USA Statutes : nevada
Title : Title 54 - PROFESSIONS, OCCUPATIONS AND BUSINESSES
Chapter : CHAPTER 645E - MORTGAGE BANKERS
As used in this chapter, unless the
context otherwise requires, the words and terms defined in NRS 645E.020
to 645E.100 , inclusive, have the meanings ascribed to
them in those sections.
(Added to NRS by 1999, 3744 )
“Applicant” means a person who
applies for licensure as a mortgage banker pursuant to this chapter.
(Added to NRS by 1999, 3744 ; A 2003, 3558 )
“Commercial
mortgage loan” means a loan that:
1. Directly or indirectly, is secured by a lien on commercial
property; and
2. Is created with the consent of the owner of the commercial
property.
(Added to NRS by 1999, 3744 )
“Commercial property”
means any real property which is located in this state and which is not
used for a residential dwelling or dwellings intended for occupancy by
four or fewer families.
(Added to NRS by 1999, 3744 )
“Commissioner” means the
Commissioner of Mortgage Lending.
(Added to NRS by 1999, 3744 ; A 2003, 3558 )
“Depository financial institution” means a bank, savings and loan
association, thrift company or credit union.
(Added to NRS by 1999, 3744 )
“Division” means the Division of
Mortgage Lending of the Department of Business and Industry.
(Added to NRS by 1999, 3744 ; A 2003, 3558 )
“Institutional
investor” means a person who, in the regular course of business, makes
commercial mortgage loans of more than $250,000 that are funded
exclusively from one or more of the following sources:
1. The person’s cash, corporate capital or warehouse credit lines
at a depository financial institution or other sources that are liability
items on the person’s financial statements.
2. Correspondent contracts between the person and another
institutional investor or between the person and a depository financial
institution, trust company, profit-sharing or pension trust, installment
lender or insurance company.
3. An affiliate’s cash, corporate capital or warehouse credit
lines at a depository financial institution or other sources that are
liability items on the affiliate’s financial statements for which the
affiliate’s assets are pledged. As used in this subsection, “affiliate”
means another person who, directly or indirectly through one or more
intermediaries, controls, is controlled by or is under common control
with the person who is the institutional investor.
(Added to NRS by 1999, 3745 )
“Licensee” means a person who is
licensed as a mortgage banker pursuant to this chapter.
(Added to NRS by 1999, 3745 ; A 2003, 3558 )
1. “Mortgage banker” means any of the following:
(a) A person who, directly or indirectly:
(1) Holds himself out as being able to:
(I) Buy or sell notes secured by liens on real
property; or
(II) Make loans secured by liens on real property
using his own money; and
(2) Does not engage in any other act or transaction
described in the definition of “mortgage broker,” as set forth in NRS
645B.0127 , unless the person is also
licensed as a mortgage broker pursuant to chapter 645B of NRS.
(b) A person who, directly or indirectly:
(1) Negotiates, originates or makes or offers to negotiate,
originate or make commercial mortgage loans as an agent for or on behalf
of an institutional investor; and
(2) Does not engage in any other act or transaction
described in the definition of “mortgage broker,” as set forth in NRS
645B.0127 , unless the person is also
licensed as a mortgage broker pursuant to chapter 645B of NRS.
2. For the purposes of this section, a person does not make a loan
secured by a lien on real property using his own money if any portion of
the money that is used to make the loan is provided by another person who
acquires ownership of or a beneficial interest in the loan.
(Added to NRS by 1999, 3745 ; A 2003, 3558 )
The provisions of this chapter do not:
1. Limit any statutory or common-law right of a person to bring a
civil action against a mortgage banker for any act or omission involved
in the transaction of business by or on behalf of the mortgage banker;
2. Limit the right of the State to punish a person for the
violation of any law, ordinance or regulation; or
3. Establish a basis for a person to bring a civil action against
the State or its officers or employees for any act or omission in
carrying out the provisions of this chapter, including, without
limitation, any act or omission relating to the disclosure of information
or the failure to disclose information pursuant to the provisions of this
chapter.
(Added to NRS by 1999, 3745 ; A 2003, 3558 )
EXEMPTIONS
Except
as otherwise provided in NRS 645E.160 , the provisions of this chapter do not apply
to:
1. Any person doing business under the laws of this State, any
other state or the United States relating to banks, savings banks, trust
companies, savings and loan associations, consumer finance companies,
industrial loan companies, credit unions, thrift companies or insurance
companies, unless the business conducted in this State is not subject to
supervision by the regulatory authority of the other jurisdiction, in
which case licensing pursuant to this chapter is required.
2. A real estate investment trust, as defined in 26 U.S.C. § 856,
unless the business conducted in this State is not subject to supervision
by the regulatory authority of the other jurisdiction, in which case
licensing pursuant to this chapter is required.
3. An employee benefit plan, as defined in 29 U.S.C. § 1002(3), if
the loan is made directly from money in the plan by the plan’s trustee.
4. An attorney at law rendering services in the performance of his
duties as an attorney at law.
5. A real estate broker rendering services in the performance of
his duties as a real estate broker.
6. Any person doing any act under an order of any court.
7. Any one natural person, or husband and wife, who provides money
for investment in loans secured by a lien on real property, on his own
account, unless such a person makes a loan secured by a lien on real
property using his own money and assigns all or a part of his interest in
the loan to another person, other than his spouse or child, within 5
years after the date on which the loan is made or the deed of trust is
recorded, whichever occurs later.
