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Catalyst Mortgage Solutions - Law Library
Law Library
OverviewView Law
Secure And Fair Enforcement For Mortgage Licensing
National Statute
12 USC Ch. 51

Eff: 8/1/2009
Secure and Fair Enforcement for Mortgage Licensing
12 USC Sec. 5101

Eff: 8/1/2009
Section 5101 - Purposes and methods for establishing a mortgage licensing system and registry
12 USC Sec. 5102

Eff: 8/1/2009
Section 5102 - Definitions
12 USC Sec. 5103

Eff: 8/1/2009
Section 5103 - License or registration required
  1. 12 USC Sec. 5103(a)
    In general
    Subject to the existence of a licensing or registration regime, as the case may be, an individual may not engage in the business of a loan originator without first -
    1. 12 USC Sec. 5103(a)(1)
      obtaining, and maintaining annually -
      1. 12 USC Sec. 5103(a)(1)(A)
        a registration as a registered loan originator; or
      2. 12 USC Sec. 5103(a)(1)(B)
        a license and registration as a State-licensed loan originator; and
    2. 12 USC Sec. 5103(a)(2)
      obtaining a unique identifier.
  2. 12 USC Sec. 5103(b)
    Loan processors and underwriters
    1. 12 USC Sec. 5103(b)(1)
      Supervised loan processors and underwriters
      A loan processor or underwriter who does not represent to the public, through advertising or other means of communicating or providing information (including the use of business cards, stationery, brochures, signs, rate lists, or other promotional items), that such individual can or will perform any of the activities of a loan originator shall not be required to be a State-licensed loan originator.
    2. 12 USC Sec. 5103(b)(2)
      Independent contractors
      An independent contractor may not engage in residential mortgage loan origination activities as a loan processor or underwriter unless such independent contractor is a State-licensed loan originator.
12 USC Sec. 5104

