TITLE XXXV
BANKS AND BANKING; LOAN ASSOCIATIONS; CREDIT UNIONS

Chapter 397-A
LICENSING OF NONDEPOSITORY MORTGAGE BANKERS, BROKERS, AND SERVICERS

Section 397-A:1

    397-A:1 Definitions. –
In this chapter:
I. "Agent" means any individual, other than a mortgage banker, mortgage broker, or mortgage servicer who is employed or retained by a mortgage banker, mortgage broker, or mortgage servicer required to be licensed under this chapter, and who represents a mortgage banker, mortgage broker, or mortgage servicer in soliciting, finding, negotiating, arranging, or processing mortgage loans.
I-a. "Affiliate" means a relationship between 2 or more persons if either person has the power to control the other, or where a third person controls or has the power to control such persons. Affiliates shall include but not be limited to:
(a) Interlocking directorates or ownership; or
(b) Identity of interests among members of a family.
II. "At closing" means the time at which the mortgage and the note are executed by the borrower.
III. "Borrower" means a homeowner or purchaser of a home who obtains funds from another by the signing of a note and mortgage deed on a dwelling. The term shall include any legal successor to the borrower's rights or obligations.
IV. "Branch office" means a location within or without this state of a person required to be licensed under this chapter that is identified by any means to the public as a location at which a mortgage banker, mortgage broker, or mortgage servicer conducts New Hampshire mortgage business. Branch office does not include:
(a) A person's principal office location.
(b) A location identified solely in a telephone directory line listing or on a business card or letterhead if:
(1) The listing, card, or letterhead also sets forth the address and telephone number of a New Hampshire licensed office of the mortgage banker, mortgage broker, or mortgage servicer from which all individuals conducting mortgage business from such identified location are directly supervised, provided that such supervisory office is located within 100 miles of the identified location; and
(2) No more than one agent, employee, originator, or other representative transacts business on behalf of the mortgage banker or mortgage broker from such identified location.
(c) Any other location not within the intent of this paragraph as the commissioner may determine.
V. "Commissioner" means the bank commissioner.
V-a. "Control" means the power, directly or indirectly, to direct the management or policies of a company, whether through ownership of securities, by contract, or otherwise. Any person is presumed to control a company that:
(a) Is a director, general partner, or executive officer;
(b) Directly or indirectly has the right to vote 10 percent or more of a class of a voting security or membership interest, or has the power to sell or direct the sale of 10 percent or more of a class of voting securities or membership interest;
(c) In the case of a limited liability company, is a managing member; or
(d) In the case of a partnership, has the right to receive upon dissolution, or has contributed, 10 percent or more of the capital.
VI. "Department" means the banking department.
VI-a. "Direct owner" means any person, including an individual, that owns, beneficially owns, has the right to vote, or has the power to sell or direct the sale of 10 percent or more of the applicant or licensee.
VI-b. "Depository institution" has the same definition as in section 3 of the Federal Deposit Insurance Act, and includes any insured credit union.
VI-c. "Dwelling" means a residential structure or mobile or manufactured home which contains one to 4 family housing units located in New Hampshire whether or not attached to real property, or individual units of condominiums or cooperatives. The term includes manufactured housing, a mobile home, and a trailer if it is used or intended to be used as a residence.
VI-d. "Engaged in the business of" means to act or hold oneself out as acting in a commercial context and with some degree of habitualness or repetition.
VI-e. "Federal banking agency" means the Board of Governors of the Federal Reserve System, the Comptroller of the Currency, the Director of the Office of Thrift Supervision, the National Credit Union Administration, or the Federal Deposit Insurance Corporation.
VI-f. "Financial services" or "financial services-related" means securities, commodities, banking, insurance, consumer lending, or real estate, including, but not limited to, acting as or being associated with a bank or savings association, credit union, mortgage lender, mortgage broker, mortgage servicer, real estate salesperson or agent, closing agent, title company, or escrow agent.
VII. "First mortgage loan" means a loan secured in whole or in part by a mortgage upon any interest in real property used or intended to be used as a dwelling with accommodations for not more than 4 families, which property is not subject to the lien of any prior mortgage, and shall include retail installment contracts secured by manufactured housing as defined in RSA 205-A:1 and the renewal or refinancing of an existing first mortgage loan.
VIII. "Indirect owner" means, with respect to direct owners and other indirect owners in a multilayered organization:
(a) In the case of an owner that is a corporation, each of its shareholders that beneficially owns, has the right to vote, or has the power to sell or direct the sale of, 25 percent or more of that corporation.
(b) In the case of an owner that is a partnership, all general partners and those limited and special partners that have the right to receive upon dissolution, or have contributed, 25 percent or more of the partnership's capital.
(c) In the case of an owner that is a trust, the trust, each trustee, and each beneficiary of 25 percent or more of the trust.
(d) In the case of an owner that is a limited liability company ("LLC"):
(1) Those members that have the right to receive upon dissolution, or have contributed, 25 percent or more of the LLC's capital; and
(2) If managed by elected managers, all elected managers.
(e) In the case of an indirect owner, the parent owners of 25 percent or more of their subsidiary.
VIII-a. "Individual" means a natural person.
VIII-b. "Immediate family member" means a spouse, child, sibling, parent, grandparent, or grandchild. "Immediate family member" includes stepparents, stepchildren, stepsiblings, and adoptive relationships.
IX. "Lender" means any person that provides the initial funding for a mortgage and includes any legal successor to the rights of the lender. For the purpose of a table-funded transaction, the lender is the person who actually provides the funds for the transaction.
X. "Licensee" means a person, whether mortgage banker, mortgage broker, mortgage originator, or mortgage servicer, duly licensed by the commissioner pursuant to the provisions of this chapter.
XI. "Loan" means any loan of money or goods or forbearance of money and goods or choses in action.
XI-a. (a) "Loan processor" or "underwriter" means an individual who performs clerical or support duties as an employee of and at the direction of and subject to the supervision and instruction of a licensed mortgage banker, licensed mortgage broker, or licensed mortgage servicer.
(b) For purposes of this paragraph, "clerical or support duties" may include subsequent to the receipt of an application:
(1) The receipt, collection, distribution, and analysis of information common for the processing or underwriting of a residential mortgage loan; or
(2) Communicating with a consumer to obtain the information necessary for the processing or underwriting of a loan, to the extent that such communication does not include offering or negotiating loan rates or terms or counseling consumers about residential mortgage loan rates or terms.
(c) An individual engaging solely in loan processor or underwriter activities shall not represent to the public, through advertising or other means of communicating or providing information including the use of business cards, stationery, brochures, signs, rate lists, or other promotional items, that such individual can or will perform any of the activities of a mortgage loan originator.
XI-b. "Management level employee" means any officer of record, assistant vice president or higher, office or branch manager, director of operations, or other position the responsibilities of which provide such employee with the discretion or ability to set policy or manage or direct affairs of the licensee as a whole, or of any division or department or unit of the licensee.
XII. "Mortgage banker" means a person not exempt under RSA 397-A:4 who, for compensation or gain, or in the expectation of compensation or gain, whether such compensation or gain is direct or indirect:
(a) Makes or originates a mortgage loan as payee on the note evidencing the loan;
(b) Advances, or offers to advance, or makes or offers to make, a commitment to advance a banker's funds for a mortgage loan, or closes a mortgage loan in its own name or with the banker's funds; or
(c) Otherwise funds or offers to fund a mortgage loan.
XIII. "Mortgage broker" means a person not exempt under RSA 397-A:4 who for compensation or gain, or in the expectation of compensation or gain, either directly or indirectly:
(a) Acts or offers to act as an intermediary, finder, or agent of a lender or borrower for the purpose of negotiating, arranging, finding, or procuring mortgage loans, or commitments for mortgage loans.
