applicant made a material misstatement in application for registration of originator or files application for such
registration with knowledge that application contains a material misstatement by originator, and amended Subsec. (b) to
require commissioner to register originator named in application unless commissioner finds that originator has made a
material misstatement in application and to make technical changes, effective May 8, 2006; P.A. 07-156 replaced language
re application for registration of originator and registration with language re application for originator license and license
and made conforming changes, effective September 30, 2008.
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Sec. 36a-490. (Formerly Sec. 36-440e). *(See end of section for amended version and effective date.) License. (a) Each license shall state the location at which the
business is to be conducted and shall state fully the name of the licensee. If the licensee
desires to make first mortgage loans in more than one location or to act as a first mortgage
broker in more than one location, the licensee shall procure a license for each location
where the business is to be conducted. Each license shall be maintained at the location
for which the license was issued and shall be available for public inspection. Such license
shall not be transferable or assignable. No licensee shall use any name other than the
name stated on the license issued by the commissioner.
(b) A licensee may change the name or location specified on its license if (1) at least
twenty-one calendar days prior to such change, the licensee notifies the commissioner,
in writing, on a form satisfactory to the commissioner, and provides a bond rider or
endorsement to the surety bond on file with the commissioner that reflects the new name
or location, and (2) the commissioner does not disapprove such change, in writing,
or request further information within such twenty-one-day period. The licensee shall
promptly notify the commissioner, in writing, of any other change in the information
provided in the application for license or most recent renewal of such license.
(c) Each license shall remain in force and effect until it has been surrendered, revoked, suspended or expires in accordance with the provisions of sections 36a-485 to
36a-498a, inclusive.
(P.A. 85-399, S. 6; P.A. 89-347, S. 13; P.A. 94-122, S. 234, 340; P.A. 97-22, S. 1; P.A. 02-111, S. 7; P.A. 04-69, S. 5;
P.A. 07-91, S. 3.)
*Note: On and after September 30, 2008, this section, as amended by section 3 of
public act 07-91 and section 8 of public act 07-156, is to read as follows:
"Sec. 36a-490. (Formerly Sec. 36-440e). License. (a) Each mortgage lender and
first mortgage broker license shall state the location at which the business is to be conducted and shall state fully the name of the licensee. If the licensee desires to make first
mortgage loans in more than one location or to act as a first mortgage broker in more
than one location, the licensee shall procure a license for each location where the business
is to be conducted. Each license shall be maintained at the location for which the license
was issued and shall be available for public inspection. Such license shall not be transferable or assignable. No licensee shall use any name other than the name stated on the
license issued by the commissioner.
(b) A licensee may change the name or location specified on its license if (1) at least
twenty-one calendar days prior to such change, the licensee notifies the commissioner,
in writing, on a form satisfactory to the commissioner, and provides a bond rider or
endorsement to the surety bond on file with the commissioner that reflects the new name
or location, and (2) the commissioner does not disapprove such change, in writing,
or request further information within such twenty-one-day period. The licensee shall
promptly notify the commissioner, in writing, of any other change in the information
provided in the application for license or most recent renewal of such license.
(c) Each license shall remain in force and effect until it has been surrendered, revoked, suspended or expires in accordance with the provisions of sections 36a-485 to
36a-498a, inclusive."
(P.A. 85-399, S. 6; P.A. 89-347, S. 13; P.A. 94-122, S. 234, 340; P.A. 97-22, S. 1; P.A. 02-111, S. 7; P.A. 04-69, S. 5;
P.A. 07-91, S. 3; 07-156, S. 8.)
History: P.A. 89-347 amended Subsec. (a) by adding the reference to a licensee acting as a mortgage broker in more
than one location; P.A. 94-122 made technical changes, effective January 1, 1995; Sec. 36-440e transferred to Sec. 36a-490 in 1995; P.A. 97-22 made a technical change in Subsec. (a); P.A. 02-111 amended Subsec. (a) by changing requirement
re license from "prominently posted in each place of business of the licensee" to "maintained at the location for which the
license was issued and shall be available for public inspection", by changing requirement re change of location from
prior approval to prior written notice and by making technical changes, amended Subsec. (b) by deleting former notice
requirements and adding provision requiring licensee to promptly notify commissioner of any change in the information
provided in the application and amended Subsec. (c) by replacing reference to Sec. 36a-495 with reference to Sec. 36a-498; P.A. 04-69 amended Subsec. (c) to substitute "36a-498a" for "36a-498"; P.A. 07-91 amended Subsec. (a) to delete
provision requiring only prior written notice to commissioner for any change of location of a licensee, and amended Subsec.
(b) to allow licensee to change name or location specified on its license if, at least 21 calendar days prior to change, licensee
provides written notice to commissioner on a form satisfactory to commissioner and a bond rider or endorsement to surety
bond on file and commissioner does not disapprove change, in writing, or request further information within such 21-day
period; P.A. 07-156 amended Subsec. (a) to insert "mortgage lender and first mortgage broker" re license, effective September 30, 2008.
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Sec. 36a-491. (Formerly Sec. 36-440f). *(See end of section for amended version and effective date.) License and registration fees. Automatic suspension of
license or registration. Notice. Opportunity for hearing. (a)(1) Each applicant for a
first mortgage lender license or a first mortgage correspondent lender license shall, at
the time of making such application, pay to the commissioner a license fee of eight
hundred dollars, provided if such application is filed not earlier than one year before
the date such license will expire, the applicant shall pay to the commissioner a license
fee of four hundred dollars. Each applicant for a first mortgage broker license shall, at
the time of making such application, pay to the commissioner a license fee of four
hundred dollars, provided if such application is filed not earlier than one year before
the date such license will expire, the applicant shall pay to the commissioner a license
fee of two hundred dollars. Each license issued pursuant to section 36a-489 shall expire
at the close of business on September thirtieth of the even-numbered year following its
issuance unless such license is renewed. Such licensee shall, on or before September
first of the year in which the license expires, pay to the commissioner the appropriate
license fee as provided in this section for the succeeding two years, commencing October
first, together with such renewal application as the commissioner may require. Any
renewal application filed with the commissioner after September first shall be accompanied by a one-hundred-dollar late fee and any such filing shall be deemed to be timely
and sufficient for purposes of subsection (b) of section 4-182. Whenever an application
for a license, other than a renewal application, is filed under sections 36a-485 to 36a-498a, inclusive, by any person who was a licensee under said sections and whose license
expired less than sixty days prior to the date such application was filed, such application
shall be accompanied by a one-hundred-dollar processing fee in addition to the application fee.
(2) A licensee filing an application for registration of an originator shall, at the time
of making such application, pay to the commissioner a registration fee of one hundred
dollars for each such originator. Each registration shall expire at such time as the licensee's license expires unless such registration is renewed. Such licensee shall file an application for renewal of the registration and pay to the commissioner the appropriate registration fee as provided in this subsection for the succeeding two years, commencing
October first.
(3) (A) If the commissioner determines that a check filed with the commissioner
to pay a license fee under subdivision (1) of this subsection has been dishonored, the
commissioner shall automatically suspend the license or a renewal license that has been
issued but is not yet effective. The commissioner shall give the licensee notice of the
automatic suspension pending proceedings for revocation or refusal to renew and an
opportunity for a hearing on such actions in accordance with section 36a-51.
(B) If the commissioner determines that a check filed with the commissioner to pay
a registration fee has been dishonored, the commissioner shall automatically suspend
the registration or a registration that has been issued but is not yet effective. The commissioner shall give the originator notice of the automatic suspension and the licensee notice
of the automatic suspension pending proceedings for revocation or refusal to renew and
an opportunity for a hearing on such actions in accordance with section 36a-51.