8. Agencies of the United States and of this State and its
political subdivisions, including the Public Employees’ Retirement System.
9. A seller of real property who offers credit secured by a
mortgage of the property sold.
(Added to NRS by 1999, 3746 ; A 2003, 3559 )
1. A person who claims an exemption from the provisions of this
chapter pursuant to subsection 1 of NRS 645E.150 must:
(a) File a written application for a certificate of exemption with
the Office of the Commissioner;
(b) Pay the fee required pursuant to NRS 645E.280 ; and
(c) Include with the written application satisfactory proof that
the person meets the requirements of subsection 1 of NRS 645E.150 .
2. The Commissioner may require a person who claims an exemption
from the provisions of this chapter pursuant to subsections 2 to 9,
inclusive, of NRS 645E.150 to:
(a) File a written application for a certificate of exemption with
the Office of the Commissioner;
(b) Pay the fee required pursuant to NRS 645E.280 ; and
(c) Include with the written application satisfactory proof that
the person meets the requirements of at least one of those exemptions.
3. A certificate of exemption expires automatically if, at any
time, the person who claims the exemption no longer meets the
requirements of at least one exemption set forth in the provisions of NRS
645E.150 .
4. If a certificate of exemption expires automatically pursuant to
this section, the person shall not provide any of the services of a
mortgage banker or otherwise engage in, carry on or hold himself out as
engaging in or carrying on the business of a mortgage banker unless the
person applies for and is issued:
(a) A license as a mortgage banker pursuant to this chapter; or
(b) Another certificate of exemption.
5. The Commissioner may impose upon a person who is required to
apply for a certificate of exemption or who holds a certificate of
exemption an administrative fine of not more than $10,000 for each
violation that he commits, if the person:
(a) Has knowingly made or caused to be made to the Commissioner any
false representation of material fact;
(b) Has suppressed or withheld from the Commissioner any
information which the person possesses and which, if submitted by him,
would have rendered the person ineligible to hold a certificate of
exemption; or
(c) Has violated any provision of this chapter, a regulation
adopted pursuant to this chapter or an order of the Commissioner that
applies to a person who is required to apply for a certificate of
exemption or who holds a certificate of exemption.
(Added to NRS by 1999, 3746 ; A 2003, 3559 )
1. A person may apply to the Commissioner for an exemption from
the provisions of this chapter governing the making of a loan of money.
2. The Commissioner may grant the exemption if he finds that:
(a) The making of the loan would not be detrimental to the
financial condition of the lender or the debtor;
(b) The lender or the debtor has established a record of sound
performance, efficient management, financial responsibility and integrity;
(c) The making of the loan is likely to increase the availability
of capital for a sector of the state economy; and
(d) The making of the loan is not detrimental to the public
interest.
3. The Commissioner:
(a) May revoke an exemption unless the loan for which the exemption
was granted has been made; and
(b) Shall issue a written statement setting forth the reasons for
his decision to grant, deny or revoke an exemption.
(Added to NRS by 1999, 3747 )
LICENSING
1. A person who wishes to be licensed as a mortgage banker must
file a written application for a license with the Office of the
Commissioner and pay the fee required pursuant to NRS 645E.280 . An application for a license as a mortgage
banker must:
(a) Be verified.
(b) State the name, residence address and business address of the
applicant and the location of each principal office and branch office at
which the mortgage banker will conduct business in this state, including,
without limitation, any office or other place of business located outside
this state from which the mortgage banker will conduct business in this
state.
(c) State the name under which the applicant will conduct business
as a mortgage banker.
(d) If the applicant is not a natural person, list the name,
residence address and business address of each person who will have an
interest in the mortgage banker as a principal, partner, officer,
director or trustee, specifying the capacity and title of each such
person.
(e) Indicate the general plan and character of the business.
(f) State the length of time the applicant has been engaged in the
business of a mortgage banker.
(g) Include a financial statement of the applicant.
(h) Include any other information required pursuant to the
regulations adopted by the Commissioner or an order of the Commissioner.
2. If a mortgage banker will conduct business in this state at one
or more branch offices, the mortgage banker must apply for a license for
each such branch office.
3. Except as otherwise provided in this chapter, the Commissioner
shall issue a license to an applicant as a mortgage banker if:
(a) The application complies with the requirements of this chapter;
and
(b) The applicant and each general partner, officer or director of
the applicant, if the applicant is a partnership, corporation or
unincorporated association:
(1) Has a good reputation for honesty, trustworthiness and
integrity and displays competence to transact the business of a mortgage
banker in a manner which safeguards the interests of the general public.
The applicant must submit satisfactory proof of these qualifications to
the Commissioner.
(2) Has not been convicted of, or entered a plea of nolo
contendere to, a felony relating to the practice of mortgage bankers or
any crime involving fraud, misrepresentation or moral turpitude.
(3) Has not made a false statement of material fact on his
application.
(4) Has not had a license that was issued pursuant to the
provisions of this chapter or chapter 645B
of NRS suspended or revoked within the 10 years immediately preceding the
date of his application.
(5) Has not had a license that was issued in any other
state, district or territory of the United States or any foreign country
suspended or revoked within the 10 years immediately preceding the date
of his application.
(6) Has not violated any provision of this chapter or
chapter 645B of NRS, a regulation adopted
pursuant thereto or an order of the Commissioner.