Eff: 8/1/2009
Section 5104 - State license and registration application and issuance
  1. 12 USC Sec. 5104(a)
    Background checks
    In connection with an application to any State for licensing and registration as a State-licensed loan originator, the applicant shall, at a minimum, furnish to the Nationwide Mortgage Licensing System and Registry information concerning the applicant's identity, including -
    1. 12 USC Sec. 5104(a)(1)
      fingerprints for submission to the Federal Bureau of Investigation, and any governmental agency or entity authorized to receive such information for a State and national criminal history background check; and
    2. 12 USC Sec. 5104(a)(2)
      personal history and experience, including authorization for the System to obtain -
      1. 12 USC Sec. 5104(a)(2)(A)
        an independent credit report obtained from a consumer reporting agency described in section 1681a(p) of title 15; and
      2. 12 USC Sec. 5104(a)(2)(B)
        information related to any administrative, civil or criminal findings by any governmental jurisdiction.
  2. 12 USC Sec. 5104(b)
    Issuance of license
    The minimum standards for licensing and registration as a State-licensed loan originator shall include the following:
    1. 12 USC Sec. 5104(b)(1)
      The applicant has never had a loan originator license revoked in any governmental jurisdiction.
    2. 12 USC Sec. 5104(b)(2)
      The applicant has not been convicted of, or pled guilty or nolo contendere to, a felony in a domestic, foreign, or military court -
      1. 12 USC Sec. 5104(b)(2)(A)
        during the 7-year period preceding the date of the application for licensing and registration; or
      2. 12 USC Sec. 5104(b)(2)(B)
        at any time preceding such date of application, if such felony involved an act of fraud, dishonesty, or a breach of trust, or money laundering.
    3. 12 USC Sec. 5104(b)(3)
      The applicant has demonstrated financial responsibility, character, and general fitness such as to command the confidence of the community and to warrant a determination that the loan originator will operate honestly, fairly, and efficiently within the purposes of this chapter.
    4. 12 USC Sec. 5104(b)(4)
      The applicant has completed the pre-licensing education requirement described in subsection (c).
    5. 12 USC Sec. 5104(b)(5)
      The applicant has passed a written test that meets the test requirement described in subsection (d).
    6. 12 USC Sec. 5104(b)(6)
      The applicant has met either a net worth or surety bond requirement, or paid into a State fund, as required by the State pursuant to section 5107(d)(6) of this title.
  3. 12 USC Sec. 5104(c)
    Pre-licensing education of loan originators
    1. 12 USC Sec. 5104(c)(1)
      Minimum educational requirements
      In order to meet the pre-licensing education requirement referred to in subsection (b)(4), a person shall complete at least 20 hours of education approved in accordance with paragraph (2), which shall include at least -
      1. 12 USC Sec. 5104(c)(1)(A)
        3 hours of Federal law and regulations;
      2. 12 USC Sec. 5104(c)(1)(B)
        3 hours of ethics, which shall include instruction on fraud, consumer protection, and fair lending issues; and
      3. 12 USC Sec. 5104(c)(1)(C)
        2 hours of training related to lending standards for the nontraditional mortgage product marketplace.
    2. 12 USC Sec. 5104(c)(2)
      Approved educational courses
      For purposes of paragraph (1), pre-licensing education courses shall be reviewed, and approved by the Nationwide Mortgage Licensing System and Registry.
    3. 12 USC Sec. 5104(c)(3)
      Limitation and standards
      1. 12 USC Sec. 5104(c)(3)(A)
        Limitation
        To maintain the independence of the approval process, the Nationwide Mortgage Licensing System and Registry shall not directly or indirectly offer pre-licensure educational courses for loan originators.
      2. 12 USC Sec. 5104(c)(3)(B)
        Standards
        In approving courses under this section, the Nationwide Mortgage Licensing System and Registry shall apply reasonable standards in the review and approval of courses.
  4. 12 USC Sec. 5104(d)
    Testing of loan originators
    1. 12 USC Sec. 5104(d)(1)
      In general
      In order to meet the written test requirement referred to in subsection (b)(5), an individual shall pass, in accordance with the standards established under this subsection, a qualified written test developed by the Nationwide Mortgage Licensing System and Registry and administered by an approved test provider.
    2. 12 USC Sec. 5104(d)(2)
      Qualified test
      A written test shall not be treated as a qualified written test for purposes of paragraph (1) unless the test adequately measures the applicant's knowledge and comprehension in appropriate subject areas, including -
      1. 12 USC Sec. 5104(d)(2)(A)
        ethics;
      2. 12 USC Sec. 5104(d)(2)(B)
        Federal law and regulation pertaining to mortgage origination;
      3. 12 USC Sec. 5104(d)(2)(C)
        State law and regulation pertaining to mortgage origination;
      4. 12 USC Sec. 5104(d)(2)(D)
        Federal and State law and regulation, including instruction on fraud, consumer protection, the nontraditional mortgage marketplace, and fair lending issues.
    3. 12 USC Sec. 5104(d)(3)
      Minimum competence
      1. 12 USC Sec. 5104(d)(3)(A)
        Passing score
        An individual shall not be considered to have passed a qualified written test unless the individual achieves a test score of not less than 75 percent correct answers to questions.
      2. 12 USC Sec. 5104(d)(3)(B)
        Initial retests
        An individual may retake a test 3 consecutive times with each consecutive taking occurring at least 30 days after the preceding test.
      3. 12 USC Sec. 5104(d)(3)(C)
        Subsequent retests
        After failing 3 consecutive tests, an individual shall wait at least 6 months before taking the test again.
      4. 12 USC Sec. 5104(d)(3)(D)
        Retest after lapse of license
        A State-licensed loan originator who fails to maintain a valid license for a period of 5 years or longer shall retake the test, not taking into account any time during which such individual is a registered loan originator.
  5. 12 USC Sec. 5104(e)
    Mortgage call reports
    Each mortgage licensee shall submit to the Nationwide Mortgage Licensing System and Registry reports of condition, which shall be in such form and shall contain such information as the Nationwide Mortgage Licensing System and Registry may require.
12 USC Sec. 5105

