RCW 19.146.205
License -- Application -- Applicant to furnish
information establishing identity -- Background check -- Fee -- Bond or
alternative. (Effective until January 1, 2010.)
(1) Application
for a mortgage broker license under this chapter shall be in
writing and in the form prescribed by the director. The
application shall contain at least the following information:
(a) The name, address, date of birth, and social security
number of the applicant, and any other names, dates of birth, or
social security numbers previously used by the applicant, unless
waived by the director;
(b) If the applicant is a partnership or association, the
name, address, date of birth, and social security number of each
general partner or principal of the association, and any other
names, dates of birth, or social security numbers previously used
by the members, unless waived by the director;
(c) If the applicant is a corporation, the name, address,
date of birth, and social security number of each officer,
director, registered agent, and each principal stockholder, and
any other names, dates of birth, or social security numbers
previously used by the officers, directors, registered agents,
and principal stockholders unless waived by the director;
(d) The street address, county, and municipality where the
principal business office is to be located;
(e) The name, address, date of birth, and social security
number of the applicant's designated broker, and any other names,
dates of birth, or social security numbers previously used by the
designated broker and a complete set of the designated broker's
fingerprints taken by an authorized law enforcement officer; and
(f) Such other information regarding the applicant's or
designated broker's background, financial responsibility,
experience, character, and general fitness as the director may
require by rule.
(2) As a part of or in connection with an application for
any license under this section, the applicant shall furnish
information concerning his or her identity, including
fingerprints for submission to the Washington state patrol, the
federal bureau of investigation, and any governmental agency or
entity authorized to receive this information for a state and
national criminal history background check; personal history;
experience; business record; purposes; and other pertinent facts,
as the director may reasonably require. As part of or in
connection with an application for a license under this chapter,
the director is authorized to receive criminal history record
information that includes nonconviction data as defined in RCW 10.97.030. The department may only disseminate nonconviction
data obtained under this section to criminal justice agencies.
This section does not apply to financial institutions regulated
under chapters 31.12 and 31.13 RCW and Titles 30, 32, and 33 RCW.
(3) At the time of filing an application for a license under
this chapter, each applicant shall pay to the director the
appropriate application fee in an amount determined by rule of
the director in accordance with RCW 43.24.086 to cover, but not
exceed, the cost of processing and reviewing the application.
The director shall deposit the moneys in the financial services
regulation fund, unless the consumer services account is created
as a dedicated, nonappropriated account, in which case the
director shall deposit the moneys in the consumer services
account.
(4)(a) Each applicant for a mortgage broker's license shall
file and maintain a surety bond, in an amount of not greater than
sixty thousand dollars nor less than twenty thousand dollars
which the director deems adequate to protect the public interest,
executed by the applicant as obligor and by a surety company
authorized to do a surety business in this state as surety. The
bonding requirement as established by the director may take the
form of a uniform bond amount for all licensees or the director
may establish by rule a schedule establishing a range of bond
amounts which shall vary according to the annual average number
of loan originators of a licensee. The bond shall run to the
state of Washington as obligee, and shall run first to the
benefit of the borrower and then to the benefit of the state and
any person or persons who suffer loss by reason of the
applicant's or its loan originator's violation of any provision
of this chapter or rules adopted under this chapter. The bond
shall be conditioned that the obligor as licensee will faithfully
conform to and abide by this chapter and all rules adopted under
this chapter, and shall reimburse all persons who suffer loss by
reason of a violation of this chapter or rules adopted under this
chapter. Borrowers shall be given priority over the state and
other persons. The state and other third parties shall be
allowed to receive distribution pursuant to a valid claim against
the remainder of the bond. In the case of claims made by any
person or entity who is not a borrower, no final judgment may be
entered prior to one hundred eighty days following the date the
claim is filed. The bond shall be continuous and may be canceled
by the surety upon the surety giving written notice to the
director of its intent to cancel the bond. The cancellation
shall be effective thirty days after the notice is received by
the director. Whether or not the bond is renewed, continued,
reinstated, reissued, or otherwise extended, replaced, or
modified, including increases or decreases in the penal sum, it
shall be considered one continuous obligation, and the surety
upon the bond shall not be liable in an aggregate or cumulative
amount exceeding the penal sum set forth on the face of the bond.