(b) Offers to serve as agent for any person in an attempt to obtain a mortgage loan.
(c) Offers to serve as agent for any person who has money to lend for a mortgage loan.
XIII-a. "Mortgage lender" means a mortgage banker.
XIV. "Mortgage loan" or "residential mortgage loan" means any loan, including a first or second mortgage loan, primarily for personal, family, or household use which is secured in whole or in part by a mortgage, deed of trust, or other equivalent consensual security interest upon a dwelling or any interest in real property or in residential real estate.
XIV-a. "Mortgage servicing company" or "mortgage servicer" means an individual, partnership, corporation, association, or other entity however organized and wherever located which, for itself or on behalf of the holder of a mortgage loan, holds the servicing rights or records such payments on its books and records and performs such other administrative functions as may be necessary to properly carry out the mortgage holders obligations under the mortgage agreement including, when applicable, the receipt of funds from the mortgagor to be held in escrow for payment of real estate taxes and insurance premiums and the distribution of such funds to the taxing authority and insurance company.
XIV-b. "Nationwide Multistate Licensing System and Registry" means a national licensing system and facility developed and maintained by the Conference of State Bank Supervisors and the American Association of Residential Mortgage Regulators, or their successors, for the licensing and registration of mortgage loan originators, mortgage lenders, mortgage servicers, and mortgage brokers or any similar system established by the Secretary of the United States Department of Housing and Urban Development.
XIV-c. "Nontraditional mortgage product" means any mortgage product other than a 30-year fixed-rate mortgage.
XV. "Note" means the instrument, other than the mortgage, evidencing or containing the debt secured by the mortgage, or any renewal or refinancing of such instrument.
XVI. "Open end credit" means a plan prescribing the terms of credit transactions which may be made thereunder from time to time and under the terms of which a finance charge may be charged from time to time on an outstanding unpaid balance.
XVII. (a) "Originator" or "mortgage loan originator" or "mortgage originator" or "loan originator" means an individual who for direct or indirect compensation or gain or in the expectation of direct or indirect compensation or gain, takes a mortgage application or offers, negotiates, solicits, arranges, or finds a mortgage loan or who offers or negotiates terms of a residential mortgage loan. Mortgage loan originator does not include:
(1) An individual engaged solely as a loan processor or underwriter except as otherwise provided in RSA 397-A:3, VIII;
(2) An individual engaged solely in loan modification activities not resulting in a new extension of credit;
(3) A person that only performs real estate brokerage activities and is licensed or registered in accordance with applicable state law, unless the person or entity is compensated by a lender, a mortgage broker, mortgage servicer, or other mortgage loan originator or by any agent of such lender, mortgage broker, mortgage servicer, or other mortgage loan originator;
(4) A person solely involved in extensions of credit relating to timeshare plans, as that term is defined in 11 U.S.C. Section 101(53D); and
(5) Any individual who is not otherwise described in subparagraph (a) and who performs purely administrative or clerical tasks as an employee at the direction of and subject to the supervision and instruction of a licensed person who is described in subparagraph (a).
(b) For purposes of this paragraph, "takes a mortgage application" means:
(1) Recording the borrower's application information in any form for use in a credit decision; or
(2) Receiving the borrower's application information in any form for use in a credit decision.
XVIII. "Person" means an individual, corporation, business trust, estate, trust, partnership, association, 2 or more persons having a joint or common interest, or any other legal or commercial entity however organized.
XIX. "Principal" of the applicant or licensee means an owner with 10 percent or more ownership interest, corporate officer, director, member, general or limited liability partner, limited partner with 10 percent or more ownership interest, trustee, beneficiary of 10 percent or more of the trust that owns the applicant or licensee, indirect owner, senior manager, branch manager of a location required to be licensed as a branch office under this chapter, and any person occupying similar status or performing similar functions.
XX. "Principal office" means the main office location of a person required to be licensed under this chapter.
XX-a. "Publicly traded" means a company whose securities are traded on a securities exchange system approved and supervised by the Securities and Exchange Commission, including but not limited to the NYSE, AMEX, BSE, and NASDAQ. The term also includes a public reporting company that is subject to sections 12 or 15(d) of the Securities Exchange Act of 1934.
XX-b. "Real estate brokerage activity" means, for purposes of this chapter only, any activity that involves offering or providing real estate brokerage services to the public, including:
(a) Acting as a real estate agent or real estate broker for a buyer, seller, lessor, or lessee of real property;
(b) Bringing together parties interested in the sale, purchase, lease, rental, or exchange of real property;
(c) Negotiating, on behalf of any party, any portion of a contract relating to the sale, purchase, lease, rental, or exchange of real property other than in connection with providing financing with respect to any such transaction;
(d) Engaging in any activity for which a person engaged in the activity is required to be registered or licensed as a real estate agent or real estate broker under any applicable law; and
(e) Offering to engage in any activity, or act in any capacity, described in subparagraph (a), (b), (c), or (d).
XXI. "Real property" means a dwelling or land and the improvements which are affixed thereon or are intended to be affixed thereon, including, but not limited to, single-family homes and multifamily dwellings not exceeding 4 units, wholly or partly used or occupied, or intended to be used or occupied, as the home or residence of one or more persons.
XXI-a. "Registered mortgage loan originator" means any individual who:
(a) Meets the definition of mortgage loan originator and is an employee of:
(1) A depository institution;
(2) A subsidiary that is:
(A) Owned and controlled by a depository institution; and
(B) Regulated by a federal banking agency; or
(3) An institution regulated by the Farm Credit Administration; and
(b) Is registered with, and maintains a unique identifier through, the Nationwide Multistate Licensing System and Registry as required by the federal banking agencies.
XXI-b. "Residential real estate" means any real property located in New Hampshire, upon which is constructed or intended to be constructed a dwelling.
XXI-c. "Reverse mortgage" means a mortgage loan generally available to seniors, usually 62 years of age and older, in which a mortgage, deed of trust, or equivalent consensual security interest securing one or more advances is created in the consumer's dwelling and the payment stream for principal, interest, shared appreciation, or equity is not due and payable until a maturity event or default occurs or any similar debt instrument as the commissioner determines.
XXII. "Second mortgage loan" means a loan secured in whole or in part by a mortgage upon any interest in real property used or intended to be used as a dwelling with accommodations for not more than 4 families, which property is subject to the lien of one or more prior mortgages, and shall include home equity loans and the renewal or refinancing of an existing second mortgage loan.
XXIII. "Secondary market" means the market where lenders and investors buy and sell existing mortgages or mortgage-backed securities.
XXIII-a. "Senior manager" means a management level employee.
XXIII-b. "Significant event" means:
(a) Filing for bankruptcy or reorganization;
(b) Criminal felony indictment or conviction of any of the licensee's principals;
(c) Receiving notification of a license denial, cease and desist, consent agreement or order, suspension, or revocation, or any other formal administrative action in any state against the licensee;
(d) Receiving notification of any enforcement action or investigation by the attorney general of the state of New Hampshire or of any other state pursuant to any consumer protection statute, and the reasons therefor, except routine investigations of consumer complaints; or
(e) Entering into a consent agreement, settlement agreement, memorandum of understanding, or similar agreement with any regulatory body pertaining to the licensee's practices.
XXIV. "Table funding" means a settlement at which a loan is funded by a contemporaneous advance of loan funds and an assignment of a loan to the person advancing the funds. A table-funded transaction is not a secondary market transaction.
XXV. "Unique identifier" means a number or other identifier assigned by protocols established by the Nationwide Multistate Licensing System and Registry.

