(a) Contents.--An application for a license under this chapter shall be on a form prescribed and provided by the department. Consistent with sections 202 E and 405 F(1) of the act of May 15, 1933 (P.L.565, No.111), known as the Department of Banking and Securities Code, all applicants and licensees shall use the Nationwide Mortgage Licensing System and Registry to obtain and maintain licenses under this chapter.

(1) In the case of a mortgage broker, mortgage lender, mortgage servicer or mortgage loan correspondent, the application shall include the following:

(i) The name of the applicant.

(ii) The address of the principal place of business and any branches of the applicant.

(iii) The full name, official title and business address of each director and principal officer of the mortgage loan business.

(iv) Any other information that may be required by the department.

(2) In the case of a mortgage originator, the application shall include the following:

(i) The name of the applicant.

(ii) The name of the sponsoring licensee or excepted person of the applicant and location of the excepted person or licensed location of the licensee to which the applicant is assigned.

(iii) Any other information that may be required by the department.

(3) An applicant shall demonstrate to the department that policies and procedures have been developed to receive and process consumer inquiries and grievances promptly and fairly.

(a.1) Licensing of principal place of business and branches.--All applicants and licensees must establish and maintain a separate license for the principal place of business and each branch.

(b) Duty to update.--All applicants and licensees shall be required to provide the department with written notice of the change in any information contained in an application for a license or for any renewal of a license within ten days of an applicant or licensee becoming aware of the change.

(c) Mortgage lender license.--The department shall issue a mortgage lender license applied for under this chapter if the applicant has:

(1) (Deleted by amendment).

(2) Been approved for and will continue to maintain as a licensee a line of credit, repurchase agreement or equivalent mortgage-funding capability of not less than $1,000,000.

(3) Established a minimum net worth of $250,000 at the time of application and will, at all times thereafter, maintain the minimum net worth.

(4) Been approved for and will continue to maintain as a licensee fidelity bond coverage in accordance with the guidelines established by the Federal National Mortgage Association or the Federal Home Loan Mortgage Corporation.

(5) Obtained and will maintain a surety bond in an amount that will provide coverage for the mortgage originators sponsored by the applicant or licensee, in a form acceptable to the department, prior to the issuance of the license, from a surety company authorized to do business in this Commonwealth. The following shall apply:

(i) The amount of the bond shall be:

(A) $100,000 for an applicant or licensee whose mortgage originators will originate or originated less than $30,000,000 in mortgage loans secured by Pennsylvania dwellings or residential real estate in a calendar year;

(B) $200,000 for an applicant or licensee whose mortgage originators will originate or originated $30,000,000 to $99,999,999.99 in mortgage loans secured by Pennsylvania dwellings or residential real estate in a calendar year;

(C) $300,000 for an applicant or licensee whose mortgage originators will originate or originated $100,000,000 to $249,999,999.99 in mortgage loans secured by Pennsylvania dwellings or residential real estate in a calendar year; and

(D) $500,000 for an applicant or licensee whose mortgage originators will originate or originated $250,000,000 or more in mortgage loans secured by Pennsylvania dwellings or residential real estate in a calendar year.

(ii) For an initial license applicant, the amount of the bond shall be determined by the applicant's anticipated amount of mortgage loans secured by Pennsylvania dwellings or residential real estate originated by its mortgage originators in the first calendar year of licensing. For a licensee, the amount of the bond shall be determined annually by the department based upon the amount of mortgage loans secured by Pennsylvania dwellings or residential real estate originated by the licensee's mortgage originators as indicated on the licensee's periodic report.

(iii) The bond shall run to the Commonwealth and shall be for the use of the Commonwealth and for the use of any consumer who is injured by the acts or omissions of the licensee's mortgage originators that are related to the mortgage loan business regulated by this chapter. No bond shall comply with the requirements of this section unless it contains a provision that it shall not be canceled for any cause unless notice of intention to cancel is given to the department at least 30 days before the day upon which cancellation shall take effect. Cancellation of the bond shall not invalidate the bond regarding the period of time it was in effect.

(6) Designated an individual as the qualifying individual for the principal place of business and separate individuals as branch managers for each branch, as applicable.

(d) Mortgage loan correspondent license.--The department shall issue a loan correspondent's license applied for under this chapter if the applicant:

(1) Obtains and will maintain a bond in the amount of $100,000, in a form acceptable to the department, prior to the issuance of the license, from a surety company authorized to do business in this Commonwealth. The bond shall run to the Commonwealth and shall be for the use of the Commonwealth and any person or persons who obtain a judgment against the mortgage loan correspondent for failure to carry out the terms of any provision for which advance fees are paid. No bond shall comply with the requirements of this section unless it contains a provision that it shall not be canceled for any cause unless notice of intention to cancel is given to the department at least 30 days before the day upon which cancellation shall take effect. A mortgage loan correspondent who can demonstrate to the satisfaction of the department that the correspondent does not and will not accept advance fees shall be exempt from the bond requirement of this paragraph.