(b) No abatement of the license or registration fee shall be made if the license or
registration is surrendered, revoked or suspended prior to the expiration of the period
for which it was issued. All fees required by this section shall be nonrefundable.
(P.A. 85-399, S. 7; P.A. 88-150, S. 5; P.A. 89-347, S. 14; P.A. 92-89, S. 7, 20; P.A. 94-104, S. 5; P.A. 96-71, S. 2, 8;
P.A. 99-36, S. 27; P.A. 02-111, S. 8; P.A. 04-69, S. 6; P.A. 05-46, S. 2; P.A. 06-45, S. 3.)
*Note: On and after September 30, 2008, this section, as amended by section 9 of
public act 07-156, is to read as follows:
"Sec. 36a-491. (Formerly Sec. 36-440f). License and processing fees. Expiration of licenses. Fees nonrefundable. (a)(1) Each applicant for a first mortgage lender
license, a first mortgage correspondent lender license or a first mortgage broker license
shall, at the time of making such application, pay to the national mortgage licensing
system the required license fee and processing fee for an initial or renewal application.
Each license issued pursuant to section 36a-489 shall expire at the close of business on
December thirty-first of the year following its issuance unless such license is renewed.
(2) Each applicant for an originator license shall, at the time of making such application, pay to the national mortgage licensing system the required license fee and processing fee for an initial or renewal application. Each such license shall expire at the
close of business on December thirty-first of the year following its issuance unless such
license is renewed.
(b) No abatement of the license fee shall be made if the license is surrendered,
revoked or suspended prior to the expiration of the period for which it was issued. All
fees required by this section shall be nonrefundable."
(P.A. 85-399, S. 7; P.A. 88-150, S. 5; P.A. 89-347, S. 14; P.A. 92-89, S. 7, 20; P.A. 94-104, S. 5; P.A. 96-71, S. 2, 8;
P.A. 99-36, S. 27; P.A. 02-111, S. 8; P.A. 04-69, S. 6; P.A. 05-46, S. 2; P.A. 06-45, S. 3; P.A. 07-156, S. 9.)
History: P.A. 88-150 amended Subsec. (a) by providing that the license fee is nonrefundable and adding the provision
re the expiration of licenses on September thirtieth; P.A. 89-347 added references to mortgage brokers, establishing license
fee for mortgage brokers; P.A. 92-89 increased the fee applicable to lender's and combination licenses from $250 to $400
and increased the fee applicable to broker's licenses from $100 to $200; P.A. 94-104 changed the license renewal deadline
from September tenth to September first and added a $100 late fee in Subsec. (a), and added Subsec. (a)(2) re applications
filed by a licensee whose license expired within 60 days of his application; Sec. 36-440f transferred to Sec. 36a-491 in
1995; P.A. 96-71 clarified that all license fees required by this section are nonrefundable, effective July 1, 1996; P.A. 99-36 made a technical change in Subsec. (a); P.A. 02-111 amended Subsec. (a) by providing for license expiration at the
close of business on September thirtieth of the even-numbered year following its issuance unless renewed, adding provisions
re fee of $800 for first mortgage lender and first mortgage correspondent lender licenses and fee of $400 for first mortgage
broker license, adding provisions re lesser fee if application filed not earlier than one year before expiration date, making
conforming and technical changes and incorporating provisions of existing Subdiv. (2) into Subdiv. (1) and adding new
Subdiv. (2) re application and fees for registration of originator, and amended Subsec. (b) by adding "or registration"; P.A.
04-69 amended Subsec. (a) to change reference to each license issued pursuant to section "36a-489", in lieu of "this"
section, and to substitute "36a-498a" for "36a-498" in Subdiv. (1), and add Subdiv. (3) requiring commissioner to automatically suspend license or registration if commissioner determines that a check filed to pay the license or registration fee has
been dishonored and requiring commissioner to give notice of the automatic suspension pending proceedings for revocation
or refusal to renew and an opportunity for a hearing in accordance with Sec. 36a-51; P.A. 05-46 amended Subsec. (a)(1)
to provide that renewal application filed with commissioner after September first, accompanied by late fee, shall be deemed
to be timely and sufficient for purposes of Sec. 4-182(b); P.A. 06-45 amended Subsec. (a)(2) to delete proviso re prorated
registration fee of $50 for originator for application filed not earlier than one year before date license expires; P.A. 07-156
amended Subsec. (a)(1) to delete requirement that applicants pay various license fees to commissioner and substitute
requirement that applicants, including applicants for a first mortgage broker license, pay the required license fee and
processing fee for an initial or renewal application to the national mortgage licensing system and to change date of expiration
of licenses issued pursuant to Sec. 36a-489 from September 30th of even-numbered year following issuance to December
31 of year following issuance, amended Subsec. (a)(2) to delete references to registration and to substitute references to
license re originators, to require applicants for originator license to pay required license and processing fees for an initial
or renewal application to the national mortgage licensing system in lieu of commissioner and to provide that license shall
expire on December 31 of year following issuance, deleted former Subsec. (a)(3), and amended Subsec. (b) to delete
references to registration, effective September 30, 2008.
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Sec. 36a-492. (Formerly Sec. 36-440g). *(See end of section for amended version of subsection (a) and effective date.) Surety bond required. Cancellation of
bond. Notice. Automatic suspension of license. Notice. Opportunity for hearing.
*(a) No such license, and no renewal thereof, shall be granted unless the applicant has
filed a bond with the commissioner written by a surety authorized to write such bonds
in this state, in the sum of forty thousand dollars, the form of which shall be approved
by the Attorney General. Such bond shall be conditioned upon such licensee faithfully
performing any and all written agreements or commitments with or for the benefit of
borrowers and prospective borrowers, truly and faithfully accounting for all funds received from a borrower or prospective borrower by the licensee in the licensee's capacity
as a mortgage lender or a first mortgage broker, and conducting such mortgage business
consistent with the provisions of sections 36a-485 to 36a-498a, inclusive. Any borrower
or prospective borrower who may be damaged by failure to perform any written
agreements or commitments, or by the wrongful conversion of funds paid by a borrower
or prospective borrower to a licensee, may proceed on such bond against the principal
or surety thereon, or both, to recover damages. The commissioner may proceed on such
bond against the principal or surety thereon, or both, to collect any civil penalty imposed
upon the licensee pursuant to subsection (a) of section 36a-50. The proceeds of the bond,
even if commingled with other assets of the licensee, shall be deemed by operation of
law to be held in trust for the benefit of such claimants against the licensee in the event
of bankruptcy of the licensee and shall be immune from attachment by creditors and
judgment creditors. The bond shall run concurrently with the period of the license
granted to the applicant, and the aggregate liability under the bond shall not exceed the
penal sum of the bond.
(b) The surety company shall have the right to cancel the bond at any time by a
written notice to the licensee stating the date cancellation shall take effect. Such notice
shall be sent by certified mail to the licensee at least thirty days prior to the date of
cancellation. A surety bond shall not be cancelled unless the surety company notifies
the commissioner in writing not less than thirty days prior to the effective date of cancellation. The commissioner shall automatically suspend the license on the date the cancellation takes effect, unless the surety bond has been replaced or renewed. The commissioner shall give the licensee notice of the automatic suspension pending proceedings
for revocation or refusal to renew and an opportunity for a hearing on such actions in
accordance with section 36a-51.
(P.A. 85-399, S. 8; P.A. 89-347, S. 15; P.A. 90-277; P.A. 94-122, S. 235, 340; P.A. 99-36, S. 28; P.A. 02-111, S. 9;
P.A. 04-69, S. 7.)