Source. 2016, 289:1, eff. Aug. 20, 2016. 2018, 196:3, 14, eff. Aug. 7, 2018. 2019, 36:5, eff. May 15, 2019.

Section 397-A:2

    397-A:2 Application of Chapter. –
I. This chapter shall provide for the department's regulation of persons that engage in the business of a mortgage banker, mortgage broker, mortgage servicer, or mortgage originator for a mortgage loan from the state of New Hampshire or a mortgage loan secured by real property located in the state of New Hampshire. The following persons are not considered to be engaged in the business of activities requiring regulation under this chapter:
(a) An individual who offers or negotiates terms of a residential mortgage loan with or on behalf of an immediate family member of the individual.
(b) An individual who offers or negotiates terms of a residential mortgage loan secured by a dwelling that served as the individual's residence.
(c)(1) An attorney licensed in New Hampshire performing activities that are within the definition of a loan originator, provided that such activities are:
(A) Considered by the New Hampshire supreme court to be part of the authorized practice of law within New Hampshire;
(B) Carried out within an attorney-client relationship; and
(C) Accomplished by the attorney in compliance with all applicable laws, rules, ethics, and standards.
(d) An individual who acts as a mortgage banker, mortgage broker, mortgage servicer, or mortgage originator if the individual is not engaged habitually and repeatedly in such activities in a commercial context. It shall be a rebuttable presumption that an individual is not engaged in the business of a mortgage banker, mortgage broker, mortgage servicer, or mortgage originator if the individual is not involved in more than 3 loans in any consecutive 12-month period.
II. Any mortgage loan made, brokered, or serviced under the provisions of this chapter shall be further governed by any other applicable laws of the state of New Hampshire and by the Consumer Credit Protection Act (15 U.S.C. Section 1601 et seq.), as amended.
III. Persons subject to or licensed under this chapter shall abide by applicable federal laws and regulations, the laws and rules of this state, and the orders of the commissioner. Any violation of such law, regulation, order, or rule is a violation of this chapter. Such federal laws and regulations include but are not limited to the Bank Secrecy Act (BSA), 31 U.S.C. Section 5311 et seq. and 31 C.F.R. Part X et seq. when required by the BSA, and include interpretive orders and similar directives.
IV. Any condition, stipulation, or provision binding any person to waive compliance with any provision of this chapter or any rule or order under this chapter is void.

Source. 2016, 289:1, eff. Aug. 20, 2016. 2018, 211:1, eff. Aug. 7, 2018.