(2) Establishes a minimum net worth of $100,000 at the time of application and will, at all times thereafter, maintain the minimum net worth.

(3) Obtains and will maintain a surety bond in an amount that will provide coverage for the mortgage originators sponsored by the applicant or licensee, in a form acceptable to the department, prior to the issuance of the license, from a surety company authorized to do business in this Commonwealth. The following shall apply:

(i) The amount of the bond shall be $100,000 for an applicant or licensee whose mortgage originators will originate or originated less than $30,000,000 in mortgage loans secured by Pennsylvania dwellings or residential real estate in a calendar year; $200,000 for an applicant or licensee whose mortgage originators will originate or originated $30,000,000 to $99,999,999.99 in mortgage loans secured by Pennsylvania dwellings or residential real estate in a calendar year; $300,000 for an applicant or licensee whose mortgage originators will originate or originated $100,000,000 to $249,999,999.99 in mortgage loans secured by Pennsylvania dwellings or residential real estate in a calendar year; and $500,000 for an applicant or licensee whose mortgage originators will originate or originated $250,000,000 or more in mortgage loans secured by Pennsylvania dwellings or residential real estate in a calendar year.

(ii) For an initial license applicant, the amount of the bond shall be determined by the applicant's anticipated amount of mortgage loans secured by Pennsylvania dwellings or residential real estate originated by its mortgage originators in the first calendar year of licensing. For a licensee, the amount of the bond shall be determined annually by the department based upon the amount of mortgage loans secured by Pennsylvania dwellings or residential real estate originated by the licensee's mortgage originators as indicated on the licensee's periodic report.

(iii) The bond shall run to the Commonwealth and shall be for the use of the Commonwealth and for the use of any consumer who is injured by the acts or omissions of the licensee's mortgage originators that are related to the mortgage loan business regulated by this chapter. No bond shall comply with the requirements of this section unless it contains a provision that it shall not be canceled for any cause unless notice of intention to cancel is given to the department at least 30 days before the day upon which cancellation shall take effect. Cancellation of the bond shall not invalidate the bond regarding the period of time it was in effect.

(4) Designates an individual as the qualifying individual for the principal place of business and separate individuals as branch managers for each branch, as applicable.

(e) Mortgage broker license.--

(1) The department shall issue a mortgage broker license applied for under this chapter if the applicant obtains and will maintain a bond in the amount of $100,000, in a form acceptable to the department, prior to the issuance of the license, from a surety company authorized to do business in this Commonwealth. The bond shall be a penal bond conditioned on compliance with this chapter and subject to forfeiture by the department and shall run to the Commonwealth for its use. The bond shall also be for the use of any person against the mortgage broker for failure to carry out the terms of any provision for which advance fees are paid. If the person is aggrieved, the person may, with the written consent of the department, recover advance fees and costs from the bond by filing a claim with the surety company or maintaining an action on the bond. In the alternative, an aggrieved person may recover advance fees and costs by filing a formal complaint against the mortgage broker with the department which shall adjudicate the matter. The adjudication shall be binding upon the surety company and enforceable by the department in Commonwealth Court and by an aggrieved person in any court. Any aggrieved person seeking to recover advance fees and costs from a bond that has already been forfeited by the department or which the department is in the process of forfeiting may recover payment on the bond if, after filing a petition with the department, the department consents to the aggrieved person's requested payment or portion thereof. The department may pay the aggrieved person from the bond proceeds it recovers. Nothing in this section shall be construed as limiting the ability of any court or magisterial district judge to award to any aggrieved person other damages, court costs and attorney fees as permitted by law, but those claims that are not advance fees or related costs may not be recovered from the bond. The department, in its discretion, may consent to or order pro rata or other recovery on the bond for any aggrieved person if claims against the bond may or do exceed its full monetary amount. No bond shall comply with the requirements of this section unless it contains a provision that it shall not be canceled for any cause unless notice of intention to cancel is given to the department at least 30 days before the day upon which cancellation shall take effect. Cancellation of the bond shall not invalidate the bond regarding the period of time it was in effect.

(2) Mortgage brokers who can demonstrate to the satisfaction of the department that they do not and will not accept advance fees shall be exempt from the bond requirement of paragraph (1).