*Note: On and after September 30, 2008, subsection (a) of this section, as amended
by section 10 of public act 07-156, is to read as follows:
"(a) No mortgage lender or first mortgage broker license, and no renewal thereof,
shall be granted unless the applicant has filed a bond with the commissioner written by
a surety authorized to write such bonds in this state, in the sum of forty thousand dollars,
the form of which shall be approved by the Attorney General. Such bond shall be conditioned upon such licensee faithfully performing any and all written agreements or commitments with or for the benefit of borrowers and prospective borrowers, truly and
faithfully accounting for all funds received from a borrower or prospective borrower
by the licensee in the licensee's capacity as a mortgage lender or a first mortgage broker,
and conducting such mortgage business consistent with the provisions of sections 36a-485 to 36a-498a, inclusive. Any borrower or prospective borrower who may be damaged
by failure to perform any written agreements or commitments, or by the wrongful conversion of funds paid by a borrower or prospective borrower to a licensee, may proceed
on such bond against the principal or surety thereon, or both, to recover damages. The
commissioner may proceed on such bond against the principal or surety thereon, or
both, to collect any civil penalty imposed upon the licensee pursuant to subsection (a)
of section 36a-50. The proceeds of the bond, even if commingled with other assets of
the licensee, shall be deemed by operation of law to be held in trust for the benefit of
such claimants against the licensee in the event of bankruptcy of the licensee and shall
be immune from attachment by creditors and judgment creditors. The bond shall run
concurrently with the period of the license granted to the applicant, and the aggregate
liability under the bond shall not exceed the penal sum of the bond."
(P.A. 85-399, S. 8; P.A. 89-347, S. 15; P.A. 90-277; P.A. 94-122, S. 235, 340; P.A. 99-36, S. 28; P.A. 02-111, S. 9;
P.A. 04-69, S. 7; P.A. 07-156, S. 10.)
History: P.A. 89-347 extended the application of the section to mortgage brokers; P.A. 90-277 reduced the required bond
sum from $50,000 to $40,000; P.A. 94-122 made technical changes, effective January 1, 1995; Sec. 36-440g transferred to
Sec. 36a-492 in 1995; P.A. 99-36 made technical changes; P.A. 02-111 added provision re performance "for the benefit" of
borrowers and prospective borrowers, changed any "person" to any "borrower or perspective borrower", added provisions re
commissioner to proceed on bond to collect civil penalty imposed pursuant to Sec. 36a-50(a) and re bond proceeds deemed
to be held in trust and immune from attachment, and made conforming and technical changes; P.A. 04-69 designated
existing provisions as Subsec. (a), substituting "36a-498a" for "36a-498" therein, and added Subsec. (b) giving surety
company the right to cancel the bond at any time by written notice to licensee, specifying manner of notice, requiring
surety company to notify commissioner in writing prior to cancellation, requiring commissioner to automatically suspend
license on date cancellation takes effect, unless bond has been replaced or renewed, and requiring commissioner to give
licensee notice of automatic suspension pending proceedings for revocation or refusal to renew and an opportunity for a
hearing in accordance with Sec. 36a-51; P.A. 07-156 amended Subsec. (a) to insert "mortgage lender or first mortgage
broker" re license, effective September 30, 2008.
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Sec. 36a-493. (Formerly Sec. 36-440h). *(See end of section for amended version of subsection (a) and effective date.) Records to be maintained by licensee.
*(a) Each licensee shall maintain adequate records of each loan transaction at the location
named in the license, or shall make such records available at such location not later than
five business days after requested by the commissioner to do so. Such records shall
provide the following information: (1) A copy of any disclosures required under part
III of chapter 669; (2) whether the licensee acted as a mortgage lender, a first mortgage
broker or both; (3) if the licensee is acting as a mortgage lender, and retains the first
mortgage loan or receives payments thereon, an adequate loan history for those loans
retained or upon which payments are received, itemizing the amount and date of each
payment and the unpaid balance at all times; (4) the purpose for which the loan was
made; (5) the original or an exact copy of the note and mortgage deed; (6) a statement
signed by the borrowers acknowledging the receipt of such statement which discloses
the full amount of any fee, commission or consideration paid to the first mortgage broker
for all services in connection with the mortgage loan; and (7) the name and address of
the broker, if any, involved in the loan transaction.
(b) For each loan that is made and serviced by a licensee, the licensee shall retain
records of such loan transaction for not less than two years following the final payment
thereon, or the assignment of such loan, whichever occurs first, or such longer period
as may be required by any other provision of law.
(c) For each loan transaction in which a licensee acts as a mortgage lender or first
mortgage broker but does not service the loan, the licensee shall retain the records of
such loan transaction for not less than two years from the date of the transaction or such
longer period as may be required by any other provision of law.
(d) Any person who furnishes to a licensee any records required to be maintained
under this section or any information necessary to complete such records may charge
a fee to the licensee in an amount not to exceed fifty dollars.
(P.A. 85-399, S. 9; P.A. 89-347, S. 16; P.A. 90-184, S. 8; P.A. 94-122, S. 236, 340; P.A. 02-111, S. 10.)
*Note: On and after September 30, 2008, subsection (a) of this section, as amended
by section 11 of public act 07-156, is to read as follows:
"(a) Each mortgage lender and first mortgage broker licensee shall maintain adequate
records of each loan transaction at the location named in the license, or shall make such
records available at such location not later than five business days after requested by
the commissioner to do so. Such records shall provide the following information: (1)
A copy of any disclosures required under part III of chapter 669; (2) whether the licensee
acted as a mortgage lender, a first mortgage broker or both; (3) if the licensee is acting
as a mortgage lender, and retains the first mortgage loan or receives payments thereon,
an adequate loan history for those loans retained or upon which payments are received,
itemizing the amount and date of each payment and the unpaid balance at all times; (4)
the purpose for which the loan was made; (5) the original or an exact copy of the note
and mortgage deed; (6) a statement signed by the borrowers acknowledging the receipt
of such statement which discloses the full amount of any fee, commission or consideration paid to the first mortgage broker for all services in connection with the mortgage
loan; and (7) the name and address of the broker, if any, involved in the loan transaction."
(P.A. 85-399, S. 9; P.A. 89-347, S. 16; P.A. 90-184, S. 8; P.A. 94-122, S. 236, 340; P.A. 02-111, S. 10; P.A. 07-156,
S. 11.)
History: P.A. 89-347 amended Subsec. (a) by inserting new Subdiv. (2) requiring the licensee to state whether it acted
as a mortgage lender, a mortgage broker or any combination thereof and renumbering the remaining subdivisions in Subsec.
(a) and adding Subsec. (a)(6) re the borrower's statement, made a technical change in Subsec. (c) and added Subsec. (d)
re record retention requirements for mortgage brokers; P.A. 90-184 added Subsec. (e) authorizing a fee to be charged for
records or information furnished to a licensee; P.A. 94-122 changed "commissioner or his representative" to "commissioner" and "any combination thereof" to "both" in Subsec. (a), deleted Subsec. (b) re examination of books and records
of licensees, and relettered former Subsecs. (c) through (e) as Subsecs. (b) through (d), effective January 1, 1995; Sec. 36-440h transferred to Sec. 36a-493 in 1995; P.A. 02-111 amended Subsec. (a) to change where records are maintained or
made available from "place of business" to "location" named in the license, to replace references to "mortgage broker"
with reference to "first mortgage broker", to add new Subdiv. (7) re name and address of broker and to make technical
changes, amended Subsec. (b) to increase record retention period for licensees who make or service loans from one to two
years following final payment or assignment, or such longer retention period as may be required by law, and amended
Subsec. (c) by deleting reference to licensee acting as a "mortgage broker" and substituting "mortgage lender or first
mortgage broker but does not service the loan" and by making technical changes; P.A. 07-156 amended Subsec. (a) to
insert "mortgage lender and first mortgage broker" re licensee, effective September 30, 2008.