Section 397-A:3

    397-A:3 License Required. –
I. Prior to engaging in the business of a mortgage broker, mortgage banker, mortgage originator, or mortgage servicer, a person shall obtain and maintain a license under this chapter. Each mortgage banker, broker, originator or servicer shall register with and obtain and maintain a valid unique identifier issued by the Nationwide Multistate Licensing System and Registry.
II. An originator's license is only in effect when such originator is employed or retained by a licensed mortgage banker, mortgage broker, or mortgage servicer or by a person exempt from this chapter that has registered or made a filing as an exempt entity on the Nationwide Multistate Licensing System.
III. A person licensed as mortgage banker may act as a mortgage broker or mortgage servicer without obtaining a separate license.
IV. The fact that a person is licensed or registered in the state of New Hampshire under this chapter does not constitute a finding that the commissioner has passed in any way upon the merits or qualifications of such person or that the commissioner has recommended or given approval to any person. It is unlawful to make, or cause to be made, to any prospective purchaser, customer, or client any representation inconsistent with the provisions of this paragraph.
V. Any license fee required by this chapter shall be paid before a license may become effective.
VI. A sole proprietor licensed as a mortgage broker, mortgage servicer, or mortgage banker shall also obtain a license as a mortgage originator prior to acting as a mortgage originator.
VII. A person located outside of the United States and required to be licensed under this chapter shall maintain a location within the continental United States where records of all New Hampshire transactions are kept and from where all activity under this chapter shall be conducted.
VIII. An individual engaging in the business of a loan processor or underwriter as an independent contractor, shall obtain and maintain licenses as a mortgage loan originator and as a mortgage broker, mortgage banker, or mortgage servicer, and shall maintain a valid unique identifier issued by the Nationwide Multistate Licensing System.
IX. Before an individual begins activities that require licensure as an originator in this state, the originator and the mortgage banker, mortgage broker, or mortgage servicer who employs or retains the originator shall file an application with the commissioner to license the originator in this state. When an individual ceases to be employed or retained as an originator by a mortgage banker, mortgage broker, or mortgage servicer, the originator's license shall terminate and the mortgage banker, mortgage broker, or mortgage servicer shall notify the commissioner within 15 calendar days. If the mortgage banker, mortgage broker, or mortgage servicer ceases to be licensed under this chapter for any reason, the licenses of originators employed or retained by the mortgage banker, mortgage broker, or mortgage servicer shall terminate unless an originator's license is suspended, revoked, or transferred to another licensed mortgage banker, mortgage broker, or mortgage servicer.
X. A branch office of a mortgage banker, mortgage broker, or mortgage servicer shall be licensed prior to conducting business at such location.
XI. For purposes of licensing its mortgage loan originators in this state, other entities and financial institutions not otherwise required to be licensed under this chapter may voluntarily make a filing on the Nationwide Multistate Licensing System and Registry as an exempt entity and in such case shall comply with RSA 397-A:4, IV(a)(1), (3), (4), (5), and (6).

Source. 2016, 289:1, eff. Aug. 20, 2016. 2017, 103:1, eff. Aug. 7, 2017. 2018, 196:14, eff. Aug. 7, 2018.

Section 397-A:3-a

    397-A:3-a Prohibitions. –
I. No individual may act as an originator for more than one mortgage broker, mortgage servicer, mortgage banker, or other financial institution at the same time, unless the entities are affiliates.
II. No individual may act as a principal for more than one mortgage broker, mortgage servicer, mortgage banker, or other financial institution at the same time, unless the entities are affiliates.
III. A mortgage banker, mortgage broker, or mortgage servicer shall not employ, retain, or otherwise engage an originator unless the originator is licensed.

Source. 2016, 289:1, eff. Aug. 20, 2016.

Section 397-A:4

    397-A:4 Exemptions. –
The provisions of this chapter shall not apply to:
I. Depository institutions or an institution regulated by the Farm Credit Administration.
II. Registered mortgage loan originators, when acting for an entity described in paragraph I or for a subsidiary that is owned and controlled by an entity described in paragraph I.
III. Federal, state, or local governmental agencies, instrumentalities, and corporations and the employees of such entities who act as loan originators and mortgage servicers pursuant to their official duties as employees of the entities provided that with regard to those activities that would otherwise be within the scope of this chapter:
(a) Such government entity operates:
(1) To promote affordable housing, housing improvement assistance, or to provide homeownership education, or similar services.
(2) To conduct its activities in a manner that serves public or charitable purposes.
(3) To receive funding and revenues and to charge fees in a manner that does not incentivize the organization or its employees to act other than in the best interests of its clients.
(4) To compensate employees in a manner that does not incentivize employees to act other than in the best interests of its clients.
(5) Absent a commercial context and without a pecuniary interest.
(b) The government employees who act as loan originators and mortgage servicers as employees of government entities and pursuant to government funded and regulated housing assistance programs do so:
(1) For public or charitable purposes, and not for the profit of another individual or entity.
(2) Not within a commercial context.
(c) In addition, if a second mortgage loan is offered in conjunction with a first mortgage loan funded by a state entity exempt under this paragraph, but such second mortgage is negotiated, arranged, found, or procured through a licensed loan originator that is not employed by the exempt state entity, such second mortgage shall be exempt if:
(1) The second mortgage is offered consistent with the standards in subparagraph III(a); and
(2) The licensed loan originator is not compensated for the second mortgage in a manner that incentivizes the loan originator to act other than in the best interest of the consumer.
IV. (a) Exempt nonprofit entities, provided that such entity:
(1) Is authorized to conduct mortgage banker, mortgage broker, or mortgage servicer business in this state by an order of the commissioner or is authorized by New Hampshire statute to do mortgage lending;
(2) Files as an exempt entity on the Nationwide Multistate Licensing System and Registry;
(3) Conforms to the requirements of the Nationwide Multistate Licensing System and Registry including but not limited to the reporting requirements;
(4) Files and maintains a bond in accordance with RSA 397-A:5, III(c) to cover the business conducted by its originators;
(5) Licenses its originators in this state through the Nationwide Multistate Licensing System and Registry; and
(6) Cooperates with and provides access to records and documents required by the commissioner to carry out examinations of its licensed originators' activities in accordance with RSA 397-A:12.
(b)(1) In this paragraph, "exempt nonprofit entities" means nonprofit agencies or persons which have a tax exempt status granted under the provisions of section 501(c)(3) or 501(c)(4) of the Internal Revenue Code; and
(A) Exclusively make or issue commitments for mortgage loans on residential property to be financed by a governmental entity with public funds, or negotiate, place, assist in placement of, find, or offer to negotiate, place, assist in placement of, or find mortgage loans on residential property to be financed with public funds exclusively under a contract with a governmental entity; or
(B) Make or issue commitments for mortgage loans on residential property and are determined by the commissioner to be organized exclusively for benevolent or charitable purposes for the benefit of New Hampshire consumers.
(2) For purposes of this definition, the making of a mortgage loan includes being named as the lender or mortgagee on the note, mortgage, or other loan documents.
V. An owner of real property who, in any consecutive 12-month period, makes no more than 3 mortgage loans to purchasers of the property for all or part of the purchase price of the real estate against which the mortgage is secured. The owner of real property in such transactions shall not be considered to be engaged in the business of mortgage loan origination.