(3) A mortgage broker shall obtain and maintain a surety bond in an amount that will provide coverage for the mortgage originators sponsored by the applicant or licensee, in a form acceptable to the department, prior to the issuance of the license, from a surety company authorized to do business in this Commonwealth. The following shall apply:

(i) The amount of the bond shall be $50,000 for an applicant or licensee whose mortgage originators will originate or originated less than $15,000,000 in mortgage loans secured by Pennsylvania dwellings or residential real estate in a calendar year; $75,000 for an applicant or licensee whose mortgage originators will originate or originated $15,000,000 to $29,999,999.99 in mortgage loans secured by Pennsylvania dwellings or residential real estate in a calendar year; $100,000 for an applicant or licensee whose mortgage originators will originate or originated $30,000,000 to $49,999,999.99 in mortgage loans secured by Pennsylvania dwellings or residential real estate in a calendar year; and $150,000 for an applicant or licensee whose mortgage originators will originate or originated $50,000,000 or more in mortgage loans secured by Pennsylvania dwellings or residential real estate in a calendar year.

(ii) For an initial license applicant, the amount of the bond shall be determined by the applicant's anticipated amount of mortgage loans secured by Pennsylvania dwellings or residential real estate originated by its mortgage originators in the first calendar year of licensing. For a licensee, the amount of the bond shall be determined annually by the department based upon the amount of mortgage loans secured by Pennsylvania dwellings or residential real estate originated by the licensee's mortgage originators as indicated on the licensee's periodic report.

(iii) The bond shall run to the Commonwealth and shall be for the use of the Commonwealth and for the use of any consumer who is injured by the acts or omissions of the licensee's mortgage originators that are related to the mortgage loan business regulated by this chapter. No bond shall comply with the requirements of this section unless it contains a provision that it shall not be canceled for any cause unless notice of intention to cancel is given to the department at least 30 days before the day upon which cancellation shall take effect. Cancellation of the bond shall not invalidate the bond regarding the period of time it was in effect.

(4) A mortgage broker shall designate an individual as the qualifying individual for the principal place of business and separate individuals as branch managers for each branch, as applicable.

(f) Mortgage originator license.--A mortgage originator shall do all of the following:

(1) Be an employee of or under the direct supervision and control of a licensed mortgage broker, mortgage lender or mortgage loan correspondent, a person excepted from this chapter or a person excepted from licensure under section 6112 (relating to exceptions to license requirements). The licensee or person shall sponsor the mortgage originator in the Nationwide Mortgage Licensing System and Registry and directly supervise, control and maintain responsibility for the acts and omissions of the mortgage originator.

(2) Be assigned to and work out of a licensed location of the sponsoring licensee or a location of a sponsoring person excepted from this chapter or excepted from licensure under section 6112, which, in the case of a sponsoring licensee, may be either the mortgage originator's residence or a location of the licensee that is within 100 miles of the mortgage originator's residence.

(3) Maintain a valid unique identifier issued by the Nationwide Mortgage Licensing System and Registry.

(4) If a person excepted from this chapter or excepted from licensure under section 6112 does not elect to maintain bond coverage for its mortgage originators in the same manner as a mortgage lender, a mortgage originator employed by or under the direct supervision and control of a person excepted from this chapter or excepted from licensure under section 6112 shall obtain and maintain a surety bond in an amount that will provide coverage for the mortgage originator, in a form acceptable to the department, prior to the issuance of the license, from a surety company authorized to do business in this Commonwealth. The following shall apply:

(i) The amount of the bond shall be $25,000 for an applicant or licensee who will originate or originated less than $7,500,000 in mortgage loans secured by Pennsylvania dwellings or residential real estate in a calendar year; $50,000 for an applicant or licensee who will originate or originated $7,500,000 to $14,999,999.99 in mortgage loans secured by Pennsylvania dwellings or residential real estate in a calendar year; $75,000 for an applicant or licensee who will originate or originated $15,000,000 to $29,999,999.99 in mortgage loans secured by Pennsylvania dwellings or residential real estate in a calendar year; $100,000 for an applicant or licensee who will originate or originated $30,000,000 to $49,999,999.99 in mortgage loans secured by Pennsylvania dwellings or residential real estate in a calendar year; and $150,000 for an applicant or licensee who will originate or originated $50,000,000 or more in mortgage loans secured by Pennsylvania dwellings or residential real estate in a calendar year.

(ii) For an initial license applicant, the amount of the bond shall be determined by the applicant's anticipated amount of mortgage loans secured by Pennsylvania dwellings or residential real estate originated in the first calendar year of licensing. For a licensee, the amount of the bond shall be determined annually by the department based upon the amount of mortgage loans secured by Pennsylvania dwellings or residential real estate originated by the mortgage originator as indicated on the mortgage originator's periodic report.