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Sec. 36a-494. (Formerly Sec. 36-440i). *(See end of section for amended version and effective date.) Suspension, revocation or refusal to renew license or registration or taking of other action. (a)(1) The commissioner may suspend, revoke or
refuse to renew any license or take any other action, in accordance with the provisions
of section 36a-51, for any reason which would be sufficient grounds for the commissioner to deny an application for a license under sections 36a-485 to 36a-498a, inclusive,
or if the commissioner finds that the licensee or any proprietor, director, officer, member,
partner, shareholder, trustee, employee or agent of such licensee has done any of the
following: (A) Made any material misstatement in the application; (B) committed any
fraud, misappropriated funds or misrepresented, concealed, suppressed, intentionally
omitted or otherwise intentionally failed to disclose any of the material particulars of
any first mortgage loan transaction, including disclosures required by subdivision (6)
of subsection (a) of section 36a-493, or part III of chapter 669 or regulations adopted
pursuant thereto, to anyone entitled to such information; (C) violated any of the provisions of this title or of any regulations adopted pursuant thereto, or any other law or
regulation applicable to the conduct of its business; or (D) failed to perform any
agreement with a licensee or a borrower.
(2) The commissioner may suspend, revoke or refuse to renew any registration of
an originator or take any other action, in accordance with the provisions of section 36a-51, for any reason which would be sufficient grounds for the commissioner to deny an
application for a registration under sections 36a-485 to 36a-498a, inclusive, or if the
commissioner finds that the registrant has committed any fraud, misappropriated funds,
misrepresented any of the material particulars of any first mortgage loan transaction or
has violated any of the provisions of this title or of any regulations adopted pursuant to
such title or any other law or regulation applicable to the conduct of such registrant's
business.
(b) Whenever it appears to the commissioner that any person has violated, is violating or is about to violate any of the provisions of sections 36a-485 to 36a-498a,
inclusive, or any regulation adopted pursuant thereto, or any licensee or registrant has
failed to perform any agreement with a borrower, committed any fraud, misappropriated
funds or misrepresented, concealed, suppressed, intentionally omitted or otherwise intentionally failed to disclose any of the material particulars of any mortgage loan transaction, including disclosures required by subdivision (6) of subsection (a) of section 36a-493, or part III of chapter 669 or regulations adopted pursuant thereto, to anyone entitled
to such information, the commissioner may take action against such person, licensee or
registrant in accordance with sections 36a-50 and 36a-52.
(P.A. 85-399, S. 10; P.A. 86-403, S. 78, 132; P.A. 88-230, S. 1, 12; P.A. 89-347, S. 17; P.A. 90-98, S. 1, 2; P.A. 93-142, S. 4, 7, 8; 93-194, S. 5, 7; P.A. 94-122, S. 237, 340; P.A. 99-36, S. 29; P.A. 00-61, S. 2, 9; P.A. 02-111, S. 11; P.A.
04-69, S. 8; P.A. 05-46, S. 3; P.A. 06-45, S. 4; P.A. 07-91, S. 17.)
*Note: On and after September 30, 2008, this section, as amended by section 17 of
public act 07-91 and section 12 of public act 07-156, is to read as follows:
"Sec. 36a-494. (Formerly Sec. 36-440i). Suspension, revocation or refusal to
renew license or taking of other action. (a)(1) The commissioner may suspend, revoke
or refuse to renew any mortgage lender or first mortgage broker license or take any
other action, in accordance with the provisions of section 36a-51, for any reason which
would be sufficient grounds for the commissioner to deny an application for such license
under sections 36a-485 to 36a-498a, inclusive, or if the commissioner finds that the
licensee or any proprietor, director, officer, member, partner, shareholder, trustee, employee or agent of such licensee has done any of the following: (A) Made any material
misstatement in the application; (B) committed any fraud, misappropriated funds or
misrepresented, concealed, suppressed, intentionally omitted or otherwise intentionally
failed to disclose any of the material particulars of any first mortgage loan transaction,
including disclosures required by subdivision (6) of subsection (a) of section 36a-493,
or part III of chapter 669 or regulations adopted pursuant thereto, to anyone entitled to
such information; (C) violated any of the provisions of this title or of any regulations
adopted pursuant thereto, or any other law or regulation applicable to the conduct of its
business; or (D) failed to perform any agreement with a licensee or a borrower.
(2) The commissioner may suspend, revoke or refuse to renew any originator license
or take any other action, in accordance with the provisions of section 36a-51, for any
reason which would be sufficient grounds for the commissioner to deny an application
for such license under sections 36a-485 to 36a-498a, inclusive, or if the commissioner
finds that the licensee has committed any fraud, misappropriated funds, misrepresented
any of the material particulars of any first mortgage loan transaction or has violated any
of the provisions of this title or of any regulations adopted pursuant to such title or any
other law or regulation applicable to the conduct of such licensee's business.
(b) Whenever it appears to the commissioner that any person has violated, is violating or is about to violate any of the provisions of sections 36a-485 to 36a-498a,
inclusive, or any regulation adopted pursuant thereto, or any licensee has failed to perform any agreement with a borrower, committed any fraud, misappropriated funds or
misrepresented, concealed, suppressed, intentionally omitted or otherwise intentionally
failed to disclose any of the material particulars of any mortgage loan transaction, including disclosures required by subdivision (6) of subsection (a) of section 36a-493, or part
III of chapter 669 or regulations adopted pursuant thereto, to anyone entitled to such
information, the commissioner may take action against such person or licensee in accordance with sections 36a-50 and 36a-52."
(P.A. 85-399, S. 10; P.A. 86-403, S. 78, 132; P.A. 88-230, S. 1, 12; P.A. 89-347, S. 17; P.A. 90-98, S. 1, 2; P.A. 93-142, S. 4, 7, 8; 93-194, S. 5, 7; P.A. 94-122, S. 237, 340; P.A. 99-36, S. 29; P.A. 00-61, S. 2, 9; P.A. 02-111, S. 11; P.A.
04-69, S. 8; P.A. 05-46, S. 3; P.A. 06-45, S. 4; P.A. 07-91, S. 17; 07-156, S. 12.)
History: P.A. 86-403 deleted reference to chapter 657a in Subsec. (a); P.A. 88-230 replaced "judicial district of Hartford-New Britain" with "judicial district of Hartford", effective September 1, 1991; P.A. 89-347 amended Subsec. (a) by adding
failure to make disclosures required by Sec. 36-440h(a)(6) as grounds for suspending, revoking or refusing to renew a
license; P.A. 90-98 changed the effective date of P.A. 88-230 from September 1, 1991, to September 1, 1993; P.A. 93-142 changed the effective date of P.A. 88-230 from September 1, 1993, to September 1, 1996, effective June 14, 1993;
P.A. 93-194 specified that provisions apply to persons who are not licensed as well as to licensees, effective June 23, 1993;
P.A. 94-122 deleted Subsec. (c) re cease and desist provisions and made technical changes, effective January 1, 1995; Sec.
36-440i transferred to Sec. 36a-494 in 1995; P.A. 99-36 made technical changes; P.A. 00-61 amended Subsec. (b) by
adding language re licensee's failure to perform an agreement with a borrower, effective July 1, 2000; P.A. 02-111 amended
Subsec. (a) by designating existing provisions as Subdiv. (1) and, within said Subdiv., redesignating existing Subdivs. (1)
to (4) as Subparas. (A) to (D), replacing "owner" with "proprietor", adding reference to misappropriated funds in Subpara.