Source. 2016, 289:1, eff. Aug. 20, 2016. 2018, 196:14, eff. Aug. 7, 2018. 2019, 60:1, 2, eff. June 5, 2019.

Section 397-A:5

    397-A:5 License Application; Requirements; Investigation. –
I. To be considered for mortgage banker, mortgage broker, or mortgage servicer licensing, each person shall complete and file an application with the department, through the Nationwide Multistate Licensing System and Registry using the Nationwide Multistate Licensing System and Registry form. At a minimum, the application shall state the primary business address of the applicant, the applicant's tax identification number, the address of its principal office and all branch offices, and a list of the principals of the applicant. Each principal shall provide his or her social security number and shall authorize the commissioner to conduct a background check. The applicant shall submit any other information that the commissioner may require including, but not limited to, the applicant's form and place of organization, the applicant's proposed method of doing business, the qualifications and business history of the applicant and its principals, and the applicant's financial condition and history. The applicant shall disclose whether the applicant or any of its principals has ever been issued or been the subject of an injunction or administrative order, has ever been convicted of a misdemeanor involving financial services or a financial services-related business or any fraud, false statements or omissions, theft or any wrongful taking of property, bribery, perjury, forgery, counterfeiting, extortion, or a conspiracy to commit any of these offenses or has ever been convicted of any felony.
II. (a) Unless the mortgage banker, mortgage broker, or mortgage servicer applicant is a publicly traded corporation, the department shall complete a background investigation and criminal history records check on the applicant's principals and any person in a similar position or performing similar functions. If the applicant is a subsidiary, the department shall complete a background investigation and criminal history records check on the individuals who are indirect owners.
(b) The persons described in subparagraph (a) shall submit to the department a criminal history records release form, as provided by the New Hampshire division of state police, which authorizes the release of the person's criminal records, if any. The person shall submit with the release form a complete set of fingerprints taken by a qualified law enforcement agency or an authorized employee of the banking department. In the event that the first set of fingerprints is invalid due to insufficient pattern, a second set of fingerprints is necessary in order to complete the criminal history records check. If, after 2 attempts, a set of fingerprints is invalid due to insufficient pattern, the department may, in lieu of the criminal history records check, accept police clearances from every city, town, or county where the person has lived during the past 5 years.
(c) The department shall submit the criminal history records release form to the New Hampshire division of state police which shall conduct a criminal history records check through its records and through the Federal Bureau of Investigation. Upon completion of the background investigation, the division of state police shall release copies of the criminal conviction records to the department. The department shall maintain the confidentiality of all criminal history records information received pursuant to this paragraph.
(d) The department may require the applicant or licensee to pay the actual costs of each background investigation and criminal history records check.
(e) The department may rely on criminal records checks reported through the Nationwide Multistate Licensing System and Registry in lieu of subparagraphs (b) and (c).
III. (a) The mortgage banker, mortgage broker, or mortgage servicer license issued for the licensee's principal place of business shall be referred to as a "principal office license." Each additional license issued for New Hampshire mortgage lending, brokering, or servicing activity occurring in a location that is separate from the licensee's principal place of business shall be referred to as a "branch office license."
(b) Each mortgage banker, mortgage broker, or mortgage servicer license application shall be accompanied by a nonrefundable application fee of $500 for each separate office location to be licensed. Sums collected under this chapter shall be payable to the state treasurer as restricted revenue and credited to the appropriation for the commissioner, consumer credit administration division.
(c) Each mortgage banker, mortgage broker, or mortgage servicer applicant shall be required to submit to the department detailed financial information sufficient for the commissioner to determine the applicant's ability to conduct the business of a mortgage banker, a mortgage broker, or a mortgage servicer with financial integrity. The application shall include a balance sheet, income statement, cash flow statement, statement of owner's equity, and note disclosure, and shall be prepared in accordance with generally accepted accounting principles. An applicant or licensee shall demonstrate and maintain a minimum positive net worth in the amount of at least $25,000. Minimum net worth shall be maintained in an amount that reflects the dollar amount of loans originated as determined by the commissioner. Net worth statements provided in connection with a license application under this section shall be subject to review and verification during the course of any examination or investigation conducted under the authority of RSA 397-A:12. Each mortgage banker and mortgage servicer applicant shall post a continuous surety bond in the minimum amount of $100,000 to the commissioner that shall be increased under conditions set by rule. Each mortgage broker shall post a continuous surety bond in the minimum amount of $50,000 to the commissioner that shall be increased under conditions set by rule. Surety bonds shall provide coverage in an amount that reflects the dollar amount of loans originated by each mortgage loan originator employed by or retained by the mortgage banker, mortgage broker, or mortgage servicer as determined by the commissioner. Surety bonds shall include a provision requiring the surety to give written notice to the commissioner 30 days in advance of the cancellation or termination of the bond. Every bond shall provide that no recovery may be made against the bond unless the state makes a claim for recovery or the person brings suit naming the licensee within 6 years after the act upon which the recovery or suit is based. When an action is commenced on a licensee's bond, the licensee shall immediately file a new bond. Immediately upon recovery upon any action on the bond the licensee shall file a new bond.
(d) No person shall be issued or continue to hold a mortgage banker or mortgage broker license unless at least one person employed full-time in a supervisory capacity at the company's principal office shall have been actively engaged in the mortgage business in a similar supervisory capacity for a minimum of 3 of the preceding 5 years.
(e) Mortgage bankers and mortgage servicers shall designate an individual contact person who shall be a control person of their organization to communicate with department personnel on foreclosure workouts and foreclosure avoidance procedures. The contact person shall have authority to facilitate foreclosure workouts, and foreclosure avoidance procedures. The contact person shall be named in the license application and the mortgage banker or mortgage servicer shall update the department with a new or interim contact person whenever the designated contact person changes, within 7 business days of such change.
IV. Every applicant for mortgage banker, mortgage broker, or mortgage servicer licensing under this chapter shall file with the commissioner irrevocable consent appointing the commissioner to receive service of any lawful process in any noncriminal suit, action, or proceeding against the applicant or the applicant's successor, executor, or administrator which arises under this chapter or any rule or order under this chapter after the consent has been filed, with the same force and validity as if served personally on the person filing the consent. A person who has filed such a consent in connection with a previous registration need not file another. When any person, including any nonresident of this state, engages in conduct prohibited or made actionable by this chapter or any rule or order under this chapter, and such person has not filed a consent to service of process under this section and personal jurisdiction over such person cannot otherwise be obtained in this state, that conduct shall be considered equivalent to such person's appointment of the commissioner to receive service of any lawful process. Service may be made by leaving a copy of the process in the office of the commissioner along with $5, but is not effective unless:
(a) The plaintiff, who may be the attorney general in a suit, action, or proceeding instituted by him or her, forthwith sends a notice of the service and a copy of the process by certified mail to the defendant or respondent at such person's last address on file with the commissioner; and
