The following persons shall not be required to be licensed under this chapter in order to conduct the mortgage loan business:

(1) A banking institution or a federally chartered or State-chartered credit union, if the primary regulator of the banking institution or federally chartered or State-chartered credit union supervises the banking institution or federally chartered or State-chartered credit union. A banking institution or a federally chartered or State-chartered credit union may register with the department for the purpose of having individuals under its direct supervision and control licensed as mortgage originators, provided that the registered entity meet any of the following requirements:

(i) In the same manner as a mortgage lender, obtains and maintains bond coverage for mortgage originators consistent with section 6131(c)(5) (relating to application for license) and files a periodic report consistent with section 6135(a)(3) (relating to licensee requirements).

(ii) Annually, in a form acceptable to the department, demonstrates to the department that all of the mortgage originators employed by or under the direct supervision and control of the entity have obtained and maintained the bond coverage required under section 6131(f)(4).

(2) An attorney at law not otherwise engaged in or holding himself or herself out to the public as being engaged in the mortgage loan business who acts as a mortgage broker or a mortgage originator in negotiating or placing a mortgage loan in the normal course of legal practice. The exception under this paragraph shall not apply if the attorney is compensated by any of the following:

(i) A mortgage broker.

(ii) A mortgage lender.

(iii) A mortgage loan correspondent.

(iv) A person excepted from licensure under this section.

(v) A mortgage originator.

(v.1) A mortgage servicer.

(vi) An agent of a person listed in subparagraphs (i), (ii), (iii), (iv), (v) and (v.1).

(3) A person who originates, services or negotiates less than four mortgage loans in a calendar year, unless determined to be engaged in the mortgage loan business by the department.

(4) Any agency or instrumentality of the Federal Government or a corporation otherwise created by an act of the United States Congress, including the Federal National Mortgage Association, the Government National Mortgage Association, the Veterans' Administration, the Federal Home Loan Mortgage Corporation and the Federal Housing Administration, and employees thereof acting within the scope of their employment.

(5) Any agency or instrumentality of a state or local government, the District of Columbia or any territory of the United States, including the Pennsylvania Housing Finance Agency and other government housing finance agencies, and employees thereof acting within the scope of their employment.

(6) Consumer discount companies, except that a consumer discount company that acts as a mortgage broker, mortgage lender, mortgage servicer or mortgage loan correspondent, shall be subject to the provisions of Subchapter C (relating to mortgage loan business restrictions and requirements) and sections 6131(c)(2), (3) and (5), 6135, 6138 (relating to authority of department) and 6140(b) (relating to penalties). Employees or individuals under the direct supervision and control of licensees under the act of April 8, 1937 (P.L.262, No.66), known as the Consumer Discount Company Act, that act as mortgage originators shall be subject to the licensing requirements of this chapter. Consumer discount companies that employ or directly supervise and control mortgage originators shall be subject to the same requirements as mortgage lenders in regard to the employment and supervision of mortgage originators.

(7) Affiliates of banking institutions and subsidiaries and affiliates of federally chartered or State-chartered credit unions. The exception under this paragraph does not apply to consumer discount companies. Notwithstanding the exception under this paragraph, subsidiaries and affiliates of federally chartered or State-chartered credit unions and affiliates of banking institutions shall:

(i) be subject to the provisions of sections 6121(1), (2), (3), (4), (5), (6), (7), (8), (9), (10), (11), (12), (13) and (14) (relating to general requirements), 6122(a) and (b) (relating to powers conferred on certain licensees engaged in the mortgage loan business), 6123(a) (relating to mortgage loan business prohibitions), 6124 (relating to prohibited clauses in mortgage loan documents), 6125 (relating to mortgage lending authority), 6126 (relating to requirements as to open-end loans), 6135(a)(2), (3) and (4), (b) and (c), 6138 and 6140(b);

(ii) deliver as required to the department annually copies of financial reports made to all supervisory agencies;

(iii) be registered with the department;

(iv) in the same manner as a mortgage lender, obtain and maintain bond coverage for mortgage originators consistent with section 6131(c)(5); and

(v) ensure employees required to be licensed as mortgage originators have completed the requirements under section 6131.1 (relating to prelicensing and continuing education) and have obtained the required mortgage originator license.

(8) Employees or individuals under the direct supervision and control of a mortgage broker, mortgage lender, mortgage servicer or mortgage loan correspondent, or a person excepted from licensure under this section, who are not otherwise required to be licensed as mortgage originators.