(B), replacing former statutory references with reference to "this title" in Subpara. (C) and adding reference to licensee in
Subpara. (D), and by adding new Subdiv. (2) re commissioner's authority to suspend, revoke or refuse to renew registration
of originator; P.A. 04-69 substituted "36a-498a" for "36a-498" throughout and amended Subsec. (b) to allow commissioner
to take action against violator or licensee in accordance with Sec. 36a-52; P.A. 05-46 amended Subsec. (b) to allow
commissioner to impose civil penalty or issue cease and desist order against licensees and registrants who commit fraud,
misappropriate funds or misrepresent, conceal, suppress, intentionally omit or otherwise intentionally fail to disclose any
material particulars of mortgage loan transaction to anyone entitled to such information; P.A. 06-45 amended Subsec.
(a)(2) to provide that violations of title 36a or regulations or any other law applicable to conduct of registrant's business
are grounds for suspension, revocation or refusal to renew registration of originator, effective May 8, 2006; P.A. 07-91
amended Subsec. (a)(1) and (2) to authorize commissioner to take any other action, in accordance with provisions of Sec.
36a-51, effective June 5, 2007; P.A. 07-156 amended Subsec. (a)(1) to insert "mortgage lender or first mortgage broker"
re license, amended Subsec. (a)(2) to substitute "license" and "licensee" for "registration" and "registrant", and amended
Subsec. (b) to delete references to "registrant", effective September 30, 2008.
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Sec. 36a-496. (Formerly Sec. 36-440k). *(See end of section for amended version and effective date.) Applications and referrals from unlicensed first mortgage
brokers or unregistered originators. No person engaged in the business of making
first mortgage loans in this state, whether licensed in accordance with the provisions of
sections 36a-485 to 36a-498a, inclusive, or exempt from licensing, shall accept applications or referral of applicants from, or pay a fee to, any first mortgage broker or originator
who is required to be licensed or registered under said sections but is not licensed or
registered to act as such by the commissioner, if the mortgage lender has actual knowledge that the first mortgage broker or originator is not licensed or registered by the
commissioner.
(P.A. 01-306, S. 2; P.A. 02-111, S. 12; P. A. 04-69, S. 9.)
*Note: On and after September 30, 2008, this section, as amended by section 13 of
public act 07-156, is to read as follows:
"Sec. 36a-496. (Formerly Sec. 36-440k). Application and referrals from unlicensed first mortgage brokers or originators. No person engaged in the business
of making first mortgage loans in this state, whether licensed in accordance with the
provisions of sections 36a-485 to 36a-498a, inclusive, or exempt from licensing, shall
accept applications or referral of applicants from, or pay a fee to, any first mortgage
broker or originator who is required to be licensed under said sections but is not licensed
to act as such by the commissioner, if the mortgage lender has actual knowledge that
the first mortgage broker or originator is not licensed by the commissioner."
(P.A. 91-306, S. 2; P.A. 02-111, S. 12; P.A. 04-69, S. 9; P.A. 07-156, S. 13.)
History: Sec. 36-440k transferred to Sec. 36a-496 in 1995; P.A. 02-111 extended prohibition to include accepting
applications or referrals of applications from, or payment of fees to, unregistered originators and replaced references to
"mortgage broker" with references to "first mortgage broker"; P.A. 04-69 substituted "36a-498a" for "36a-498"; P.A. 07-156 deleted references to "registered", effective September 30, 2008.
| (Return to Chapter Table of Contents) | (Return to List of Chapters) | (Return to List of Titles) |
Sec. 36a-498. (Formerly Sec. 36-440m). *(See end of section for amended version and effective date.) Refundability of advance fees. Exceptions. Prohibited acts
by mortgage lenders and first mortgage brokers re borrowers. (a) Except as provided in subsection (c) of this section, every advance fee paid or given, directly or
indirectly, to a mortgage lender or first mortgage broker required to be licensed pursuant
to sections 36a-485 to 36a-498a, inclusive, shall be refundable.
(b) No originator required to be registered pursuant to sections 36a-485 to 36a-498a, inclusive, shall accept payment of any advance fee except an advance fee on behalf
of a licensee. Nothing in this subsection shall be construed as prohibiting the licensee
from paying an originator all or part of an advance fee, provided such advance fee paid
is not refundable under this section.
(c) Subsection (a) of this section shall not apply if: (1) The person providing the
advance fee and the mortgage lender or first mortgage broker agree in writing that the
advance fee shall not be refundable, in whole or in part; and (2) the written agreement
complies in all respects with the provisions of subsection (d) of this section.
(d) An agreement under subsection (c) of this section shall meet all of the following
requirements to be valid and enforceable: (1) The agreement shall be dated, signed by
both parties, and be executed prior to the payment of any advance fee; (2) the agreement
shall expressly state the total advance fee required to be paid and any amount of the
advance fee that shall not be refundable; (3) the agreement shall clearly and conspicuously state any conditions under which the advance fee will be retained by the licensee;
(4) the term "nonrefundable" shall be used to describe each advance fee or portion
thereof to which the term is applicable, and shall appear in boldface type in the agreement
each time it is used; and (5) the form of the agreement shall (A) be separate from any
other forms, contracts, or applications utilized by the licensee, (B) contain a heading in
a size equal to at least ten-point boldface type that shall title the form "AGREEMENT
CONCERNING NONREFUNDABILITY OF ADVANCE FEE", (C) provide for a duplicate copy which shall be given to the person paying the advance fee at the time of
payment of the advance fee, and (D) include such other specifications as the commissioner may by regulation prescribe.
(e) An agreement under subsection (c) of this section that does not meet the requirements of subsection (d) of this section shall be voidable at the election of the person
paying the advance fee.
(f) (1) No mortgage lender or first mortgage broker required to be licensed pursuant
to sections 36a-485 to 36a-498a, inclusive, shall enter into an agreement with or otherwise require any person to pay the mortgage lender or first mortgage broker for any fee,
commission or other valuable consideration lost as a result of such person failing to
consummate a first mortgage loan, provided the mortgage lender or first mortgage broker
may collect such fee, commission or consideration as an advance fee subject to the
requirements of this section.
(2) No first mortgage broker required to be licensed pursuant to sections 36a-485
to 36a-498a, inclusive, shall enter into an agreement with or otherwise require any person
to pay the first mortgage broker any fee, commission or other valuable consideration
for the prepayment of the principal of a first mortgage loan by such person before the
date on which the principal is due.
(g) (1) For the purposes of this subsection:
(A) "Unfair or deceptive act or practice" means (i) the failure to clearly and conspicuously state in the initial phase of the solicitation that the solicitor is not affiliated with
the lender or broker with which the consumer initially applied, (ii) the failure to clearly
and conspicuously state in the initial phase of the solicitation that the solicitation is
based on personal information about the consumer that was purchased, directly or indirectly, from a consumer reporting agency without the knowledge or permission of the
lender or broker with which the consumer initially applied, (iii) the failure in the initial
solicitation to comply with the provisions of the federal Fair Credit Reporting Act relating to prescreening solicitations that use consumer reports, including the requirement
to make a firm offer of credit to the consumer, or (iv) knowingly or negligently using
information from a mortgage trigger lead (I) to solicit consumers who have opted out
of prescreened offers of credit under the federal Fair Credit Reporting Act, or (II) to
place telephone calls to consumers who have placed their contact information on a
federal or state Do Not Call list; and
(B) "Mortgage trigger lead" means a consumer report obtained pursuant to Section
604 (c)(1)(B) of the federal Fair Credit Reporting Act, 15 USC 1681b, where the issuance
of the report is triggered by an inquiry made with a consumer reporting agency in response to an application for credit. "Mortgage trigger lead" does not include a consumer
report obtained by a lender that holds or services existing indebtedness of the applicant
who is the subject of the report.