(b) The plaintiff's affidavit of compliance with this paragraph is filed in the case on or before the date specified by the court on the summons, if any, or within such further time as the court allows.
IV-a. To be considered for originator licensing, the applicant shall complete and file an application with the department, through the Nationwide Multistate Licensing System and Registry, using the Nationwide Multistate Licensing System and Registry form. The application shall be signed under oath by both the originator applicant and the licensed mortgage banker, mortgage broker, or mortgage servicer for whom the individual will originate mortgage loans. Each licensed mortgage originator shall register with and maintain a valid unique identifier issued by the Nationwide Multistate Licensing System and Registry. At a minimum, the application shall state the primary business address of the applicant and the applicant's social security number and shall authorize the commissioner to conduct a background check. The applicant shall submit any other information that the commissioner and the Nationwide Multistate Licensing System and Registry may require including, but not limited to, the applicant's residential and employment history. The applicant shall disclose his or her financial, criminal, regulatory civil, arbitration, civil litigation, and employment termination history, including but not limited to, whether the applicant has ever been issued or been the subject of an injunction or administrative order or has ever been charged with or convicted of a misdemeanor or any felony. Each license application shall be accompanied by a nonrefundable license fee of $100. A mortgage originator's license may be transferred during a calendar year from one mortgage banker, mortgage broker, or mortgage servicer to another upon payment of a $50 fee and approval by the commissioner. Sums collected under this chapter shall be payable to the state treasurer as restricted revenue and credited to the appropriation for the commissioner, consumer credit administration division.
IV-b. Each mortgage loan originator operating in New Hampshire and each mortgage loan originator making or brokering mortgage loans on New Hampshire real property and each principal of a mortgage banker, mortgage broker, or mortgage servicer shall, in addition to other requirements in New Hampshire law and regulations, prior to licensure:
(a) Furnish to the Nationwide Multistate Licensing System and Registry information concerning the applicant's or principal's identity, including:
(1) Fingerprints for submission to the Federal Bureau of Investigation, and any governmental agency or entity authorized to receive such information for a state, national, and international criminal history background check; and
(2) Personal history and experience in a form prescribed by the commissioner and the Nationwide Multistate Licensing System and Registry including the submission of authorization for the Nationwide Multistate Licensing System and Registry and the commissioner to obtain:
(A) An independent credit report obtained from a consumer reporting agency described in section 603(p) of the Fair Credit Reporting Act;
(B) Information related to any administrative, civil, or criminal findings by any law enforcement entity, court, or governmental jurisdiction;
(C) Criminal history record information; and
(D) Other background information as may be required by the commissioner.
(b) For the purposes of this paragraph and in order to reduce the points of contact which the Federal Bureau of Investigation may have to maintain for subparagraphs (a)(1) and (a)(2)(B), the commissioner may use the Nationwide Multistate Licensing System and Registry as a channeling agent for requesting information from and distributing information to the department of justice or any governmental agency.
(c) For the purposes of this paragraph and in order to reduce the points of contact which the commissioner may have to maintain for purposes of subparagraphs (a)(2)(A) and (B), the commissioner may use the Nationwide Multistate Licensing System and Registry as a channeling agent for requesting and distributing information to and from any source so directed by the commissioner.
IV-c. (a) The commissioner shall not issue a mortgage loan originator license unless the commissioner makes at a minimum the following findings that the applicant:
(1) Has never had a mortgage loan originator license revoked in any governmental jurisdiction, except that a subsequent formal vacation of such revocation shall not be deemed a revocation; and
(2) Has not been convicted of, or pled guilty or nolo contendere to:
(A) Any felony in a domestic, foreign, or military court occurring at any time during the 10-year period prior to the date of the application that has not been pardoned; or
(B) Any felony in a domestic, foreign, or military court at any time that has not been pardoned and which involves an act of fraud, dishonesty, theft, or a breach of trust or money laundering, or other crime concerning financial services or a financial services-related business including crimes related to making false statements or omissions, any theft or wrongful taking of property, bribery, perjury, forgery, counterfeiting, extortion, or a conspiracy to commit any of these offenses; and
(C) Any felony more than 10 years prior the date of application that has not been pardoned, except that if the felony is not for an act of fraud, dishonesty, theft, or a breach of trust or money laundering, or other crime concerning financial services or a financial services-related business including crime related to making false statements, or omissions, any theft or wrongful taking of property, bribery, perjury, forgery, counterfeiting, extortion, or a conspiracy to commit any of these offenses, the commissioner may allow licensure by rule or order; and
(3) [Repealed].
(4) Has never been convicted of, or pled guilty or nolo contendere in a domestic, foreign, or military court to, a misdemeanor that has not been pardoned and which involves an act of fraud, dishonesty, theft, or a breach of trust or money laundering or other misdemeanor concerning financial services or a financial services-related business, including a crime related to making false statements or omissions, any theft or wrongful taking of property, bribery, perjury, forgery, counterfeiting, extortion, or a conspiracy to commit any of these offenses, except that for such a misdemeanor conviction occurring more than 10 years prior to the date of application, the commissioner may allow licensure by rule or order; and
(5) Has demonstrated financial responsibility, character, and general fitness such as to command the confidence of the community and to warrant a determination that the mortgage loan originator will operate honestly, fairly, and efficiently within the purposes of this chapter. For purposes of this subparagraph a person has shown that he or she is not financially responsible when he or she has shown a disregard in the management of his or her own financial condition. A determination that an individual has not shown financial responsibility may include, but not be limited to:
(A) Bankruptcies filed within the previous 10 years;
(B) Current outstanding judgments, except judgments solely as a result of medical expenses;
(C) Current outstanding tax liens or other government liens and filings;
(D) Foreclosures within the previous 3 years;
(E) A pattern of serious delinquent accounts within the past 3 years; and
(6) Is covered by a surety bond maintained by the mortgage banker, mortgage servicer, or mortgage broker who employs or retains the originator. The surety bond shall provide coverage for each mortgage loan originator in an amount that reflects the dollar amount of loans originated as determined by the commissioner; and
(7) Has completed at least 20 hours of education approved in accordance with subparagraph (c), which shall include at least:
(A) Three hours of federal law and regulations;
(B) Three hours of ethics, which shall include instruction on fraud, consumer protection, and fair lending issues;
(C) Two hours of training related to lending standards for the nontraditional mortgage product marketplace; and
(D) Two hours of New Hampshire mortgage law education if the person did not previously pass a written test specific to New Hampshire mortgage laws; and
(8) Has passed a written test that meets the test requirement described in subparagraph (d).
(b) The commissioner may conditionally approve an application for a mortgage loan originator license if the applicant is currently licensed as a loan originator in another state and has met the requirements of subparagraph (a)(1) through (a)(7)(C). The conditionally approved mortgage loan originator license shall expire after 60 days if the applicant fails to provide the commissioner with proof that the applicant has obtained 2 hours of New Hampshire mortgage law education required by subparagraph (a)(7)(D) and passed a written test as required by subparagraph (a)(8).
(c) Pre-licensing education courses shall be reviewed and approved by the Nationwide Multistate Licensing System and Registry based upon reasonable standards. Review and approval of a pre-licensing education course shall include review and approval of the course provider. Pre-licensing education may be offered either in a classroom, online, or by any other means approved by the Nationwide Multistate Licensing System and Registry. The pre-licensing education requirements approved by the Nationwide Multistate Licensing System and Registry for any state shall be accepted as credit towards completion of pre-licensing education requirements in New Hampshire. An individual previously licensed under this chapter subsequent to July 31, 2009 who applies for a new license shall prove that he or she has completed all of the continuing education requirements for the year in which the license was last held.