4. If an applicant is a partnership, corporation or unincorporated
association, the Commissioner may refuse to issue a license to the
applicant if any member of the partnership or any officer or director of
the corporation or unincorporated association has committed any act or
omission that would be cause for refusing to issue a license to a natural
person.
5. A person may apply for a license for an office or other place
of business located outside this state from which the applicant will
conduct business in this state if the applicant or a subsidiary or
affiliate of the applicant has a license issued pursuant to this chapter
for an office or other place of business located in this state and if the
applicant submits with the application for a license a statement signed
by the applicant which states that the applicant agrees to:
(a) Make available at a location within this state the books,
accounts, papers, records and files of the office or place of business
located outside this state to the Commissioner or a representative of the
Commissioner; or
(b) Pay the reasonable expenses for travel, meals and lodging of
the Commissioner or a representative of the Commissioner incurred during
any investigation or examination made at the office or place of business
located outside this state.
Ê The applicant must be allowed to choose between paragraph (a) or (b) in
complying with the provisions of this subsection.
(Added to NRS by 1999, 3748 ; A 2001, 2045 ; 2003, 2726 , 3560 )
[Effective until the date of the repeal of the federal law
requiring each state to establish procedures for withholding, suspending
and restricting the professional, occupational and recreational licenses
for child support arrearages and for noncompliance with certain processes
relating to paternity or child support proceedings.]
1. In addition to any other requirements set forth in this chapter:
(a) A natural person who applies for the issuance of a license as a
mortgage banker shall include the social security number of the applicant
in the application submitted to the Commissioner.
(b) A natural person who applies for the issuance or renewal of a
license as a mortgage banker shall submit to the Commissioner the
statement prescribed by the Division of Welfare and Supportive Services
of the Department of Health and Human Services pursuant to NRS 425.520
. The statement must be completed and
signed by the applicant.
2. The Commissioner shall include the statement required pursuant
to subsection 1 in:
(a) The application or any other forms that must be submitted for
the issuance or renewal of the license; or
(b) A separate form prescribed by the Commissioner.
3. The Commissioner shall not issue or renew a license as a
mortgage banker if the applicant is a natural person who:
(a) Fails to submit the statement required pursuant to subsection
1; or
(b) Indicates on the statement submitted pursuant to subsection 1
that he is subject to a court order for the support of a child and is not
in compliance with the order or a plan approved by the district attorney
or other public agency enforcing the order for the repayment of the
amount owed pursuant to the order.
4. If an applicant indicates on the statement submitted pursuant
to subsection 1 that he is subject to a court order for the support of a
child and is not in compliance with the order or a plan approved by the
district attorney or other public agency enforcing the order for the
repayment of the amount owed pursuant to the order, the Commissioner
shall advise the applicant to contact the district attorney or other
public agency enforcing the order to determine the actions that the
applicant may take to satisfy the arrearage.
(Added to NRS by 1999, 3750 ; A 2003, 3562 ; 2005, 2791 , 2810 , 2817 )
[Effective on the date of the repeal of the federal law
requiring each state to establish procedures for withholding, suspending
and restricting the professional, occupational and recreational licenses
for child support arrearages and for noncompliance with certain processes
relating to paternity or child support proceedings and expires by
limitation 2 years after that date.]
1. In addition to any other requirements set forth in this
chapter, a natural person who applies for the issuance or renewal of a
license as a mortgage banker shall submit to the Commissioner the
statement prescribed by the Division of Welfare and Supportive Services
of the Department of Health and Human Services pursuant to NRS 425.520
. The statement must be completed and
signed by the applicant.
2. The Commissioner shall include the statement required pursuant
to subsection 1 in:
(a) The application or any other forms that must be submitted for
the issuance or renewal of the license; or
(b) A separate form prescribed by the Commissioner.
3. The Commissioner shall not issue or renew a license as a
mortgage banker if the applicant is a natural person who:
(a) Fails to submit the statement required pursuant to subsection
1; or
(b) Indicates on the statement submitted pursuant to subsection 1
that he is subject to a court order for the support of a child and is not
in compliance with the order or a plan approved by the district attorney
or other public agency enforcing the order for the repayment of the
amount owed pursuant to the order.
4. If an applicant indicates on the statement submitted pursuant
to subsection 1 that he is subject to a court order for the support of a
child and is not in compliance with the order or a plan approved by the
district attorney or other public agency enforcing the order for the
repayment of the amount owed pursuant to the order, the Commissioner
shall advise the applicant to contact the district attorney or other
public agency enforcing the order to determine the actions that the
applicant may take to satisfy the arrearage.
(Added to NRS by 1999, 3750 ; A 2003, 3562 ; 2005, 2791 , 2810 , 2817 , effective on the date of the repeal of
the federal law requiring each state to establish procedures for
withholding, suspending and restricting the professional, occupational
and recreational licenses for child support arrearages and for
noncompliance with certain processes relating to paternity or child
support proceedings)
1. A mortgage banker shall post each license in a conspicuous
place in the office for which the license has been issued.
2. A mortgage banker may not transfer or assign a license to
another person, unless the Commissioner gives his written approval.
(Added to NRS by 1999, 3751 ; A 2003, 3562 )
1. A license entitles a licensee to engage only in the activities
authorized by this chapter.
2. The provisions of this chapter do not prohibit a licensee from:
(a) Holding a license as a mortgage broker pursuant to chapter 645B
of NRS; or
(b) Conducting the business of a mortgage banker and the business
of a mortgage broker in the same office or place of business.
