|While state agencies were busy taking actions against mortgage license holders, Nevada regulators rescinded a $30,000 fine levied against a developer that was accused of illegally making mortgages.The Nevada Division of Mortgage Lending had claimed that SURE Development and Real Estate had violated mortgage broker laws by running a newspaper ad seeking loans secured by short-term trust deeds.
SURE, a licensed real estate broker, maintained it did not need a mortgage broker’s license because it did not make any money for arranging loans, according to a statement from the state.
The state agreed with the company and indicated that real estate brokers are exempt from mortgage broker laws “in the course of performing their duties as brokers.”
The fine was rescinded and SURE was given permission to run newspaper ads in the future.
That isn’t the case in Maine where two mortgage lenders paid more than $44,000 in fines and restitution to settle claims made by the state’s Office of Consumer Credit Regulation.
Salem Capital Group and Residential Mortgage Services — specifically loan officer Robert Raymond — were accused of leading customers “into signing mortgages they could not afford,” according to a cease and desist order filed by Maine regulators.
The companies arranged for the borrowers to take short-term loans so they had more cash to qualify for mortgage loans, according to the order.
“The customers … deposited these funds, typically $20,000 to $30,000, in bank accounts and listed the deposits as assets in support of a credit application for first lien mortgages from a licensed broker,” the state said in the order.
The cash loans “were not disclosed to the first-lien lender,” the state said.
“Consumers were assured that they would be able to finance the two loans into a single loan, when in fact Mr. Raymond had no reason to believe that such refinancing would be easy to arrange,” regulators said.
Residential Mortgage Services told regulators it was unaware of Raymond’s activities. But the state said loan officers are “agents of their employer” and “therefore (the company) bears ultimate responsibility.”
The always busy Georgia Department of Banking and Finance took recent action in three cases involving allegations against brokers.
Challenge Financial Investors of St. Petersburg, Fla., entered into a consent decree with regulators and has agreed to pay a $193,000 fine to the state, according to a statement from the department.
The company has lost its mortgage lender’s license and cannot reapply for at least three years. It was accused of breaking the state’s mortgage laws, but the state has not specified the violations.
Two brokers were also issued cease and desist orders for allegedly engaging in “mortgage brokerage/lending activities without a license or under an applicable exemption,” the department said in statements.
The orders were issued to Marsha Law, operator of On Time Processing of Covington, Ga.; and Gladys Marcelin, who was doing business as Marcelin Mortgages, Gladyshomeloans.com and Georgetown Mortgage of Stockbridge, Ga.
Unlicensed Lender Shut Down
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