Section II

I hold a mortgage license. How often can I expect to have my operations examined by your Department?

Most examinations conducted by the Department are done so on a "targeted" basis. Targeted examinations result from any number of reasons, but are often scheduled as a result of information provided to the Department from a consumer complaint, a company insider indicating operational or problematic issues, or other industry insiders reporting questionable operations. If any of these reasons exist, you can expect to see us at any time, and as often as every 90 days. We will monitor your operations to ensure that they are conducted in a manner that protects the contractual and property rights of the citizens of Georgia.

What is a "Transaction Journal"?

A Transaction Journal is essentially a list of the mortgage applications that you have had. Rule 80-11-2-.03 establishes what must be on this list, including the name of the customer, the date the customer applied for the mortgage loan, and the disposition of the mortgage loan application.

For examination purposes, do I need to maintain all canceled checks?

Yes. Rules 80-11-2-.01 (4) and 80-11-2-.02 (1) (h) specify that all canceled checks be kept for a period of five years.

Where can I find a copy of the current Georgia Residential Mortgage Act and the Rules and Regulations of the Department?

Click on the link below. Select the License Application Package option. Listed there are options to download the Act and the Regulations in either Word or Adobe PDF formats.

Georgia Residential Mortgage Act - Code and Regulations

I want to become a mortgage licensee. What fees are charged by your Department?

Annual licensing/renewal fees are as follows:

• $1,000 per year for Mortgage Lenders required to be licensed; $1,000 per year for Mortgage Lenders required to be registered; $500 per year for Mortgage Brokers/Processors required to be licensed;
• $500 per year for Mortgage Brokers/Processors required to be registered.

In addition, a $250 non-refundable initial Investigation Fee for a Mortgage License or Registration is charged when the initial application is filed, but is not charged for renewals.

Other Fees:

• Applications requiring fingerprint card submissions for individuals require a $30 fee per person to run the background checks;
• Branch Application - $350;Change-in-Control Application - $500;
• GRMA Per Loan Fee - Each licensee who closes a loan in their name is required to collect a $6.50 "per loan" fee from the borrower on each loan. These fees are aggregated and remitted twice each year to the Department (See "Reports" below). On-line reporting is available at: https://bkgfin.dbf.state.ga.us/GRMAFee.html.

Note that one branch location, in addition to the main office location, is included in the fee for the initial application for licensing. Any additional branches over one included in the initial application, or branch applications submitted subsequent to license approval, require the payment of a $350 application fee per branch.

Does your Department ever fine its licensees?

Yes. Fines are imposed to insure that licensees operate as specified by the GRMA and the rules promulgated by the Department (the Code and Regulations). Fines provide the Department an option other than license REVOCATION OR SUSPENSION in order to insure compliance with GRMA. Those licensees who operate in a professional manner and strictly observe the provisions of the Code will probably never be fined. Those who ignore the provisions of the Code or who commit prohibited acts will likely pay thousands in fines.

My lender has required that I obtain PMI. What is PMI? How can I eliminate this expense?

Mortgage insurance is a type of guarantee to protect lenders against the costs of foreclosure. The protection is provided by private mortgage-insurance companies. Private Mortgage Insurance (PMI) allows lenders to accept a lower down payment than usual and is often required when you buy a house with less than 20% down. The insurance provides the assurance of repayment that a higher down payment would provide to cover a lender's losses in the event of foreclosure. Without mortgage insurance coverage, you might not be able to buy a home without at least a 20% down payment. The cost of PMI increases as your down payment decreases. For instance: the cost of PMI on a 7% down payment is less than the cost of PMI on a 5% down payment. Your PMI premium is normally added to your monthly mortgage payment.

For loans originated before July 29, 1999, the decision on when you may cancel your private insurance coverage does not always depend solely on the degree of your equity in the home. Sometimes, the final say on terminating a private mortgage-insurance policy is reserved jointly for the lender and any investor who may have purchased an interest in the mortgage. However, PMI can and should be terminated if certain conditions are met. The borrower may cancel PMI on the cancellation date (when equity reaches 20%) if the borrower: Submits a written request to the servicer, has a good payment history as defined in the law, and has satisfied the holder of the mortgage with evidence that the value of the property securing the mortgage has not declined below the original value and certifies that there is not a subordinate lien. If you want to request cancellation of PMI on your loan, contact your lender. In most cases, an appraisal will be required to determine the value of your property, and you will probably be required to pay for the cost of this appraisal. Another way of canceling the PMI on your loan is to refinance and get a new loan without PMI. For loans originating after July 29, 1999, the new Homeowner's Protection Act of 1998 applies. This law enables homeowners who meet certain criteria to have their PMI canceled. The law provides for two situations when the borrower-paid PMI may be canceled - it can be automatic or by request. Lender-paid PMI is excluded from these mandates but requires an up front disclosure to the borrower about lender-paid PMI.