(Added to NRS by 1999, 3750 ; A 2003, 3562 )
EXPIRATION AND RENEWAL OF LICENSE OR CERTIFICATE OF EXEMPTION; FEES
1. A license issued to a mortgage banker pursuant to this chapter
expires each year on December 31, unless it is renewed. To renew a
license, the licensee must submit to the Commissioner on or before
December 31 of each year:
(a) An application for renewal that complies with the requirements
of this chapter; and
(b) The fee required to renew the license pursuant to this section.
2. If the licensee fails to submit any item required pursuant to
subsection 1 to the Commissioner on or before December 31 of any year,
the license is cancelled. The Commissioner may reinstate a cancelled
license if the licensee submits to the Commissioner:
(a) An application for renewal that complies with the requirements
of this chapter;
(b) The fee required to renew the license pursuant to this section;
and
(c) A reinstatement fee of $200.
3. Except as otherwise provided in NRS 645E.160 , a certificate of exemption issued pursuant
to this chapter expires each year on December 31, unless it is renewed.
To renew a certificate of exemption, a person must submit to the
Commissioner on or before December 31 of each year:
(a) An application for renewal that complies with the requirements
of this chapter; and
(b) The fee required to renew the certificate of exemption.
4. If the person fails to submit any item required pursuant to
subsection 3 to the Commissioner on or before December 31 of any year,
the certificate of exemption is cancelled. Except as otherwise provided
in NRS 645E.160 , the Commissioner may
reinstate a cancelled certificate of exemption if the person submits to
the Commissioner:
(a) An application for renewal that complies with the requirements
of this chapter;
(b) The fee required to renew the certificate of exemption; and
(c) A reinstatement fee of $100.
5. A person must pay the following fees to apply for, to be issued
or to renew a license as a mortgage banker pursuant to this chapter:
(a) To file an original application for a license, $1,500 for the
principal office and $40 for each branch office. The person must also pay
such additional expenses incurred in the process of investigation as the
Commissioner deems necessary.
(b) To be issued a license, $1,000 for the principal office and $60
for each branch office.
(c) To renew a license, $500 for the principal office and $100 for
each branch office.
6. A person must pay the following fees to apply for or to renew a
certificate of exemption pursuant to this chapter:
(a) To file an application for a certificate of exemption, $200.
(b) To renew a certificate of exemption, $100.
7. To be issued a duplicate copy of any license or certificate of
exemption, a person must make a satisfactory showing of its loss and pay
a fee of $10.
8. Except as otherwise provided in this chapter, all fees received
pursuant to this chapter must be deposited in the Fund for Mortgage
Lending created by NRS 645F.270 .
(Added to NRS by 1999, 3749 ; A 2003, 3230 , 3562 ; 2003, 20th Special Session, 265 )
SUPERVISION BY COMMISSIONER
General Provisions
1. Subject to the administrative control of the Director of the
Department of Business and Industry, the Commissioner shall exercise
general supervision and control over mortgage bankers doing business in
this State.
2. In addition to the other duties imposed upon him by law, the
Commissioner shall:
(a) Adopt any regulations that are necessary to carry out the
provisions of this chapter, except as to loan fees.
(b) Conduct such investigations as may be necessary to determine
whether any person has violated any provision of this chapter, a
regulation adopted pursuant to this chapter or an order of the
Commissioner.
(c) Conduct an annual examination of each mortgage banker doing
business in this State.
(d) Conduct such other examinations, periodic or special audits,
investigations and hearings as may be necessary and proper for the
efficient administration of the laws of this State regarding mortgage
bankers.
(e) Classify as confidential certain records and information
obtained by the Division when those matters are obtained from a
governmental agency upon the express condition that they remain
confidential. This paragraph does not limit examination by:
(1) The Legislative Auditor; or
(2) The Department of Taxation if necessary to carry out the
provisions of chapter 363A of NRS.
(f) Conduct such examinations and investigations as are necessary
to ensure that mortgage bankers meet the requirements of this chapter for
obtaining a license, both at the time of the application for a license
and thereafter on a continuing basis.
3. For each special audit, investigation or examination, a
mortgage banker shall pay a fee based on the rate established pursuant to
NRS 645F.280 .
(Added to NRS by 1999, 3751 ; A 2003, 3564 ; 2003, 20th Special Session, 223 )
1. In the conduct of any examination, periodic or special audit,
investigation or hearing, the Commissioner may:
(a) Compel the attendance of any person by subpoena.
(b) Administer oaths.
(c) Examine any person under oath concerning the business and
conduct of affairs of any person subject to the provisions of this
chapter and, in connection therewith, require the production of any
books, records or papers relevant to the inquiry.
2. Any person subpoenaed under the provisions of this section who
willfully refuses or willfully neglects to appear at the time and place
named in the subpoena or to produce books, records or papers required by
the Commissioner, or who refuses to be sworn or answer as a witness, is
guilty of a misdemeanor.
3. In addition to the authority to recover attorney’s fees and
costs pursuant to any other statute, the Commissioner may assess against
and collect from a person all costs, including, without limitation,
reasonable attorney’s fees, that are attributable to any examination,
periodic or special audit, investigation or hearing that is conducted to
examine or investigate the conduct, activities or business of the person
pursuant to this chapter.
(Added to NRS by 1999, 3752 ; A 2003, 3473 )
1. A licensee who wishes to change the address of an office or
other place of business for which he has a license pursuant to this
chapter must, at least 10 days before changing the address, give written
notice of the proposed change to the Commissioner.