Eff: 8/1/2009
Section 5105 - Standards for State license renewal
  1. 12 USC Sec. 5105(a)
    In general
    The minimum standards for license renewal for State-licensed loan originators shall include the following:
    1. 12 USC Sec. 5105(a)(1)
      The loan originator continues to meet the minimum standards for license issuance.
    2. 12 USC Sec. 5105(a)(2)
      The loan originator has satisfied the annual continuing education requirements described in subsection (b).
  2. 12 USC Sec. 5105(b)
    Continuing education for State-licensed loan originators
    1. 12 USC Sec. 5105(b)(1)
      In general
      In order to meet the annual continuing education requirements referred to in subsection (a)(2), a State-licensed loan originator shall complete at least 8 hours of education approved in accordance with paragraph (2), which shall include at least -
      1. 12 USC Sec. 5105(b)(1)(A)
        3 hours of Federal law and regulations;
      2. 12 USC Sec. 5105(b)(1)(B)
        2 hours of ethics, which shall include instruction on fraud, consumer protection, and fair lending issues; and
      3. 12 USC Sec. 5105(b)(1)(C)
        2 hours of training related to lending standards for the nontraditional mortgage product marketplace.
    2. 12 USC Sec. 5105(b)(2)
      Approved educational courses
      For purposes of paragraph (1), continuing education courses shall be reviewed, and approved by the Nationwide Mortgage Licensing System and Registry.
    3. 12 USC Sec. 5105(b)(3)
      Calculation of continuing education credits
      A State-licensed loan originator -
      1. 12 USC Sec. 5105(b)(3)(A)
        may only receive credit for a continuing education course in the year in which the course is taken; and
      2. 12 USC Sec. 5105(b)(3)(B)
        may not take the same approved course in the same or successive years to meet the annual requirements for continuing education.
    4. 12 USC Sec. 5105(b)(4)
      Instructor credit
      A State-licensed loan originator who is approved as an instructor of an approved continuing education course may receive credit for the originator's own annual continuing education requirement at the rate of 2 hours credit for every 1 hour taught.
    5. 12 USC Sec. 5105(b)(5)
      Limitation and standards
      1. 12 USC Sec. 5105(b)(5)(A)
        Limitation
        To maintain the independence of the approval process, the Nationwide Mortgage Licensing System and Registry shall not directly or indirectly offer any continuing education courses for loan originators.
      2. 12 USC Sec. 5105(b)(5)(B)
        Standards
        In approving courses under this section, the Nationwide Mortgage Licensing System and Registry shall apply reasonable standards in the review and approval of courses.
12 USC Sec. 5106

Eff: 8/1/2009
Section 5106 - System of registration administration by Federal agencies
  1. 12 USC Sec. 5106(a)
    Development
    1. 12 USC Sec. 5106(a)(1)
      In general
      The Bureau shall develop and maintain a system for registering employees of a depository institution, employees of a subsidiary that is owned and controlled by a depository institution and regulated by a Federal banking agency, or employees of an institution regulated by the Farm Credit Administration, as registered loan originators with the Nationwide Mortgage Licensing System and Registry. The system shall be implemented before the end of the 1-year period beginning on July 21, 2010.
    2. 12 USC Sec. 5106(a)(2)
      Registration requirements
      In connection with the registration of any loan originator under this subsection, the Bureau shall, at a minimum, furnish or cause to be furnished to the Nationwide Mortgage Licensing System and Registry information concerning the identity of the employee, including -
      1. 12 USC Sec. 5106(a)(2)(A)
        fingerprints for submission to the Federal Bureau of Investigation, and any governmental agency or entity authorized to receive such information for a State and national criminal history background check; and
      2. 12 USC Sec. 5106(a)(2)(B)
        personal history and experience, including authorization for the Nationwide Mortgage Licensing System and Registry to obtain information related to any administrative, civil or criminal findings by any governmental jurisdiction.
  2. 12 USC Sec. 5106(b)
    Coordination
    1. 12 USC Sec. 5106(b)(1)
      Unique identifier
      The Bureau, and the Bureau of Consumer Financial Protection shall coordinate with the Nationwide Mortgage Licensing System and Registry to establish protocols for assigning a unique identifier to each registered loan originator that will facilitate electronic tracking and uniform identification of, and public access to, the employment history of and publicly adjudicated disciplinary and enforcement actions against loan originators.
    2. 12 USC Sec. 5106(b)(2)
      Nationwide Mortgage Licensing System and Registry development
      To facilitate the transfer of information required by subsection (a)(2), the Nationwide Mortgage Licensing System and Registry shall coordinate with the Bureau, and the Bureau of Consumer Financial Protection concerning the development and operation, by such System and Registry, of the registration functionality and data requirements for loan originators.
  3. 12 USC Sec. 5106(c)
    Consideration of factors and procedures
    In establishing the registration procedures under subsection (a) and the protocols for assigning a unique identifier to a registered loan originator, the Bureau shall make such de minimis exceptions as may be appropriate to paragraphs (1)(A) and (2) of section 5103(a) of this title, shall make reasonable efforts to utilize existing information to minimize the burden of registering loan originators, and shall consider methods for automating the process to the greatest extent practicable consistent with the purposes of this chapter.
12 USC Sec. 5107