Automatic Cancellation: In general and unless specific exceptions exist, when the homeowner's equity position reaches 22 percent of the original value of the property, the mortgage servicer must terminate collection of PMI charges.

Where can I obtain additional information about the provisions of compliance with RESPA?

RENEWAL PROCESS & CONTINUING EDUCATION

I already have a mortgage license. What will happen when it is time to renew my license?

Notices for license renewal application submissions are usually mailed in February of each year. Applications must be filed NO LATER than April 1 of each year. There is a substantial fine for late filing of a renewal application, and renewal of a license will not occur until all outstanding fines are paid. The Department has moved to an Internet based renewal application system. Applicants complete the application and pay all outstanding fees and fines via the Internet, and in order to avoid being fined for late renewal, licensees must complete their application and payment by April 1 of each year.

All other outstanding business or administrative issues with our licensees will be settled at renewal time. No renewal applications will be approved until all outstanding issues have been resolved.

Are there any continuing education requirements in Georgia in order to maintain a Broker/Processor license?

Yes. Beginning with the FY2008 renewal year, brokers and processors must have obtained 12 hours of continuing education in order to renew their license. Refer to Regulation 80-11-4-.01 (7) for specifics regarding the regulation, but in general the following requirements exist:

• Hours Required: Brokers must obtain 12 hours of continuing education in a 12 month period prior to the annual renewal deadline.
• Qualifying Attendees: The qualifying attendee will be the individual owner of the licensee, or a person designated and employed by the licensee as the primary supervisor or manager of the business.
• Qualifying Courses: Courses approved by mortgage related state and federal regulatory agencies, the National Association of Mortgage Brokers, state and federally regulated lenders and affiliates, and other approved providers. Courses consisting of monthly association meetings, conventions, seminars or those provided through electronic means, will qualify as continuing education hours, provided the subject meets the requirements of the rule.
• Course Content: Generally course material must pertain to state and federal rules and regulations on the mortgage industry, the brokering process, loan application processing, proper loan documentation, and, in general, operating a mortgage brokering business in Georgia. NOTE-At least one hour shall be concentrated on fraud detection and prevention annually.
• Proof of Training: Licensees must maintain course documentation as noted in the rule, i.e. name of course, provider, date, etc., and must maintain such documentation for a period of 5 years. Approved Georgia in-state education providers must maintain lists of attendees for 2 years.
• Fine: Licensees who apply for renewal, but who have failed to meet the continuing education requirements will be fined $1,000, and will have from April 1 to June 30 prior to the new fiscal year licensing period, which starts July 1 of each year, to obtain CE credits. If the CE hours are not obtained in the make-up period, the renewal will not be approved.
  
  

I am a mortgage licensee. What reports must I file with the Department each year?

License Renewal Applications must be filed no later than April 1st each year.

The "$6.50 Fee statement" is due twice each year: one report is due September 1 (covers all residential mortgage activity from January 1 through June 30 of that year); the second report is due March 1 (covers the period of July 1 through December 31 of the previous year).

"Letter Form" reports must be made anytime an employee is suspected of criminal activity or when the licensee is sued or relocates the business.

Reports of the main office or an approved branch relocation, or of a mailing address change, can be made on-line here.

To report the closing of a branch office, these can be made on-line here.

To report the changes in company contact information (company or complaint contact) or a change in registered agent, these can be made on-line here.

Notificants: To report the changes in contact information or a change in registered agent, these can be made on-line here.

What telemarketing activites require a license for a company that solicits and sells mortgage leads ?

The requirement for a license depends on the information taken, which might be an "application" for state licensing purposes. The following information applies to "telemarketing" - whether the information is obtained via standard phone solicitations, or through internet lead generation.

• Telemarketers who accept applications for loans on their own initiative from consumers and without a contract from a licensee for sale of the contact to licensees are required to be licensed under the Act.
• Telemarketers who contact Georgia consumers and generate a list of potential residential mortgage contracts under a written contract from a licensee are not required to be licensed, provided:
  • The telemarketer makes it clear that they are contacting the consumer on behalf of (a) specific licensee(s);
  • The fee for the service is on a "flat-fee" basis, not a "per-loan" basis or a closed loan fee basis;
  • The company must be in the telemarketing business and not perform other mortgage related functions for the licensee; and
  • The company may only gather minimal contact and non-specific property or income information. Information gathered which is sufficient to verify credit, employment, income, date of birth etc. cannot be gathered. This is considered application information and the telemarketer must then have their own license.