2. Upon receipt of the proposed change of address pursuant to
subsection 1, the commissioner shall provide written approval of the
change and the date of the approval.
3. If a licensee fails to provide notice as required pursuant to
subsection 1, the Commissioner may impose an administrative fine in an
amount not to exceed $500.
(Added to NRS by 2001, 2044 )
Each mortgage banker shall pay the assessment levied pursuant to NRS
645F.180 and cooperate fully with the
audits and examinations performed pursuant thereto.
(Added to NRS by 1999, 3752 ; A 2003, 3564 )
Records and Financial Statements
1. Each mortgage banker shall keep and maintain at all times at
each location where the mortgage banker conducts business in this state
complete and suitable records of all mortgage transactions made by the
mortgage banker at that location. Each mortgage banker shall also keep
and maintain at all times at each such location all original books,
papers and data, or copies thereof, clearly reflecting the financial
condition of the business of the mortgage banker.
2. Each mortgage banker shall submit to the Commissioner each
month a report of the mortgage banker’s activity for the previous month.
The report must:
(a) Specify the volume of loans made by the mortgage banker for the
month or state that no loans were made in that month;
(b) Include any information required pursuant to the regulations
adopted by the Commissioner; and
(c) Be submitted to the Commissioner by the 15th day of the month
following the month for which the report is made.
3. The Commissioner may adopt regulations prescribing accounting
procedures for mortgage bankers handling trust accounts and the
requirements for keeping records relating to such accounts.
4. A licensee who operates outside this state an office or other
place of business which is licensed pursuant to this chapter shall:
(a) Make available at a location within this state the books,
accounts, papers, records and files of the office or place of business
located outside this state to the Commissioner or a representative of the
Commissioner; or
(b) Pay the reasonable expenses for travel, meals and lodging of
the Commissioner or a representative of the Commissioner incurred during
any investigation or examination made at the office or place of business
located outside this state.
Ê The licensee must be allowed to choose between paragraph (a) or (b) in
complying with the provisions of this subsection.
(Added to NRS by 1999, 3752 ; A 2001, 2046 ; 2003, 3564 )
1. Except as otherwise provided in this section, not later than 60
days after the last day of each fiscal year for a mortgage banker, the
mortgage banker shall submit to the Commissioner a financial statement
that:
(a) Is dated not earlier than the last day of the fiscal year; and
(b) Has been prepared from the books and records of the mortgage
banker by an independent public accountant who holds a permit to engage
in the practice of public accounting in this State that has not been
revoked or suspended.
2. The Commissioner may grant a reasonable extension for the
submission of a financial statement pursuant to this section if a
mortgage banker requests such an extension before the date on which the
financial statement is due.
3. If a mortgage banker maintains any accounts described in NRS
645E.430 , the financial statement
submitted pursuant to this section must be audited. The public accountant
who prepares the report of an audit shall submit a copy of the report to
the Commissioner at the same time that he submits the report to the
mortgage banker.
4. The Commissioner shall adopt regulations prescribing the scope
of an audit conducted pursuant to subsection 3.
(Added to NRS by 1999, 3753 ; A 2003, 3565 )
1. Except as otherwise provided in this section or by specific
statute, all papers, documents, reports and other written instruments
filed with the Commissioner pursuant to this chapter are open to public
inspection.
2. The Commissioner may withhold from public inspection or refuse
to disclose to a person, for such time as the Commissioner considers
necessary, any information that, in his judgment, would:
(a) Impede or otherwise interfere with an investigation that is
currently pending against a mortgage banker; or
(b) Have an undesirable effect on the welfare of the public or the
welfare of any mortgage banker.
(Added to NRS by 1999, 3753 ; A 2003, 3565 )
1. Except as otherwise provided in this section, a complaint filed
with the Commissioner, all documents and other information filed with the
complaint and all documents and other information compiled as a result of
an investigation conducted to determine whether to initiate disciplinary
action are confidential.
2. The complaint or other document filed by the Commissioner to
initiate disciplinary action and all documents and information considered
by the Commissioner when determining whether to impose discipline are
public records.
(Added to NRS by 2003, 3472 )
Transfer of Stock
1. The Commissioner must be notified of a transfer of 5 percent or
more of the outstanding voting stock of a mortgage banker and must
approve a transfer of voting stock of a mortgage banker which constitutes
a change of control.
2. The person who acquires stock resulting in a change of control
of the mortgage banker shall apply to the Commissioner for approval of
the transfer. The application must contain information which shows that
the requirements of this chapter for obtaining a license will be
satisfied after the change of control. Except as otherwise provided in
subsection 3, the Commissioner shall conduct an investigation to
determine whether those requirements will be satisfied. If, after the
investigation, the Commissioner denies the application, he may forbid the
applicant from participating in the business of the mortgage banker.
3. A mortgage banker may submit a written request to the
Commissioner to waive an investigation pursuant to subsection 2. The
Commissioner may grant a waiver if the applicant has undergone a similar
investigation by a state or federal agency in connection with the
licensing of or his employment with a financial institution.
4. As used in this section, “change of control” means:
(a) A transfer of voting stock which results in giving a person,
directly or indirectly, the power to direct the management and policy of
a mortgage banker; or
(b) A transfer of at least 25 percent of the outstanding voting
stock of a mortgage banker.