Eff: 8/1/2009
Section 5107 - Bureau of Consumer Financial Protection backup authority to establish loan originator licensing system
  1. 12 USC Sec. 5107(a)
    Backup licensing system
    If, by the end of the 1-year period, or the 2-year period in the case of a State whose legislature meets only biennially, beginning on July 30, 2008, or at any time thereafter, the Director determines that a State does not have in place by law or regulation a system for licensing and registering loan originators that meets the requirements of sections 5104 and 5105 of this title and subsection (d) of this section, or does not participate in the Nationwide Mortgage Licensing System and Registry, the Director shall provide for the establishment and maintenance of a system for the licensing and registration by the Director of loan originators operating in such State as State-licensed loan originators.
  2. 12 USC Sec. 5107(b)
    Licensing and registration requirements
    The system established by the Director under subsection (a) for any State shall meet the requirements of sections 5104 and 5105 of this title for State-licensed loan originators.
  3. 12 USC Sec. 5107(c)
    Unique identifier
    The Director shall coordinate with the Nationwide Mortgage Licensing System and Registry to establish protocols for assigning a unique identifier to each loan originator licensed by the Director as a State-licensed loan originator that will facilitate electronic tracking and uniform identification of, and public access to, the employment history of and the publicly adjudicated disciplinary and enforcement actions against loan originators.
  4. 12 USC Sec. 5107(d)
    State licensing law requirements
    For purposes of this section, the law in effect in a State meets the requirements of this subsection if the Director determines the law satisfies the following minimum requirements:
    1. 12 USC Sec. 5107(d)(1)
      A State loan originator supervisory authority is maintained to provide effective supervision and enforcement of such law, including the suspension, termination, or nonrenewal of a license for a violation of State or Federal law.
    2. 12 USC Sec. 5107(d)(2)
      The State loan originator supervisory authority ensures that all State-licensed loan originators operating in the State are registered with Nationwide Mortgage Licensing System and Registry.
    3. 12 USC Sec. 5107(d)(3)
      The State loan originator supervisory authority is required to regularly report violations of such law, as well as enforcement actions and other relevant information, to the Nationwide Mortgage Licensing System and Registry.
    4. 12 USC Sec. 5107(d)(4)
      The State loan originator supervisory authority has a process in place for challenging information contained in the Nationwide Mortgage Licensing System and Registry.
    5. 12 USC Sec. 5107(d)(5)
      The State loan originator supervisory authority has established a mechanism to assess civil money penalties for individuals acting as mortgage originators in their State without a valid license or registration.
    6. 12 USC Sec. 5107(d)(6)
      The State loan originator supervisory authority has established minimum net worth or surety bonding requirements that reflect the dollar amount of loans originated by a residential mortgage loan originator, or has established a recovery fund paid into by the loan originators.
  5. 12 USC Sec. 5107(e)
    Temporary extension of period
    The Director may extend, by not more than 24 months, the 1-year or 2-year period, as the case may be, referred to in subsection (a) for the licensing of loan originators in any State under a State licensing law that meets the requirements of sections 5104 and 5105 of this title and subsection (d) if the Director determines that such State is making a good faith effort to establish a State licensing law that meets such requirements, license mortgage originators under such law, and register such originators with the Nationwide Mortgage Licensing System and Registry.
  6. 12 USC Sec. 5107(f)
    Regulation authority
    1. 12 USC Sec. 5107(f)(1)
      In general
      The Bureau is authorized to promulgate regulations setting minimum net worth or surety bond requirements for residential mortgage loan originators and minimum requirements for recovery funds paid into by loan originators.
    2. 12 USC Sec. 5107(f)(2)
      Considerations
      In issuing regulations under paragraph (1), the Bureau shall take into account the need to provide originators adequate incentives to originate affordable and sustainable mortgage loans, as well as the need to ensure a competitive origination market that maximizes consumer access to affordable and sustainable mortgage loans.
12 USC Sec. 5108