(d)(1) For purposes of subparagraph (a)(8), an individual shall pass, in accordance with the standards established under this subparagraph, a qualified written test developed by the Nationwide Multistate Licensing System and Registry and administered by a test provider approved by the Nationwide Multistate Licensing System and Registry based upon reasonable standards.
(2) A written test shall not be treated as a qualified written test for purposes of this subparagraph unless the test adequately measures the applicant's knowledge and comprehension in appropriate subject areas, including but not limited to:
(A) Ethics.
(B) Federal law and regulation pertaining to mortgage origination.
(C) State law and regulation pertaining to mortgage origination.
(D) Federal and state law and regulation, including instruction on fraud, consumer protection, the nontraditional mortgage marketplace, and fair lending issues.
(3) Nothing in this paragraph shall prohibit a test provider approved by the Nationwide Multistate Licensing System and Registry from providing a test at the location of the employer of the applicant or the location of any subsidiary or affiliate of the employer of the applicant, or the location of any entity with which the applicant holds an exclusive arrangement to conduct the business of a mortgage loan originator.
(4) An individual shall not be considered to have passed a qualified written test unless the individual achieves a test score of not less than 75 percent correct answers to questions. An individual may retake a test 3 consecutive times with each consecutive taking occurring at least 30 days after the preceding test. After failing 3 consecutive tests, an individual shall wait at least 6 months before taking the test again.
(5) A licensed mortgage originator who fails to maintain a valid license for a period of 5 years or longer shall retake the test, not taking into account any time during which such individual is a registered mortgage loan originator.
IV-d. (a) In addition to other provisions in New Hampshire law and rules, in order to be eligible to renew a license, a mortgage originator shall:
(1) Meet and continue to meet the minimum standards for license issuance under paragraph IV-c;
(2) Satisfy the annual continuing education requirements described in paragraph IV-e; and
(3) Pay the annual originator license renewal fee of $100.
(b) The license of a mortgage loan originator failing to satisfy the minimum standards for license renewal shall expire. The commissioner may adopt procedures for the reinstatement of expired licenses consistent with the standards established by the Nationwide Multistate Licensing System and Registry. The commissioner may deny or refuse to renew a mortgage loan originator's license for failure to meet minimum standards, for failure to pay outstanding fees or fines, for violation of state or Federal law and regulations, and for other good cause.
(c) Unless the commissioner has refused to renew or has denied a mortgage originator's application for renewal, an originator's license shall remain in force until it has been surrendered, revoked, or suspended, or terminates or expires in accordance with the provisions of this chapter, including subparagraph (b). Each license shall expire on December 31 of each calendar year.
IV-e. (a) In order to renew a license, an originator shall complete at least 8 hours of education approved in accordance with subparagraph (b), which shall include at least:
(1) Three hours of federal law and regulations;
(2) Two hours of ethics, which shall include instruction on fraud, consumer protection, and fair lending issues; and
(3) Two hours of training related to lending standards for the nontraditional mortgage product marketplace.
(b) For purposes of subparagraph (a), continuing education courses shall be reviewed and approved by the Nationwide Multistate Licensing System and Registry based upon reasonable standards. Review and approval of a continuing education course shall include review and approval of the course provider. Continuing education may be offered either in a classroom or online or by any other means approved by the Nationwide Multistate Licensing System and Registry.
(c) A mortgage originator shall:
(1) Only receive credit for a continuing education course in the year in which the course is taken; and
(2) Not take the same approved course in the same or successive years to meet the annual requirements for continuing education.
(d) A mortgage originator who is an approved instructor of an approved continuing education course may receive credit for the mortgage originator's own annual continuing education requirement at the rate of 2 hours' credit for every 1 hour taught.
(e) Successful completion of the continuing education requirements approved by the Nationwide Multistate Licensing System and Registry for any state shall be accepted as credit towards completion of the continuing education requirements in New Hampshire.
(f) A licensed mortgage loan originator who subsequently becomes unlicensed must complete the continuing education requirements for the last year in which the license was held prior to issuance of a new or renewed license.
IV-f. (a) Mortgage originators who hold a valid New Hampshire mortgage originator's license on July 30, 2016 shall complete all the requirements of paragraphs IV-b, IV-c, IV-d, and IV-e prior to renewal of their licenses for the 2017 calendar year.
(b) The commissioner may by order establish interim procedures for licensing and acceptance of applications. For previously registered or licensed individuals, the commissioner may establish expedited review and licensing procedures.
IV-g. In order to fulfill the purposes of this chapter, the commissioner is authorized to establish relationships or contracts with the Nationwide Multistate Licensing System and Registry or other entities designated by the Nationwide Multistate Licensing System and Registry to collect and maintain records and process transaction fees or other fees related to licensees or other persons subject to this chapter.
V. (a) Upon the applicant's filing of the complete application and payment of the required fee, the commissioner shall have, in accordance with RSA 541-A:29, up to 120 days to investigate and determine whether the applicant's financial resources, experience, personnel, and record of past or proposed conduct warrant the public's confidence and the issuance of a license.
(b) The commissioner shall determine whether the mortgage banker or mortgage broker applicant's proposed interest rates and fees are in accordance with the interest rates and fees charged by other first or second mortgage lenders, and whether said rates and fees will promote a free and competitive market.
(c) The applicant's principals shall meet the requirements of 397-A:5, IV-b and 397-A:5, IV-c(a)(1) through (5).
VI. (a) In addition to any other duties imposed upon the commissioner by law, the commissioner shall require mortgage bankers, mortgage brokers, mortgage servicers, and mortgage loan originators to be licensed and registered through the Nationwide Multistate Licensing System and Registry. In order to carry out this requirement, the commissioner is authorized to participate in the Nationwide Multistate Licensing System and Registry. For this purpose, the commissioner may establish by rule, order, or otherwise the procedures, requirements, and standards as necessary, including but not limited to:
(1) Background checks for:
(A) Criminal history through fingerprint or other databases;
(B) Civil or administrative records;
(C) Credit history;
(D) Any other information as deemed necessary by the Nationwide Multistate Licensing System and Registry;
(2) The payment of fees to apply for or renew licenses through the Nationwide Multistate Licensing System and Registry;
(3) The setting or resetting as necessary of renewal or reporting dates; and
(4) Requirements for amending or surrendering a license or any other such activities as the commissioner deems necessary for participation in the Nationwide Multistate Licensing System and Registry.
(b) The commissioner shall establish a process whereby mortgage loan originators may challenge information entered into the Nationwide Multistate Licensing System and Registry by the commissioner.
VII. Licensees shall comply with the provisions of the Home Ownership and Equity Protection Act of 1994, 15 U.S.C. Section 1639 et seq., as amended.
VIII. A license shall not be issued and effective unless the applicant or licensee is licensed or registered in the state where its principal office is located. This paragraph shall not apply to a mortgage loan originator.
IX. Non-federally insured credit unions which employ loan originators, as defined in the S.A.F.E. Mortgage Licensing Act of 2008, Public Law 110-289, Title V, shall register such employees with the Nationwide Multistate Licensing System and Registry by furnishing the information concerning the employees' identities set forth in section 1507(a)(2) of Public Law 110-289, Title V.