(Added to NRS by 1999, 3751 ; A 2003, 3565 )
ESCROW AND TRUST ACCOUNTS
1. Except as otherwise provided in subsection 3, the amount of any
advance fee, salary, deposit or money paid to any mortgage banker or
other person to obtain a loan secured by a lien on real property must be
placed in escrow pending completion of the loan or a commitment for the
loan.
2. The amount held in escrow pursuant to subsection 1 must be
released:
(a) Upon completion of the loan or commitment for the loan, to the
mortgage banker or other person to whom the advance fee, salary, deposit
or money was paid.
(b) If the loan or commitment for the loan fails, to the person who
made the payment.
3. Advance payments to cover reasonably estimated costs paid to
third persons are excluded from the provisions of subsections 1 and 2 if
the person making them first signs a written agreement which specifies
the estimated costs by item and the estimated aggregate cost, and which
recites that money advanced for costs will not be refunded. If an
itemized service is not performed and the estimated cost thereof is not
refunded, the recipient of the advance payment is subject to the
penalties provided in NRS 645E.960 .
(Added to NRS by 1999, 3753 ; A 2003, 3566 )
1. All money paid to a mortgage banker for payment of taxes or
insurance premiums on real property which secures any loan made by the
mortgage banker must be deposited in an insured depository financial
institution and kept separate, distinct and apart from money belonging to
the mortgage banker. Such money, when deposited, is to be designated as
an “impound trust account” or under some other appropriate name
indicating that the accounts are not the money of the mortgage banker.
2. The mortgage banker has a fiduciary duty to each debtor with
respect to the money in an impound trust account.
3. The mortgage banker shall, upon reasonable notice, account to
any debtor whose real property secures a loan made by the mortgage banker
for any money which that person has paid to the mortgage banker for the
payment of taxes or insurance premiums on the real property.
4. The mortgage banker shall, upon reasonable notice, account to
the Commissioner for all money in an impound trust account.
5. A mortgage banker shall:
(a) Require contributions to an impound trust account in an amount
reasonably necessary to pay the obligations as they become due.
(b) Within 30 days after the completion of the annual review of an
impound trust account, notify the debtor:
(1) Of the amount by which the contributions exceed the
amount reasonably necessary to pay the annual obligations due from the
account; and
(2) That the debtor may specify the disposition of the
excess money within 20 days after receipt of the notice. If the debtor
fails to specify such a disposition within that time, the mortgage banker
shall maintain the excess money in the account.
Ê This subsection does not prohibit a mortgage banker from requiring
additional amounts to be paid into an impound trust account to recover a
deficiency that exists in the account.
6. A mortgage banker shall not make payments from an impound trust
account in a manner that causes a policy of insurance to be cancelled or
causes property taxes or similar payments to become delinquent.
(Added to NRS by 1999, 3754 ; A 2003, 3566 )
1. Money in an impound trust account is not subject to execution
or attachment on any claim against the mortgage banker.
2. It is unlawful for a mortgage banker knowingly to keep or cause
to be kept any money in a depository financial institution under the
heading of “impound trust account” or any other name designating such
money as belonging to the debtors of the mortgage banker, unless the
money has been paid to the mortgage banker by a debtor pursuant to NRS
645E.430 and is being held in trust
by the mortgage banker pursuant to the provisions of that section.
(Added to NRS by 1999, 3754 ; A 2003, 3567 )
LOAN PAYMENTS
1. If a person is required to make a payment to a mortgage banker
pursuant to the terms of a loan secured by a lien on real property, the
mortgage banker may not charge the person a late fee, an additional
amount of interest or any other penalty in connection with that payment
if the payment is delivered to the mortgage banker before 5 p.m. on:
(a) The day that the payment is due pursuant to the terms of the
loan, if an office of the mortgage banker is open to customers until 5
p.m. on that day; or
(b) The next day that an office of the mortgage banker is open to
customers until 5 p.m., if the provisions of paragraph (a) do not
otherwise apply.
2. A person and a mortgage banker may not agree to alter or waive
the provisions of this section by contract or other agreement, and any
such contract or agreement is void and must not be given effect to the
extent that it violates the provisions of this section.
(Added to NRS by 1999, 3755 ; A 2003, 3567 )
INVESTIGATION OF VIOLATIONS AND UNSAFE PRACTICES; REMEDIAL ACTION
1. Whether or not a complaint has been filed, the Commissioner may
investigate a mortgage banker or other person if, for any reason, it
appears that:
(a) The mortgage banker is conducting business in an unsafe and
injurious manner or in violation of any provision of this chapter, a
regulation adopted pursuant to this chapter or an order of the
Commissioner;
(b) The person is offering or providing any of the services of a
mortgage banker or otherwise engaging in, carrying on or holding himself
out as engaging in or carrying on the business of a mortgage banker
without being licensed or exempt from licensing pursuant to the
provisions of this chapter; or
(c) The person is violating any other provision of this chapter, a
regulation adopted pursuant to this chapter or an order of the
Commissioner.
2. If, upon investigation, the Commissioner has reasonable cause
to believe that the mortgage banker or other person has engaged in any
conduct or committed any violation described in subsection 1, the
Commissioner may:
(a) Advise the district attorney of the county in which the conduct
or violation occurred, and the district attorney shall cause the
appropriate legal action to be taken against the mortgage banker or other
person to enjoin the conduct or the operation of the business or
prosecute the violation; and
(b) Bring a civil action to:
(1) Enjoin the mortgage banker or other person from engaging
in the conduct, operating the business or committing the violation; and
(2) Enjoin any other person who has encouraged, facilitated,
aided or participated in the conduct, the operation of the business or
the commission of the violation, or who is likely to engage in such acts,
from engaging in or continuing to engage in such acts.