Eff: 8/1/2009
Section 5108 - Backup authority to establish a nationwide mortgage licensing and registry system
12 USC Sec. 5109

Eff: 8/1/2009
Section 5109 - Fees
12 USC Sec. 5110

Eff: 8/1/2009
Section 5110 - Background checks of loan originators
  1. 12 USC Sec. 5110(a)
    Access to records
    Notwithstanding any other provision of law, in providing identification and processing functions, the Attorney General shall provide access to all criminal history information to the appropriate State officials responsible for regulating State- licensed loan originators to the extent criminal history background checks are required under the laws of the State for the licensing of such loan originators.
  2. 12 USC Sec. 5110(b)
    Agent
    For the purposes of this section and in order to reduce the points of contact which the Federal Bureau of Investigation may have to maintain for purposes of subsection (a), the Conference of State Bank Supervisors or a wholly owned subsidiary may be used as a channeling agent of the States for requesting and distributing information between the Department of Justice and the appropriate State agencies.
12 USC Sec. 5111

Eff: 8/1/2009
Section 5111 - Confidentiality of information
  1. 12 USC Sec. 5111(a)
    System confidentiality
    Except as otherwise provided in this section, any requirement under Federal or State law regarding the privacy or confidentiality of any information or material provided to the Nationwide Mortgage Licensing System and Registry or a system established by the Director under section 5108 of this title, and any privilege arising under Federal or State law (including the rules of any Federal or State court) with respect to such information or material, shall continue to apply to such information or material after the information or material has been disclosed to the system. Such information and material may be shared with all State and Federal regulatory officials with mortgage industry oversight authority without the loss of privilege or the loss of confidentiality protections provided by Federal and State laws.
  2. 12 USC Sec. 5111(b)
    Nonapplicability of certain requirements
    Information or material that is subject to a privilege or confidentiality under subsection (a) shall not be subject to -
    1. 12 USC Sec. 5111(b)(1)
      disclosure under any Federal or State law governing the disclosure to the public of information held by an officer or an agency of the Federal Government or the respective State; or
    2. 12 USC Sec. 5111(b)(2)
      subpoena or discovery, or admission into evidence, in any private civil action or administrative process, unless with respect to any privilege held by the Nationwide Mortgage Licensing System and Registry or the Director with respect to such information or material, the person to whom such information or material pertains waives, in whole or in part, in the discretion of such person, that privilege.
  3. 12 USC Sec. 5111(c)
    Coordination with other law
    Any State law, including any State open record law, relating to the disclosure of confidential supervisory information or any information or material described in subsection (a) that is inconsistent with subsection (a) shall be superseded by the requirements of such provision to the extent State law provides less confidentiality or a weaker privilege.
  4. 12 USC Sec. 5111(d)
    Public access to information
    This section shall not apply with respect to the information or material relating to the employment history of, and publicly adjudicated disciplinary and enforcement actions against, loan originators that is included in Nationwide Mortgage Licensing System and Registry for access by the public.
12 USC Sec. 5112