(2) No mortgage lender or first mortgage broker shall engage in an unfair or deceptive act or practice in soliciting an application for a first mortgage loan when such
solicitation is based, in whole or in part, on information contained in a mortgage trigger
lead. Any violation of this subsection shall be deemed an unfair or deceptive trade
practice under subsection (a) of section 42-110b.
(P.A. 92-132, S. 4, 5; P.A. 94-122, S. 239, 340; P.A. 02-111, S. 14; P.A. 04-69, S. 10; P.A. 06-45, S. 5; P.A. 07-118,
S. 1.)
*Note: On and after September 30, 2008, this section, as amended by section 1 of
public act 07-118 and section 14 of public act 07-156, is to read as follows:
"Sec. 36a-498. (Formerly Sec. 36-440m). Refundability of advance fees. Exceptions. Prohibited acts by mortgage lenders and first mortgage brokers re borrowers. (a) Except as provided in subsection (c) of this section, every advance fee paid
or given, directly or indirectly, to a mortgage lender or first mortgage broker required
to be licensed pursuant to sections 36a-485 to 36a-498a, inclusive, shall be refundable.
(b) No originator required to be licensed pursuant to sections 36a-485 to 36a-498a,
inclusive, shall accept payment of any advance fee except an advance fee on behalf of
a mortgage lender or first mortgage broker licensee. Nothing in this subsection shall be
construed as prohibiting the mortgage lender or first mortgage broker licensee from
paying an originator all or part of an advance fee, provided such advance fee paid is not
refundable under this section.
(c) Subsection (a) of this section shall not apply if: (1) The person providing the
advance fee and the mortgage lender or first mortgage broker agree in writing that the
advance fee shall not be refundable, in whole or in part; and (2) the written agreement
complies in all respects with the provisions of subsection (d) of this section.
(d) An agreement under subsection (c) of this section shall meet all of the following
requirements to be valid and enforceable: (1) The agreement shall be dated, signed by
both parties, and be executed prior to the payment of any advance fee; (2) the agreement
shall expressly state the total advance fee required to be paid and any amount of the
advance fee that shall not be refundable; (3) the agreement shall clearly and conspicuously state any conditions under which the advance fee will be retained by the licensee;
(4) the term "nonrefundable" shall be used to describe each advance fee or portion
thereof to which the term is applicable, and shall appear in boldface type in the agreement
each time it is used; and (5) the form of the agreement shall (A) be separate from any
other forms, contracts, or applications utilized by the licensee, (B) contain a heading in
a size equal to at least ten-point boldface type that shall title the form "AGREEMENT
CONCERNING NONREFUNDABILITY OF ADVANCE FEE", (C) provide for a duplicate copy which shall be given to the person paying the advance fee at the time of
payment of the advance fee, and (D) include such other specifications as the commissioner may by regulation prescribe.
(e) An agreement under subsection (c) of this section that does not meet the requirements of subsection (d) of this section shall be voidable at the election of the person
paying the advance fee.
(f) (1) No mortgage lender or first mortgage broker required to be licensed pursuant
to sections 36a-485 to 36a-498a, inclusive, shall enter into an agreement with or otherwise require any person to pay the mortgage lender or first mortgage broker for any fee,
commission or other valuable consideration lost as a result of such person failing to
consummate a first mortgage loan, provided the mortgage lender or first mortgage broker
may collect such fee, commission or consideration as an advance fee subject to the
requirements of this section.
(2) No first mortgage broker required to be licensed pursuant to sections 36a-485
to 36a-498a, inclusive, shall enter into an agreement with or otherwise require any person
to pay the first mortgage broker any fee, commission or other valuable consideration
for the prepayment of the principal of a first mortgage loan by such person before the
date on which the principal is due.
(g) (1) For the purposes of this subsection:
(A) "Unfair or deceptive act or practice" means (i) the failure to clearly and conspicuously state in the initial phase of the solicitation that the solicitor is not affiliated with
the lender or broker with which the consumer initially applied, (ii) the failure to clearly
and conspicuously state in the initial phase of the solicitation that the solicitation is
based on personal information about the consumer that was purchased, directly or indirectly, from a consumer reporting agency without the knowledge or permission of the
lender or broker with which the consumer initially applied, (iii) the failure in the initial
solicitation to comply with the provisions of the federal Fair Credit Reporting Act relating to prescreening solicitations that use consumer reports, including the requirement
to make a firm offer of credit to the consumer, or (iv) knowingly or negligently using
information from a mortgage trigger lead (I) to solicit consumers who have opted out
of prescreened offers of credit under the federal Fair Credit Reporting Act, or (II) to
place telephone calls to consumers who have placed their contact information on a
federal or state Do Not Call list; and
(B) "Mortgage trigger lead" means a consumer report obtained pursuant to Section
604 (c)(1)(B) of the federal Fair Credit Reporting Act, 15 USC 1681b, where the issuance
of the report is triggered by an inquiry made with a consumer reporting agency in response to an application for credit. "Mortgage trigger lead" does not include a consumer
report obtained by a lender that holds or services existing indebtedness of the applicant
who is the subject of the report.
(2) No mortgage lender or first mortgage broker shall engage in an unfair or deceptive act or practice in soliciting an application for a first mortgage loan when such
solicitation is based, in whole or in part, on information contained in a mortgage trigger
lead. Any violation of this subsection shall be deemed an unfair or deceptive trade
practice under subsection (a) of section 42-110b."
(P.A. 92-132, S. 4, 5; P.A. 94-122, S. 239, 340; P.A. 02-111, S. 14; P.A. 04-69, S. 10; P.A. 06-45, S. 5; P.A. 07-118,
S. 1; 07-156, S. 14.)
History: P.A. 94-122 made technical changes, effective January 1, 1995; Sec. 36-440m transferred to Sec. 36a-498 in
1995; P.A. 02-111 replaced references to "mortgage broker" with references to "first mortgage broker" throughout, added
new Subsec. (b) re acceptance of advance fee by originator, redesignated existing Subsecs. (b) to (d) as Subsecs. (c) to (e)
and made technical changes throughout; P.A. 04-69 amended Subsecs. (a) and (b) to substitute "36a-498a" for "36a-498";
P.A. 06-45 added Subsec. (f) to prohibit mortgage lenders and first mortgage brokers from entering into agreements with
borrowers to compensate licensees for fees, commissions or other valuable consideration lost if borrowers fail to close
loan unless compensation is collected as advance fee and to prohibit first mortgage brokers from imposing fees, commissions
or other valuable consideration on borrowers for prepayment of principal of loan, effective May 8, 2006; P.A. 07-118
added Subsec. (g) to define "unfair or deceptive act or practice" and "mortgage trigger lead", to prohibit mortgage lenders
and first mortgage brokers from engaging in an unfair or deceptive act or practice in soliciting application for a first
mortgage loan if solicitation is based in any way on a mortgage trigger lead, and to provide that violation is deemed an
unfair or deceptive trade practice under Sec. 42-110b(a); P.A. 07-156 amended Subsec. (b) to substitute "licensed" for
"registered" and to insert "mortgage lender or first mortgage broker" re licensee, effective September 30, 2008.
| (Return to Chapter Table of Contents) | (Return to List of Chapters) | (Return to List of Titles) |
Sec. 36a-498a. *(See end of section for amended version and effective date.)