(iii) The bond shall run to the Commonwealth and shall be for the use of the Commonwealth and for the use of any consumer who is injured by the acts or omissions of the mortgage originator that are related to the mortgage loan business regulated by this chapter. No bond shall comply with the requirements of this section unless it contains a provision that it shall not be canceled for any cause unless notice of intention to cancel is given to the department at least 30 days before the day upon which cancellation shall take effect. Cancellation of the bond shall not invalidate the bond regarding the period of time it was in effect.

(5) Only engage in the mortgage loan business on behalf of the single mortgage broker, mortgage lender or mortgage loan correspondent or a person excepted from this chapter or a person excepted from licensure under section 6112 that sponsors the mortgage originator.

(g) Nationwide Mortgage Licensing System and Registry information challenge process.--A mortgage originator applicant or licensee may challenge the accuracy of information entered by the department to the Nationwide Mortgage Licensing System and Registry regarding the mortgage originator applicant or licensee by filing a written complaint with the department. The department shall review the complaint and alleged inaccurate information on the Nationwide Mortgage Licensing System and Registry and notify the applicant or licensee of corrective action taken by the department regarding the alleged inaccurate information within 30 days of receipt of the complaint.

(h) License renewals.--Licenses shall be issued for terms not to exceed 14 months and may be renewed by the department each year on a schedule set by the department upon application by the licensee and the payment of any and all applicable renewal fees. The licensee shall demonstrate to the department that it is conducting the mortgage loan business in accordance with the requirements of this chapter and that the licensee or directors, officers, partners, employees, mortgage originators, agents and ultimate equitable owners of 10% or more of the licensee continue to meet all of the initial requirements for licensure required by this chapter unless otherwise determined by the department.

(i) Out-of-State applicants.--

(1) If an applicant is not a resident of this Commonwealth, as a condition to receiving a license under this chapter, the applicant shall be authorized to do business in this Commonwealth in accordance with the laws of this Commonwealth regulating corporations and other entities conducting business in this Commonwealth and shall maintain at least one office which is the office that shall be licensed as the principal place of business for the purposes of this chapter.

(2) Out-of-State applicants shall file with the license application an irrevocable consent, duly acknowledged, that suits and actions may be commenced against that person in the courts of this Commonwealth by the service of process of any pleading upon the department in the usual manner provided for service of process and pleadings by the laws and court rules of this Commonwealth. The consent shall provide that this service shall be as valid and binding as if service had been made personally upon the person in this Commonwealth. In all cases where process or pleadings are served upon the department under the provisions of this section, the process or pleadings shall be served in triplicate; one copy shall be filed in the department's offices and the others shall be forwarded by the department, by certified or registered mail, return receipt requested, to the last known principal place of business of the person.

(j) Disclosure of mortgage originator information.--Notwithstanding section 302 of the act of May 15, 1933 (P.L.565, No.111), known as the Department of Banking and Securities Code, the department shall make available to the public, including by access to the Nationwide Mortgage Licensing System and Registry, the employment history of a mortgage originator.

(k) Mortgage servicer license.--The department shall issue a mortgage servicer license under this chapter if the applicant has:

(1) Been approved by or meets the current eligibility criteria for approval as a residential mortgage loan servicer of at least one Federal Government-sponsored entity, government corporation or Federal agency.

(2) Established a minimum net worth of $250,000 at the time of application and maintains the minimum net worth.

(3) Been approved for and maintains as a licensee fidelity bond coverage in accordance with the guidelines established by the Federal National Mortgage Association or the Federal Home Loan Mortgage Corporation.

(4) Obtained and maintains a surety bond in an amount that will provide coverage for the mortgage servicer in a form acceptable to the department prior to the issuance of the license, from a surety company authorized to do business in this Commonwealth. The following shall apply:

(i) The amount of the bond shall be $500,000.

(ii) The bond shall run to the Commonwealth and shall be for the use of the Commonwealth and for the use of the consumer who is injured by the acts or omissions of the licensee's mortgage originators that are related to the mortgage loan business regulated under this chapter. A bond shall not comply with the requirements of this section unless the bond contains a provision that the bond shall not be canceled for any cause unless notice of intention to cancel is given to the department at least 30 days, excluding legal holidays, Saturdays and Sundays, before the day upon which cancellation shall take effect. Cancellation of the bond shall not invalidate the bond regarding the period of time the bond was in effect.

(5) Designated an individual as the qualifying individual for the principal place of business.

(Aug. 5, 2009, P.L.117, No.31, eff. imd.; July 2, 2013, P.L.210, No.38, eff. 60 days; Dec. 22, 2017, P.L.1260, No.81)

2017 Amendment. Act 81 amended subsec. (a)(1) and added subsec. (k). Section 9(2) of Act 81 provided that the amendment of section 6131 shall take effect upon the effective date of regulations promulgated under section 6141 of this title.

Cross References. Section 6131 is referred to in sections 6112, 6134, 6135, 6139 of this title.