Eff: 8/1/2009
Section 5112 - Liability provisions
12 USC Sec. 5113

Eff: 8/1/2009
Section 5113 - Enforcement by the Bureau
  1. 12 USC Sec. 5113(a)
    Summons authority
    The Director may -
    1. 12 USC Sec. 5113(a)(1)
      examine any books, papers, records, or other data of any loan originator operating in any State which is subject to a licensing system established by the Director under section 5107 of this title; and
    2. 12 USC Sec. 5113(a)(2)
      summon any loan originator referred to in paragraph (1) or any person having possession, custody, or care of the reports and records relating to such loan originator, to appear before the Director or any delegate of the Director at a time and place named in the summons and to produce such books, papers, records, or other data, and to give testimony, under oath, as may be relevant or material to an investigation of such loan originator for compliance with the requirements of this chapter.
  2. 12 USC Sec. 5113(b)
    Examination authority
    1. 12 USC Sec. 5113(b)(1)
      In general
      If the Director establishes a licensing system under section 5107 of this title for any State, the Director shall appoint examiners for the purposes of administering such section.
    2. 12 USC Sec. 5113(b)(2)
      Power to examine
      Any examiner appointed under paragraph (1) shall have power, on behalf of the Director, to make any examination of any loan originator operating in any State which is subject to a licensing system established by the Director under section 5107 of this title whenever the Director determines an examination of any loan originator is necessary to determine the compliance by the originator with this chapter.
    3. 12 USC Sec. 5113(b)(3)
      Report of examination
      Each examiner appointed under paragraph (1) shall make a full and detailed report of examination of any loan originator examined to the Director.
    4. 12 USC Sec. 5113(b)(4)
      Administration of oaths and affirmations; evidence
      In connection with examinations of loan originators operating in any State which is subject to a licensing system established by the Director under section 5107 of this title, or with other types of investigations to determine compliance with applicable law and regulations, the Director and examiners appointed by the Director may administer oaths and affirmations and examine and take and preserve testimony under oath as to any matter in respect to the affairs of any such loan originator.
    5. 12 USC Sec. 5113(b)(5)
      Assessments
      The cost of conducting any examination of any loan originator operating in any State which is subject to a licensing system established by the Director under section 5107 of this title shall be assessed by the Director against the loan originator to meet the Secretary's (!1) expenses in carrying out such examination.
  3. 12 USC Sec. 5113(c)
    Cease and desist proceeding
    1. 12 USC Sec. 5113(c)(1)
      Authority of Director
      If the Director finds, after notice and opportunity for hearing, that any person is violating, has violated, or is about to violate any provision of this chapter, or any regulation thereunder, with respect to a State which is subject to a licensing system established by the Director under section 5107 of this title, the Director may publish such findings and enter an order requiring such person, and any other person that is, was, or would be a cause of the violation, due to an act or omission the person knew or should have known would contribute to such violation, to cease and desist from committing or causing such violation and any future violation of the same provision, rule, or regulation. Such order may, in addition to requiring a person to cease and desist from committing or causing a violation, require such person to comply, or to take steps to effect compliance, with such provision or regulation, upon such terms and conditions and within such time as the Director may specify in such order. Any such order may, as the Director deems appropriate, require future compliance or steps to effect future compliance, either permanently or for such period of time as the Director may specify, with such provision or regulation with respect to any loan originator.
    2. 12 USC Sec. 5113(c)(2)
      Hearing
      The notice instituting proceedings pursuant to paragraph (1) shall fix a hearing date not earlier than 30 days nor later than 60 days after service of the notice unless an earlier or a later date is set by the Director with the consent of any respondent so served.
    3. 12 USC Sec. 5113(c)(3)
      Temporary order
      Whenever the Director determines that the alleged violation or threatened violation specified in the notice instituting proceedings pursuant to paragraph (1), or the continuation thereof, is likely to result in significant dissipation or conversion of assets, significant harm to consumers, or substantial harm to the public interest prior to the completion of the proceedings, the Director may enter a temporary order requiring the respondent to cease and desist from the violation or threatened violation and to take such action to prevent the violation or threatened violation and to prevent dissipation or conversion of assets, significant harm to consumers, or substantial harm to the public interest as the Director deems appropriate pending completion of such proceedings. Such an order shall be entered only after notice and opportunity for a hearing, unless the Director determines that notice and hearing prior to entry would be impracticable or contrary to the public interest. A temporary order shall become effective upon service upon the respondent and, unless set aside, limited, or suspended by the Director or a court of competent jurisdiction, shall remain effective and enforceable pending the completion of the proceedings.
    4. 12 USC Sec. 5113(c)(4)
      Review of temporary orders
      1. 12 USC Sec. 5113(c)(4)(A)
        Review by Director
        At any time after the respondent has been served with a temporary cease and desist order pursuant to paragraph (3), the respondent may apply to the Director to have the order set aside, limited, or suspended. If the respondent has been served with a temporary cease and desist order entered without a prior hearing before the Director, the respondent may, within 10 days after the date on which the order was served, request a hearing on such application and the Director shall hold a hearing and render a decision on such application at the earliest possible time.
      2. 12 USC Sec. 5113(c)(4)(B)
        Judicial review
        Within -
        1. 12 USC Sec. 5113(c)(4)(B)(i)
          10 days after the date the respondent was served with a temporary cease and desist order entered with a prior hearing before the Director; or
        2. 12 USC Sec. 5113(c)(4)(B)(ii)
          10 days after the Director renders a decision on an application and hearing under paragraph (1), with respect to any temporary cease and desist order entered without a prior hearing before the Director,
      3. 12 USC Sec. 5113(c)(4)(B)
        the respondent may apply to the United States district court for the district in which the respondent resides or has its principal place of business, or for the District of Columbia, for an order setting aside, limiting, or suspending the effectiveness or enforcement of the order, and the court shall have jurisdiction to enter such an order. A respondent served with a temporary cease and desist order entered without a prior hearing before the Director may not apply to the court except after hearing and decision by the Director on the respondent's application under subparagraph (A).
      4. 12 USC Sec. 5113(c)(4)(C)
        No automatic stay of temporary order
        The commencement of proceedings under subparagraph (B) shall not, unless specifically ordered by the court, operate as a stay of the Secretary's order.
    5. 12 USC Sec. 5113(c)(5)
      Authority of the Director to prohibit persons from serving as loan originators
      In any cease and desist proceeding under paragraph (1), the Director may issue an order to prohibit, conditionally or unconditionally, and permanently or for such period of time as the Director shall determine, any person who has violated this chapter or regulations thereunder, from acting as a loan originator if the conduct of that person demonstrates unfitness to serve as a loan originator.
  4. 12 USC Sec. 5113(d)
    Authority of the Director to assess money penalties
    1. 12 USC Sec. 5113(d)(1)
      In general
      The Director may impose a civil penalty on a loan originator operating in any State which is subject to a licensing system established by the Director under section 5107 of this title, if the Director finds, on the record after notice and opportunity for hearing, that such loan originator has violated or failed to comply with any requirement of this chapter or any regulation prescribed by the Director under this chapter or order issued under subsection (c).
    2. 12 USC Sec. 5113(d)(2)
      Maximum amount of penalty
      The maximum amount of penalty for each act or omission described in paragraph (1) shall be $25,000.
12 USC Sec. 5114