Prepaid finance charges; when prohibited. No licensee under section 36a-489 and
no person exempt from licensure under subdivisions (1), (2), (5) and (6) of section 36a-487 making a first mortgage loan shall charge, impose or cause to be paid, directly or
indirectly, prepaid finance charges that exceed in the aggregate, the greater of five per
cent of the principal amount of the loan or two thousand dollars. If the proceeds of the
loan are used to refinance an existing loan, the aggregate of the prepaid finance charges
for the current refinancing and any previous financings by such licensee or exempt
person or affiliate of such licensee or exempt person within two years of the current
refinancing shall not exceed the greater of five per cent of the principal amount of the
initial loan or two thousand dollars. The provisions of this section shall not prohibit
such licensee or exempt person from charging, imposing or causing to be paid, directly
or indirectly, prepaid finance charges in addition to those permitted by this section in
connection with any additional proceeds received by the borrower in the refinancing,
provided such prepaid finance charges on the additional proceeds shall not exceed five
per cent of the additional proceeds. For purposes of this section, "additional proceeds"
has the meaning given to that term in subdivision (3) of section 36a-746e and "prepaid
finance charge" has the meaning given to that term in subdivision (7) of section 36a-746a.
(P.A. 01-34, S. 13; P.A. 04-69, S. 11; P.A. 06-45, S. 6.)
*Note: On and after September 30, 2008, this section, as amended by section 15 of
public act 07-156, is to read as follows:
Sec. 36a-498a. Prepaid finance charges; when prohibited. No mortgage lender
or first mortgage broker licensee under section 36a-489 and no person exempt from
licensure under subdivisions (1), (2), (5) and (6) of section 36a-487 making a first mortgage loan shall charge, impose or cause to be paid, directly or indirectly, prepaid finance
charges that exceed in the aggregate, the greater of five per cent of the principal amount
of the loan or two thousand dollars. If the proceeds of the loan are used to refinance an
existing loan, the aggregate of the prepaid finance charges for the current refinancing
and any previous financings by such licensee or exempt person or affiliate of such
licensee or exempt person within two years of the current refinancing shall not exceed
the greater of five per cent of the principal amount of the initial loan or two thousand
dollars. The provisions of this section shall not prohibit such licensee or exempt person
from charging, imposing or causing to be paid, directly or indirectly, prepaid finance
charges in addition to those permitted by this section in connection with any additional
proceeds received by the borrower in the refinancing, provided such prepaid finance
charges on the additional proceeds shall not exceed five per cent of the additional proceeds. For purposes of this section, "additional proceeds" has the meaning given to that
term in subdivision (3) of section 36a-746e and "prepaid finance charge" has the meaning given to that term in subdivision (7) of section 36a-746a."
(P.A. 01-34, S. 13; P.A. 04-69, S. 11; P.A. 06-45, S. 6: P.A. 07-156, S. 15.)
History: P.A. 04-69 substituted Subdiv. "(7)" for "(6)" in definition of "prepaid finance charge"; P.A. 06-45 included
in prohibition against lenders charging borrowers excessive prepaid finance charges, persons making five or fewer first
mortgage loans within any period of 12 consecutive months, effective May 8, 2006; P.A. 07-156 inserted "mortgage lender
or first mortgage broker" re licensee, effective September 30, 2008.
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(B)*
SECONDARY MORTGAGE LENDERS, BROKERS AND ORIGINATORS
Sec. 36a-510. (Formerly Sec. 36-224a). *(See end of section for amended version and effective date.) Definitions. As used in sections 36a-510 to 36a-524, inclusive,
unless the context otherwise requires:
(1) "Advance fee" means any consideration paid or given, directly or indirectly, to
a mortgage lender, secondary mortgage broker or originator required to be licensed or
registered pursuant to sections 36a-510 to 36a-524, inclusive, prior to the closing of a
secondary mortgage loan to any person, including, but not limited to, loan fees, points,
broker's fees or commissions, transaction fees, or similar prepaid finance charges;
(2) "Advertise" or "advertisement" means the use of media, mail, computer, telephone, personal contact or any other means to offer the opportunity for a secondary
mortgage loan;
(3) "Licensee" means any person who is required to be licensed pursuant to section
36a-511;
(4) "Mortgage lender" means a secondary mortgage lender or a secondary mortgage
correspondent lender, or both;
(5) "Originator" means an individual who is employed or retained by, or otherwise
acts on behalf of, a mortgage lender or secondary mortgage broker that is licensed or
required to be licensed under sections 36a-510 to 36a-524, inclusive, for, or with the
expectation of, a fee, commission or other valuable consideration, to take an application
for or negotiate, solicit, arrange or find a secondary mortgage loan. "Originator" does
not include (1) an officer, if the licensee is a corporation; a general partner, if the licensee
is a partnership; a member, if the licensee is a limited liability company; or a sole proprietor, if the licensee is a sole proprietorship, or (2) an individual whose responsibilities
are limited to clerical and administrative tasks and who does not solicit borrowers, take
applications or negotiate the terms of loans;
(6) "Principal amount of the loan" means the gross loan amount the borrower is
obligated to repay including any prepaid finance charge and other charges which are
financed. The provisions of this subdivision apply to all loans negotiated before, on and
after June 14, 1993;
(7) "Secondary mortgage broker" means a person who, for a fee, commission or
other valuable consideration, directly or indirectly, negotiates, solicits, arranges, places
or finds a secondary mortgage loan that is to be made by a mortgage lender, whether
or not the mortgage lender is required to be licensed under sections 36a-510 to 36a-524,
inclusive;
(8) "Secondary mortgage correspondent lender" means a person engaged in the
business of making secondary mortgage loans in such person's own name where the
loans are not held by such person for more than ninety days and are funded by another
person through a warehouse agreement, table funding agreement or similar agreement;
(9) "Secondary mortgage lender" means a person engaged in the business of making
secondary mortgage loans: (A) In such person's own name utilizing such person's own
funds, or (B) by funding loans through a table funding agreement;
(10) "Secondary mortgage loan" means (A) a loan or an extension of credit, including, but not limited to, an extension of credit pursuant to a contract or an assigned contract
for the sale of goods or services, made to a person, the proceeds of which are to be used
primarily for personal, family or household purposes, and which is secured in whole or
in part by a mortgage upon any interest in one-to-four-family residential owner-occupied
real property located in this state, provided such real property is subject to one or more
prior mortgages, and (B) the renewal or refinancing of any existing loan or extension
of credit described in subparagraph (A) of this subdivision;
(11) "Simulated check" means a document that imitates or resembles a check but
is not a negotiable instrument;
(12) "Table funding agreement" has the meaning given to that term in subdivision
(11) of section 36a-485; and
(13) "Warehouse agreement" has the meaning given to that term in subdivision (12)
of section 36a-485.
(P.A. 77-228, S. 1; 77-614, S. 161, 587, 610; P.A. 78-216, S. 1, 7; 78-303, S. 85, 136; P.A. 80-482, S. 251, 345, 348;
P.A. 87-9, S. 2, 3; P.A. 90-184, S. 1; P.A. 92-12, S. 64; 92-132, S. 1, 5; P.A. 93-130, S. 1, 3; P.A. 94-122, S. 240, 340;
P.A. 99-63, S. 4; P.A. 02-111, S. 15; P.A. 07-91, S. 4.)
