Bill Text: HI HB2502 | 2012 | Regular Session | Amended
Bill Title: Mortgage Servicers; Mortgage Loan Modifications
Spectrum: Partisan Bill (Democrat 1-0)
Status: (Passed) 2012-07-10 - (S) Act 245, 7/6/2012 (Gov. Msg. No. 1348). [HB2502 Detail]
Download: Hawaii-2012-HB2502-Amended.html
STAND. COM. REP. NO. 2840
Honolulu, Hawaii
RE: H.B. No. 2502
H.D. 2
S.D. 1
Honorable Shan S. Tsutsui
President of the Senate
Twenty-Sixth State Legislature
Regular Session of 2012
State of Hawaii
Sir:
Your Committee on Commerce and Consumer Protection, to which was referred H.B. No. 2502, H.D. 2, entitled:
"A BILL FOR AN ACT RELATING TO MORTGAGE SERVICERS,"
begs leave to report as follows:
The purpose and intent of this measure is to require every mortgage servicer who provides loan modification services that require licensure as a mortgage loan originator to be licensed as a mortgage loan originator, in addition to being licensed as a mortgage servicer.
Your Committee received testimony in support of this measure from the Division of Financial Institutions of the Department of Commerce and Consumer Affairs.
Your Committee finds that persons acting as mortgage servicers provide a range of services, including some mortgage loan modification services that could be considered mortgage loan originator activities. Your Committee further finds that a mortgage servicer license cannot take the place of a mortgage loan originator's license. This measure requires that anyone who provides mortgage loan origination services be licensed to do so, even if that person is already licensed as a mortgage servicer.
Your Committee notes that the companion to this measure, S.B. No. 2764, S.D. 1, which was previously passed by the Senate, contains language that expands the Commissioner of Financial Institutions' rulemaking authority, requires mortgage servicers to register with the Nationwide Mortgage Licensing System if necessary, and provides the Commissioner with more discretion when imposing fines for violations.
Your Committee additionally finds that the language in S.B. No. 2764, S.D. 1, is preferable because it is more in line with national guidance. Mortgage servicers may eventually be required to register with the Nationwide Mortgage Licensing System. Should that occur, the Commissioner of Financial Institutions must have the authority to work with the Nationwide Mortgage Licensing System and establish a program similar to the recently established program for mortgage loan originators and mortgage loan originator companies. Appropriate rulemaking authority also allows the Commissioner to provide guidance to licensees as they apply for licensure or renewal. Discretion to adjust monetary penalties ensures companies are in compliance with licensing requirements, without the risk that a single fine could put a company out of business.
Accordingly, your Committee has amended this measure by replacing its contents with the contents of S.B. No. 2764, S.D. 1, a substantively similar measure, which:
(1) Requires every mortgage servicer who provides loan modification services that would require licensure as a mortgage loan originator to be licensed as a mortgage loan originator, in addition to being licensed as a mortgage servicer;
(2) Allows the Commissioner of Financial Institutions to increase Hawaii's involvement with the Nationwide Mortgage Licensing System, through rulemaking authority and by requiring all mortgage servicers to register with the Nationwide Mortgage Licensing System; and
(3) Provides the Commissioner of Financial Institutions with greater discretion when imposing fines for violations of chapter 454M, Hawaii Revised Statutes.
As affirmed by the record of votes of the members of your Committee on Commerce and Consumer Protection that is attached to this report, your Committee is in accord with the intent and purpose of H.B. No. 2502, H.D. 2, as amended herein, and recommends that it pass Second Reading in the form attached hereto as H.B. No. 2502, H.D. 2, S.D. 1, and be referred to the Committee on Ways and Means.
Respectfully submitted on behalf of the members of the Committee on Commerce and Consumer Protection,
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____________________________ ROSALYN H. BAKER, Chair |
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