Eff: 8/1/2009
Section 5114 - State examination authority
12 USC Sec. 5115

Eff: 8/1/2009
Section 5115 - Reports and recommendations to Congress
  1. 12 USC Sec. 5115(a)
    Annual reports
    Not later than 1 year after July 30, 2008, and annually thereafter, the Director shall submit a report to Congress on the effectiveness of the provisions of this chapter, including legislative recommendations, if any, for strengthening consumer protections, enhancing examination standards, streamlining communication between all stakeholders involved in residential mortgage loan origination and processing, and establishing performance based bonding requirements for mortgage originators or institutions that employ such brokers.
  2. 12 USC Sec. 5115(b)
    Legislative recommendations
    Not later than 6 months after July 30, 2008, the Director shall make recommendations to Congress on legislative reforms to the Real Estate Settlement Procedures Act of 1974 [12 U.S.C. 2601 et seq.], that the Director deems appropriate to promote more transparent disclosures, allowing consumers to better shop and compare mortgage loan terms and settlement costs.
12 USC Sec. 5116

Eff: 8/1/2009
Section 5116 - Study and reports on defaults and foreclosures
  1. 12 USC Sec. 5116(a)
    Study required
    The Director shall conduct an extensive study of the root causes of default and foreclosure of home loans, using as much empirical data as is available.
  2. 12 USC Sec. 5116(b)
    Preliminary report to Congress
    Not later than 6 months after July 30, 2008, the Director shall submit to Congress a preliminary report regarding the study required by this section.
  3. 12 USC Sec. 5116(c)
    Final report to Congress
    Not later than 12 months after July 30, 2008, the Director shall submit to Congress a final report regarding the results of the study required by this section, which shall include any recommended legislation relating to the study, and recommendations for best practices and for a process to provide targeted assistance to populations with the highest risk of potential default or foreclosure.
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