3. If the Commissioner brings a civil action pursuant to
subsection 2, the district court of any county of this state is hereby
vested with the jurisdiction in equity to enjoin the conduct, the
operation of the business or the commission of the violation and may
grant any injunctions that are necessary to prevent and restrain the
conduct, the operation of the business or the commission of the
violation. During the pendency of the proceedings before the district
court:
(a) The court may issue any temporary restraining orders as may
appear to be just and proper;
(b) The findings of the Commissioner shall be deemed to be prima
facie evidence and sufficient grounds, in the discretion of the court,
for the ex parte issuance of a temporary restraining order; and
(c) The Commissioner may apply for and on due showing is entitled
to have issued the court’s subpoena requiring forthwith the appearance of
any person to:
(1) Produce any documents, books and records as may appear
necessary for the hearing of the petition; and
(2) Testify and give evidence concerning the conduct
complained of in the petition.
(Added to NRS by 1999, 3755 ; A 2003, 3568 )
1. In addition to any other action that is permitted pursuant to
this chapter, if the Commissioner has reasonable cause to believe that:
(a) The assets or capital of a mortgage banker are impaired; or
(b) A mortgage banker is conducting business in an unsafe and
injurious manner that may result in danger to the public,
Ê the Commissioner may immediately take possession of all the property,
business and assets of the mortgage banker that are located in this state
and retain possession of them pending further proceedings provided for in
this chapter.
2. If the licensee, the board of directors or any officer or
person in charge of the offices of the mortgage banker refuses to permit
the Commissioner to take possession of the property of the mortgage
banker pursuant to subsection 1:
(a) The Commissioner shall notify the Attorney General; and
(b) The Attorney General shall immediately bring such proceedings
as may be necessary to place the Commissioner in immediate possession of
the property of the mortgage banker.
3. If the Commissioner takes possession of the property of the
mortgage banker, the Commissioner shall:
(a) Make or have made an inventory of the assets and known
liabilities of the mortgage banker; and
(b) File one copy of the inventory in his office and one copy in
the office of the clerk of the district court of the county in which the
principal office of the mortgage banker is located and shall mail one
copy to each stockholder, partner, officer, director or associate of the
mortgage banker at his last known address.
4. The clerk of the court with which the copy of the inventory is
filed shall file it as any other case or proceeding pending in the court
and shall give it a docket number.
(Added to NRS by 1999, 3756 ; A 2003, 3569 )
1. If the Commissioner takes possession of the property of a
mortgage banker pursuant to NRS 645E.630 , the licensee, officers, directors,
partners, associates or stockholders of the mortgage banker may, within
60 days after the date on which the Commissioner takes possession of the
property, make good any deficit in the assets or capital of the mortgage
banker or remedy any unsafe and injurious conditions or practices of the
mortgage banker.
2. At the expiration of the 60-day period, if the deficiency in
assets or capital has not been made good or the unsafe and injurious
conditions or practices remedied, the Commissioner may apply to the court
to be appointed receiver and proceed to liquidate the assets of the
mortgage banker which are located in this state in the same manner as now
provided by law for liquidation of a private corporation in receivership.
3. No other person may be appointed receiver by any court without
first giving the Commissioner ample notice of his application.
4. The inventory made by the Commissioner and all claims filed by
creditors are open at all reasonable times for inspection, and any action
taken by the receiver upon any of the claims is subject to the approval
of the court before which the cause is pending.
5. The expenses of the receiver and compensation of counsel, as
well as all expenditures required in the liquidation proceedings, must be
fixed by the Commissioner subject to the approval of the court and, upon
certification of the Commissioner, must be paid out of the money in his
hands as the receiver.
(Added to NRS by 1999, 3757 ; A 2003, 3569 )
DISCIPLINARY ACTION
1. For each violation committed by an applicant, whether or not he
is issued a license, the Commissioner may impose upon the applicant an
administrative fine of not more than $10,000, if the applicant:
(a) Has knowingly made or caused to be made to the Commissioner any
false representation of material fact;
(b) Has suppressed or withheld from the Commissioner any
information which the applicant possesses and which, if submitted by him,
would have rendered the applicant ineligible to be licensed pursuant to
the provisions of this chapter; or
(c) Has violated any provision of this chapter, a regulation
adopted pursuant to this chapter or an order of the Commissioner in
completing and filing his application for a license or during the course
of the investigation of his application for a license.
