SB 2090 Summary

• Creates new Chapter 13-12 establishing a separate licensing regime for residential mortgage lenders under the Department of Financial Institutions, with application fees of $400 (non-refundable investigation fee) plus $400 annual license fee, plus $50 per branch location.

• Requires residential mortgage lenders to maintain a $50,000 surety bond and minimum net worth of $25,000, with licenses expiring December 31 annually and subject to suspension or revocation for violations.

• Prohibits net branching arrangements and establishes prohibited practices including fraud, misrepresentation, advance fees (except appraisal/credit report deposits and interest rate locks), false advertising, and precomputed loans.

• Sets maximum annual interest rates at 36% and limits late payment charges to 5% of payment amount (capped at $20 for loans of $50,000 or less) and establishes enhanced protections for small loans under $2,000.

• Amends money broker licensing rules (Chapter 13-04.1) to exclude residential mortgage lenders licensed under the new chapter, increases civil penalties to $100,000 per occurrence plus $1,000 per day, and repeals call report requirements; existing money broker licensees have until December 31, 2023 to transition to residential mortgage lender licenses.