(9) Registered mortgage loan originators when acting on behalf of their employers.

(10) (Deleted by amendment).

(11) A bona fide nonprofit organization and employees of the organization acting within the scope of their employment, unless otherwise deemed to be engaged in the mortgage loan business by the department, provided that:

(i) The organization shall be subject to the provisions of Subchapter C and sections 6135(a)(2), (3) and (4) and (c), 6138 and 6140(b).

(ii) The organization shall be registered with the department.

(iii) As required under 24 CFR § 3400.103(e)(7)(iii) (relating to individuals required to be licensed by states), the department must periodically examine the books and activities of an organization it determines is a bona fide nonprofit organization and revoke its status as a bona fide nonprofit organization if it does not continue to meet the criteria under 24 CFR § 3400.103(e)(7)(ii).

(iv) For residential mortgage loans to have terms that are favorable to the borrower, the department must determine that the terms are consistent with loan origination in a public or charitable context, rather than a commercial context.

(v) The department shall make the list of bona fide nonprofit organizations available on its Internet website.

(12) (Deleted by amendment).

(13) An installment seller of, or holder of installment sales contracts secured by, manufactured homes who is licensed under 12 Pa.C.S. Ch. 62 (relating to motor vehicle sales finance), provided the installment seller or holder only engages in the mortgage loan business regarding installment sales contracts secured by manufactured homes that are purchase-money mortgage loans. To qualify for the exception under this paragraph, the installment seller or holder must:

(i) Obtain a license as a mortgage originator, if licensed as an individual under 12 Pa.C.S. Ch. 62.

(ii) Be registered with the department.

(iii) Do either of the following:

(A) In the same manner as a mortgage lender or mortgage broker, as applicable depending upon whether the installment seller or holder makes or brokers installment sales contracts secured by manufactured homes that are purchase-money mortgage loans, obtain and maintain bond coverage for mortgage originators consistent with section 6131(c)(5) or (e)(3) and file a periodic report consistent with section 6135(a)(3); or

(B) Annually demonstrate to the department that the mortgage originators employed by or under the direct supervision and control of the installment seller or holder have obtained and maintained the bond coverage required by section 6131(f)(4) in a form acceptable to the department.

(iv) Ensure employees or individuals under the direct supervision and control of the installment seller or holder required to be licensed as mortgage originators have completed the requirements under section 6131.1 and have obtained the required mortgage originator license.

(14) A nonoriginating person, unless otherwise deemed to be engaged in the mortgage loan business by the department, except that the nonoriginating person shall:

(i) Be subject to the provisions of Subchapter C and sections 6135(a)(2), (3) and (4) and (c), 6138 and 6140(b).

(ii) Be registered with the department.

(iii) In the same manner as a mortgage broker, obtain and maintain bond coverage for mortgage originators consistent with section 6131(c)(5).

(iv) Ensure employees or individuals under the direct supervision and control of the person required to be licensed as mortgage originators have completed the requirements under section 6131.1 and have obtained the required mortgage originator license.

(15) Notwithstanding section 6151 (relating to applicability), a mortgage originator licensed by one or more other states and physically located in this Commonwealth that does not engage in any transactions involving Pennsylvania consumers, dwellings or residential real estate.

(16) A person who engages in mortgage loan modifications for existing mortgage loans held or serviced by that person or that person's employer and who does not otherwise engage in the mortgage loan business.

(17) An individual or entity licensed under the act of September 2, 1965 (P.L.490, No.249), referred to as the Money Transmission Business Licensing Law, if the individual or entity only engages in the mortgage loan business to the extent funds are transmitted from a mortgagor to make mortgage payments on behalf of the mortgagor in order to exceed regularly scheduled minimum payment obligations under the terms of the indebtedness.

(Aug. 5, 2009, P.L.117, No.31, eff. imd.; Nov. 23, 2010, P.L.1346, No.122, eff. imd.; July 2, 2013, P.L.210, No.38, eff. 60 days; Nov. 27, 2013, P.L.1081, No.98, eff. one year; Dec. 22, 2017, P.L.1260, No.81)

2017 Amendment. Act 81 amended pars. (2), (3), (6), (7) and (8) and added par. (17). Section 9(2) of Act 81 provided that the amendment of section 6112 shall take effect upon the effective date of regulations promulgated under section 6141 of this title.

2013 Amendment. Act 98 amended par. (13).

Cross References. Section 6112 is referred to in sections 6102, 6111, 6123, 6131 of this title.