In no event shall the penal sum, or any portion thereof, at two
or more points in time be added together in determining the
surety's liability. The bond shall not be liable for any
penalties imposed on the licensee, including, but not limited to,
any increased damages or attorneys' fees, or both, awarded under
RCW 19.86.090. The applicant may obtain the bond directly from
the surety or through a group bonding arrangement involving a
professional organization comprised of mortgage brokers if the
arrangement provides at least as much coverage as is required
under this subsection.
(b) Subsection (4)(b) and (c) of this section applies only
to applications received on or before January 1, 2007. Before
January 1, 2007, in lieu of a surety bond, the applicant may,
upon approval by the director, file with the director a
certificate of deposit, an irrevocable letter of credit, or such
other instrument as approved by the director by rule, drawn in
favor of the director for an amount equal to the required bond.
(c) Before January 1, 2007, in lieu of the surety bond or
compliance with (b) of this subsection, an applicant may obtain
insurance or coverage from an association comprised of mortgage
brokers that is organized as a mutual corporation for the sole
purpose of insuring or self-insuring claims that may arise from a
violation of this chapter. An applicant may only substitute
coverage under this subsection for the requirements of (a) or (b)
of this subsection if the director, with the consent of the
insurance commissioner, has authorized such association to
organize a mutual corporation under such terms and conditions as
may be imposed by the director to ensure that the corporation is
operated in a financially responsible manner to pay any claims
within the financial responsibility limits specified in (a) of
this subsection.
[2006 c 19 § 10; 2001 c 177 § 4; 1997 c 106 § 9; 1994 c 33 § 8; 1993 c 468 § 6.]
NOTES:
Effective date -- 2001 c 177: See note following RCW 43.320.080.
Severability -- 1997 c 106: See note following RCW 19.146.010.
Adoption of rules -- Severability -- 1993 c 468: See notes following RCW 19.146.0201.
Effective dates -- 1993 c 468: See note following RCW 19.146.200.
RCW 19.146.205
License -- Application -- Applicant to furnish
information establishing identity -- Background check -- Fee -- Bond or
alternative. (Effective January 1, 2010.)
(1) Application for a
mortgage broker license under this chapter must be made to the
nationwide mortgage licensing system and registry and in the form
prescribed by the director. The application shall contain at
least the following information:
(a) The name, address, date of birth, and social security
number of the applicant, and any other names, dates of birth, or
social security numbers previously used by the applicant, unless
waived by the director;
(b) If the applicant is a partnership or association, the
name, address, date of birth, and social security number of each
general partner or principal of the association, and any other
names, dates of birth, or social security numbers previously used
by the members, unless waived by the director;
(c) If the applicant is a corporation, the name, address,
date of birth, and social security number of each officer,
director, registered agent, and each principal stockholder, and
any other names, dates of birth, or social security numbers
previously used by the officers, directors, registered agents,
and principal stockholders unless waived by the director;
(d) The street address, county, and municipality where the
principal business office is to be located;
(e) The name, address, date of birth, and social security
number of the applicant's designated broker, and any other names,
dates of birth, or social security numbers previously used by the
designated broker and a complete set of the designated broker's
fingerprints taken by an authorized law enforcement officer; and
(f) Such other information regarding the applicant's or
designated broker's background, financial responsibility,
experience, character, and general fitness as the director may
require by rule.
(2) As a part of or in connection with an application for
any license under this section, or periodically upon license
renewal, the applicant shall furnish information concerning his
or her identity, including fingerprints for submission to the
Washington state patrol, the federal bureau of investigation, the
nationwide mortgage licensing system and registry, or any
governmental agency or entity authorized to receive this
information for a state and national criminal history background
check; personal history; experience; business record; purposes;
and other pertinent facts, as the director may reasonably
require. As part of or in connection with an application for a
license under this chapter, the director is authorized to receive
criminal history record information that includes nonconviction
data as defined in RCW 10.97.030. The department may only
disseminate nonconviction data obtained under this section to
criminal justice agencies. This section does not apply to
financial institutions regulated under chapters 31.12 and 31.13 RCW and Titles 30, 32, and 33 RCW.
(3) In order to reduce the points of contact which the
federal bureau of investigation may have to maintain, the
director may use the nationwide mortgage licensing system and
registry as a channeling agent for requesting information from
and distributing information to the department of justice or any
governmental agency.