2. For each violation committed by a licensee, the Commissioner
may impose upon the licensee an administrative fine of not more than
$10,000, may suspend, revoke or place conditions upon his license, or may
do both, if the licensee, whether or not acting as such:
(a) Is insolvent;
(b) Is grossly negligent or incompetent in performing any act for
which he is required to be licensed pursuant to the provisions of this
chapter;
(c) Does not conduct his business in accordance with law or has
violated any provision of this chapter, a regulation adopted pursuant to
this chapter or an order of the Commissioner;
(d) Is in such financial condition that he cannot continue in
business with safety to his customers;
(e) Has made a material misrepresentation in connection with any
transaction governed by this chapter;
(f) Has suppressed or withheld from a client any material facts,
data or other information relating to any transaction governed by the
provisions of this chapter which the licensee knew or, by the exercise of
reasonable diligence, should have known;
(g) Has knowingly made or caused to be made to the Commissioner any
false representation of material fact or has suppressed or withheld from
the Commissioner any information which the licensee possesses and which,
if submitted by him, would have rendered the licensee ineligible to be
licensed pursuant to the provisions of this chapter;
(h) Has failed to account to persons interested for all money
received for a trust account;
(i) Has refused to permit an examination by the Commissioner of his
books and affairs or has refused or failed, within a reasonable time, to
furnish any information or make any report that may be required by the
Commissioner pursuant to the provisions of this chapter or a regulation
adopted pursuant to this chapter;
(j) Has been convicted of, or entered a plea of nolo contendere to,
a felony relating to the practice of mortgage bankers or any crime
involving fraud, misrepresentation or moral turpitude;
(k) Has refused or failed to pay, within a reasonable time, any
fees, assessments, costs or expenses that the licensee is required to pay
pursuant to this chapter or a regulation adopted pursuant to this chapter;
(l) Has failed to pay a tax as required pursuant to the provisions
of chapter 363A of NRS;
(m) Has failed to satisfy a claim made by a client which has been
reduced to judgment;
(n) Has failed to account for or to remit any money of a client
within a reasonable time after a request for an accounting or remittal;
(o) Has commingled the money or other property of a client with his
own or has converted the money or property of others to his own use; or
(p) Has engaged in any other conduct constituting a deceitful,
fraudulent or dishonest business practice.
3. An order that imposes discipline and the findings of fact and
conclusions of law supporting that order are public records.
(Added to NRS by 1999, 3757 ; A 2003, 2728 , 3473 ; 2003, 20th Special Session, 223 )
[Expires by limitation 2 years after the date of the repeal of
the federal law requiring each state to establish procedures for
withholding, suspending and restricting the professional, occupational
and recreational licenses for child support arrearages and for
noncompliance with certain processes relating to paternity or child
support proceedings.]
1. If the Commissioner receives a copy of a court order issued
pursuant to NRS 425.540 that provides
for the suspension of all professional, occupational and recreational
licenses, certificates and permits issued to a person who is the holder
of a license as a mortgage banker, the Commissioner shall deem the
license issued to that person to be suspended at the end of the 30th day
after the date on which the court order was issued unless the
Commissioner receives a letter issued to the holder of the license by the
district attorney or other public agency pursuant to NRS 425.550 stating that the holder of the license has
complied with the subpoena or warrant or has satisfied the arrearage
pursuant to NRS 425.560 .
2. The Commissioner shall reinstate a license as a mortgage banker
that has been suspended by a district court pursuant to NRS 425.540
if the Commissioner receives a letter
issued by the district attorney or other public agency pursuant to NRS
425.550 to the person whose license was
suspended stating that the person whose license was suspended has
complied with the subpoena or warrant or has satisfied the arrearage
pursuant to NRS 425.560 .
(Added to NRS by 1999, 3758 ; A 2003, 3570 ; 2005, 2810 , 2817 )
If a person is a partnership, corporation or unincorporated
association, the Commissioner may take any disciplinary action set forth
in this chapter against the person if any member of the partnership or
any officer or director of the corporation or unincorporated association
has committed any act or omission that would be cause for taking such
disciplinary action against a natural person.
(Added to NRS by 1999, 3759 )
HEARINGS; APPEALS
1. If the Commissioner enters an order taking any disciplinary
action against a person or denying a person’s application for a license,
the Commissioner shall cause a written notice of the order to be served
personally or sent by certified mail or telegram to the person.
2. Unless a hearing has already been conducted concerning the
matter, the person, upon application, is entitled to a hearing. If the
person does not make such an application within 20 days after the date of
the initial order, the Commissioner shall enter a final order concerning
the matter.
3. A person may appeal a final order of the Commissioner in
accordance with the provisions of chapter 233B of NRS that apply to a contested case.
(Added to NRS by 1999, 3759 ; A 2003, 985 )
UNLAWFUL ACTS; PENALTIES
It is unlawful for any
person to offer or provide any of the services of a mortgage banker or
otherwise to engage in, carry on or hold himself out as engaging in or
carrying on the business of a mortgage banker without first obtaining a
license as a mortgage banker pursuant to this chapter, unless the person:
1. Is exempt from the provisions of this chapter; and
2. Complies with the requirements for that exemption.
(Added to NRS by 1999, 3759 ; A 2003, 3570 )
It is unlawful for any foreign corporation,
association or business trust to conduct any business as a mortgage
banker within this state, unless it:
1. Qualifies under chapter 80 of NRS;
and
2. Complies with the provisions of this chapter or, if it claims
an exemption from the provisions of this chapter, complies with the
requirements for that exemption.
(Added to NRS by 1999, 3759 ; A 2003, 3570 )
Except as
otherwise provided in NRS 645E.960 , a
person, or any general partner, director, officer, agent or employee of a
person, who violates any provision of this chapter, a regulation adopted
pursuant to this chapter or an order of the Commissioner is guilty of a
misdemeanor.
(Added to NRS by 1999, 3759 )
A person, or any general partner, director, officer, agent or
employee of a person, who violates any provision of NRS 645E.420 , 645E.430 or 645E.440 is guilty of:
1. A misdemeanor if the amount involved is less than $250;
2. A gross misdemeanor if the amount involved is $250 or more but
less than $1,000; or
3. A category D felony if the amount involved is $1,000 or more,
and shall be punished as provided in NRS 193.130 .
(Added to NRS by 1999, 3759 )