*Note: On and after September 30, 2008, this section, as amended by section 4 of
public act 07-91 and section 16 of public act 07-156, is to read as follows:
"Sec. 36a-510. (Formerly Sec. 36-224a). Definitions. As used in sections 36a-510 to 36a-524, inclusive, unless the context otherwise requires:
(1) "Advance fee" means any consideration paid or given, directly or indirectly, to
a mortgage lender, secondary mortgage broker or originator required to be licensed
pursuant to sections 36a-510 to 36a-524, inclusive, prior to the closing of a secondary
mortgage loan to any person, including, but not limited to, loan fees, points, broker's
fees or commissions, transaction fees, or similar prepaid finance charges;
(2) "Advertise" or "advertisement" means the use of media, mail, computer, telephone, personal contact or any other means to offer the opportunity for a secondary
mortgage loan;
(3) "Licensee" means any person who is required to be licensed pursuant to section
36a-511;
(4) "Mortgage lender" means a secondary mortgage lender or a secondary mortgage
correspondent lender, or both;
(5) "Originator" means an individual who is employed or retained by a mortgage
lender or secondary mortgage broker that is required to be licensed under sections 36a-510 to 36a-524, inclusive, for, or with the expectation of, a fee, commission or other
valuable consideration, to negotiate, solicit, arrange or find a secondary mortgage loan.
"Originator" does not include an officer, if the mortgage lender or secondary mortgage
broker licensee is a corporation; a general partner, if the licensee is a partnership; a
member, if the licensee is a limited liability company; or a sole proprietor, if the licensee
is a sole proprietorship;
(6) "Principal amount of the loan" means the gross loan amount the borrower is
obligated to repay including any prepaid finance charge and other charges which are
financed. The provisions of this subdivision apply to all loans negotiated before, on and
after June 14, 1993;
(7) "Secondary mortgage broker" means a person who, for a fee, commission or
other valuable consideration, directly or indirectly, negotiates, solicits, arranges, places
or finds a secondary mortgage loan that is to be made by a mortgage lender, whether
or not the mortgage lender is required to be licensed under sections 36a-510 to 36a-524,
inclusive;
(8) "Secondary mortgage correspondent lender" means a person engaged in the
business of making secondary mortgage loans in such person's own name where the
loans are not held by such person for more than ninety days and are funded by another
person through a warehouse agreement, table funding agreement or similar agreement;
(9) "Secondary mortgage lender" means a person engaged in the business of making
secondary mortgage loans: (A) In such person's own name utilizing such person's own
funds, or (B) by funding loans through a table funding agreement;
(10) "Secondary mortgage loan" means (A) a loan or an extension of credit, including, but not limited to, an extension of credit pursuant to a contract or an assigned contract
for the sale of goods or services, made to a person, the proceeds of which are to be used
primarily for personal, family or household purposes, and which is secured in whole or
in part by a mortgage upon any interest in one-to-four-family residential owner-occupied
real property located in this state, provided such real property is subject to one or more
prior mortgages, and (B) the renewal or refinancing of any existing loan or extension
of credit described in subparagraph (A) of this subdivision;
(11) "Simulated check" means a document that imitates or resembles a check but
is not a negotiable instrument;
(12) "Table funding agreement" has the meaning given to that term in subdivision
(11) of section 36a-485; and
(13) "Warehouse agreement" has the meaning given to that term in subdivision (12)
of section 36a-485."
(P.A. 77-228, S. 1; 77-614, S. 161, 587, 610; P.A. 78-216, S. 1, 7; 78-303, S. 85, 136; P.A. 80-482, S. 251, 345, 348;
P.A. 87-9, S. 2, 3; P.A. 90-184, S. 1; P.A. 92-12, S. 64; 92-132, S. 1, 5; P.A. 93-130, S. 1, 3; P.A. 94-122, S. 240, 340;
P.A. 99-63, S. 4; P.A. 02-111, S. 15; P.A. 07-91, S. 4; 07-156, S. 16.)
History: P.A. 77-614 and P.A. 78-303 replaced bank commissioner with banking commissioner within the department
of business regulation, effective January 1, 1979; P.A. 78-216 added Subdivs. (e) and (f) defining "lender" and "broker";
P.A. 80-482 deleted reference to abolished department of business regulation and restored commissioner as head of independent banking department (as was the case before P.A. 77-614 which had made banking department a division within the
department of business regulation); (Revisor's note: Pursuant to P.A. 87-9 "banking commissioner" was changed editorially
by the Revisors to "commissioner of banking"); P.A. 90-184 amended the definition of "secondary mortgage loan" in
Subsec. (a) and amended the definition of "broker" in Subsec. (f); P.A. 92-12 redesignated Subsecs. and Subdivs. and
made technical changes; P.A. 92-132 added Subdiv. (7) defining "advance fee"; P.A. 93-130 added Subdiv. (8) defining
"principal amount of the loan", effective June 14, 1993; P.A. 94-122 deleted definitions of "commissioner" and "person"
and alphabetized remaining definitions with technical changes, effective January 1, 1995; Sec. 36-224a transferred to Sec.
36a-510 in 1995; P.A. 99-63 added new Subdivs. (7) and (8) defining "simulated check" and "advertise" or "advertisement";
P.A. 02-111 deleted definitions of "broker" and "lender", redefined "advance fee", and added definitions of "mortgage
lender", "originator", "secondary mortgage broker", "secondary mortgage correspondent lender", "secondary mortgage
lender", "table funding agreement" and "warehouse agreement", renumbering Subdivs. accordingly; P.A. 07-91 redefined
"originator" in Subdiv. (5); P.A. 07-156 redefined "advance fee" in Subdiv. (1) to delete "or registered", and redefined
"originator" in Subdiv. (5) to insert "mortgage lender or secondary mortgage broker" in exclusion re officer, effective
September 30, 2008.
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Sec. 36a-511. (Formerly Sec. 36-224b). *(See end of section for amended version and effective date.) License required. Registration of originator. Violations.
(a) No person shall engage in the business of making secondary mortgage loans or act
as a secondary mortgage broker unless such person has first obtained the required license
under sections 36a-510 to 36a-524, inclusive. A person shall be deemed to be engaged
in the business of making secondary mortgage loans if such person advertises, causes
to be advertised, solicits, offers to make or makes secondary mortgage loans, either
directly or indirectly. A secondary mortgage correspondent lender shall not be deemed
to be acting as a secondary mortgage lender if such secondary mortgage correspondent
lender makes a loan utilizing its own funds in a situation where another person does not
honor such person's commitment to fund the loan.
(b) No licensee shall employ or retain an originator without first registering such
originator under sections 36a-510 to 36a-524, inclusive, provided such registration shall
not be required for any originator who is registered by such licensee under sections
36a-485 to 36a-498a, inclusive. No individual may act as an originator without being
registered, or act as an originator, as defined in sections 36a-485 and 36a-510, for more
than one person. The registration of an originator is not effective during any period when
such originator is not associated with a licensee. Both the originator and the licensee shall
promptly notify the commissioner, in writing, of the termination of employment or
services of an originator.
(c) Each secondary mortgage loan negotiated, solicited, placed, found or made without a license shall constitute a separate violation for purposes of section 36a-50.
(P.A. 77-228, S. 2; 77-604, S. 81, 84; P.A. 78-216, S. 2, 7; P.A. 90-184, S. 2; P.A. 94-122, S. 241, 340; P.A. 02-111,
S. 16; P.A. 04-69, S. 12.)
*Note: On and after September 30, 2008, this section, as amended by section 17 of
public act 07-156, is to read as follows:
"Sec. 36a-511. (Formerly Sec. 36-224b). License required. Violations. (a) No
person shall engage in the business of making secondary mortgage loans or act as a
secondary mortgage broker unless such person has first obtained the required license
under sections 36a-510 to 36a-524, inclusive. A person shall be deemed to be engaged
in the business of making secondary mortgage loans if such person advertises, causes
to be advertised, solicits, offers to make or makes secondary mortgage loans, either
directly or indirectly. A secondary mortgage correspondent lender shall not be deemed
to be a