(4) In order to reduce the points of contact which the
director may have to maintain, the director may use the
nationwide mortgage licensing system and registry as a channeling
agent for requesting and distributing information to and from any
source so directed by the director.
(5) At the time of filing an application for a license under
this chapter, each applicant shall pay to the director through
the nationwide mortgage licensing system and registry the
appropriate application fee in an amount determined by rule of
the director in accordance with RCW 43.24.086 to cover, but not
exceed, the cost of processing and reviewing the application.
The director shall deposit the moneys in the financial services
regulation fund, unless the consumer services account is created
as a dedicated, nonappropriated account, in which case the
director shall deposit the moneys in the consumer services
account.
(6)(a) Except as provided in (b) of this subsection, each
applicant for a mortgage broker's license shall file and maintain
a surety bond, in an amount which the director deems adequate to
protect the public interest, executed by the applicant as obligor
and by a surety company authorized to do a surety business in
this state as surety. The bonding requirement as established by
the director shall take the form of a range of bond amounts which
shall vary according to the annual loan origination volume of the
licensee. The bond shall run to the state of Washington as
obligee, and shall run first to the benefit of the borrower and
then to the benefit of the state and any person or persons who
suffer loss by reason of the applicant's or its loan originator's
violation of any provision of this chapter or rules adopted under
this chapter. The bond shall be conditioned that the obligor as
licensee will faithfully conform to and abide by this chapter and
all rules adopted under this chapter, and shall reimburse all
persons who suffer loss by reason of a violation of this chapter
or rules adopted under this chapter. Borrowers shall be given
priority over the state and other persons. The state and other
third parties shall be allowed to receive distribution pursuant
to a valid claim against the remainder of the bond. In the case
of claims made by any person or entity who is not a borrower, no
final judgment may be entered prior to one hundred eighty days
following the date the claim is filed. The bond shall be
continuous and may be canceled by the surety upon the surety
giving written notice to the director of its intent to cancel the
bond. The cancellation shall be effective thirty days after the
notice is received by the director. Whether or not the bond is
renewed, continued, reinstated, reissued, or otherwise extended,
replaced, or modified, including increases or decreases in the
penal sum, it shall be considered one continuous obligation, and
the surety upon the bond shall not be liable in an aggregate or
cumulative amount exceeding the penal sum set forth on the face
of the bond. In no event shall the penal sum, or any portion
thereof, at two or more points in time be added together in
determining the surety's liability. The bond shall not be liable
for any penalties imposed on the licensee, including, but not
limited to, any increased damages or attorneys' fees, or both,
awarded under RCW 19.86.090. The applicant may obtain the bond
directly from the surety or through a group bonding arrangement
involving a professional organization comprised of mortgage
brokers if the arrangement provides at least as much coverage as
is required under this subsection.
(b) If the director determines that the bond required in (a)
of this subsection is not reasonably available, the director
shall waive the requirements for such a bond. The mortgage
recovery fund account is created in the custody of the state
treasurer. The director is authorized to charge fees to fund the
account. All fees charged under this section, except those
retained by the director for administration of the fund
[account], must be deposited into the mortgage recovery fund
account. Expenditures from the account may be used only for the
same purposes as the surety bond as described in (a) of this
subsection. Only the director or the director's designee may
authorize expenditures from the account. The account is subject
to allotment procedures under chapter 43.88 RCW, but an
appropriation is not required for expenditures. A person
entitled to receive payment from the mortgage recovery fund
[account] may only receive reimbursement after a court of
competent jurisdiction has determined the actual damages caused
by the licensee. The director may determine by rule the
procedure for recovery; the amount each mortgage broker must pay
through the nationwide mortgage licensing system and registry for
deposit in the mortgage recovery fund [account]; and the amount
necessary to administer the fund [account].
[2009 c 528 § 4; 2006 c 19 § 10; 2001 c 177 § 4; 1997 c 106 § 9; 1994 c 33 § 8; 1993 c 468 § 6.]
NOTES:
Effective date -- License requirement -- Implementation -- 2009 c 528: See notes following RCW 19.146.010.
Effective date -- 2001 c 177: See note following RCW 43.320.080.
Severability -- 1997 c 106: See note following RCW 19.146.010.
Adoption of rules -- Severability -- 1993 c 468: See notes following RCW 19.146.0201.
Effective dates -- 1993 c 468: See note following RCW 19.146.200.