70D-3-402. Prohibited acts.

566 words·~3 min read·/ut/title-70d/chapter-3/70d-3-402

A research copy — for the controlling text, always check the official state or federal source. Not legal advice.

Effective 5/12/2015

(1)An individual transacting the business of a loan originator in this state may not:

(a)violate or not comply with:

(i)this chapter;

(ii)an order of the commissioner under this chapter;

(iii)a rule made by the commissioner under this chapter;

(iv)Title 70C, Utah Consumer Credit Code , if subject to that title; or

(v)Chapter 2, Mortgage Lending and Servicing Act , if subject to that chapter;

(b)engage in an act that is performed to:

(i)evade this chapter; or

(ii)assist another person to evade this chapter;

(c)do any of the following to induce a lender to extend credit as part of a residential mortgage loan transaction:

(i)make a false statement or representation;

(ii)cause a false document to be generated; or

(iii)knowingly permit false information to be submitted by a person in a transaction;

(d)fail to respond within the required time period to:

(i)a notice or complaint of the commissioner; or

(ii)a request for information from the commissioner;

(e)make a false representation to the commissioner, including in a licensure application;

(f)engage in the business of a loan originator with respect to a residential mortgage loan transaction if the individual also acts in any of the following capacities with respect to the same residential mortgage loan transaction:

(i)appraiser;

(ii)escrow agent;

(iii)real estate agent;

(iv)general contractor; or

(v)title insurance agent;

(g)engage in an act or omission in transacting the business of a loan originator that constitutes dishonesty, fraud, or misrepresentation;

(h)engage in false or misleading advertising;

(i)fail to account for money received in connection with a residential mortgage loan;

(ii)use money for a different purpose than the purpose for which the money is received; or

(iii)subject to Subsection

(3), retain money paid for services if the services are not performed;

(j)fail, within 90 calendar days of a request from a borrower who has paid for an appraisal, to give a copy of an appraisal ordered and used for a residential mortgage loan to the borrower;

(k)recommend or encourage default, delinquency, or continuation of an existing default or delinquency, by a mortgage applicant on an existing indebtedness before the closing of a residential mortgage loan that will refinance all or part of the indebtedness;

(l)pay or offer to pay an individual who does not hold a license under this chapter for services that require the individual to hold a license under this chapter; or

(m)violate or fail to comply with a provision of Title 57, Chapter 28, Utah Reverse Mortgage Act .

(a)An individual engaging solely in loan processor or underwriter activities, may not represent to the public that the individual can or will perform any act of a loan originator.

(b)A representation prohibited under this Subsection

(2)includes an advertisement or other means of communicating or providing information including the use of:

(i)a business card;

(ii)stationery;

(iii)a brochure;

(iv)a sign;

(v)a rate list; or

(vi)another promotional item.

(3)Notwithstanding Subsection (1)(i)(iii) , if a licensee complies with Section 70D-2-305 , the licensee may charge a reasonable cancellation fee for services completed to originate a residential mortgage loan if the residential mortgage loan is not closed.

Amended by Chapter 290 , 2015 General Session