Source. 2016, 289:1, eff. Aug. 20, 2016. 2017, 103:2, eff. Aug. 7, 2017; 184:1, eff. Aug. 28, 2017. 2018, 196:14, eff. Aug. 7, 2018; 318:32, eff. Aug. 24, 2018. 2019, 36:6-11, 51, I, eff. May 15, 2019. 2021, 51:6, eff. July 24, 2021.

Section 397-A:6

    397-A:6 License Grant. –
I. If the commissioner determines that the applicant meets the requirements of this chapter, then the commissioner shall forthwith issue a license or licenses permitting the applicant to act as a mortgage originator, mortgage banker, mortgage broker, or mortgage servicer in accordance with the laws of this state. The commissioner may, by order, restrict or impose conditions for a license. Each branch office license and originator license is only in effect when the associated mortgage banker, mortgage broker, or mortgage servicer is licensed in this state. Each branch manager of a location required to be licensed as a branch office under this chapter shall be licensed as a mortgage loan originator. Licensees shall be responsible for the supervision of their employees, agents, loan originators, and branch offices. Licensees shall conduct background checks, including checking the list of entities issued by the Office of Foreign Assets Control (OFAC) whose assets were frozen by executive order on all of their loan originators.
II. No mortgage banker, mortgage broker, or mortgage servicer license shall be issued to any person whose principal place of business is located outside of this state unless that person designates an agent residing within this state for service of process.
III. Each mortgage banker, mortgage broker, or mortgage servicer license issued under the provisions of this chapter shall state the name and address of the principal office of the licensee and, if the license is a branch office license, the name and address of the branch office location for which that license is issued.
IV. If a mortgage banker, mortgage broker, or mortgage servicer licensee is a person other than a natural person, the license issued to it shall entitle all officers, directors, members, partners, trustees, agents, originators, and employees of the licensed corporation, partnership, entity, or trust to make or broker loans; provided that all individuals who engage in the origination process are licensed as originators and that one officer, director, member, partner, employee, or trustee of such person shall be designated in the license application as the individual to be contacted under the provisions of this chapter.
V. If the mortgage banker, mortgage broker, or mortgage servicer licensee is a natural person, the license shall entitle all employees, agents, and originators of the licensee to make or broker loans, provided that all individuals who engage in the origination process are licensed as originators.
VI. A license issued under this chapter shall not be transferable or assignable between persons.

Source. 2016, 289:1, eff. Aug. 20, 2016.

Section 397-A:7

    397-A:7 License Denial or Abandonment; Appeal. –
I. If the commissioner determines that the applicant fails to meet the requirements of this chapter, the commissioner shall, in writing, immediately notify the applicant of that determination.
II. Applicants may appeal a license denial in accordance with RSA 541-A and rules of the commissioner adopted thereunder.
III. Applicants may petition the banking department for a rehearing in accordance with RSA 541 if the decision in an appeal conducted pursuant to paragraph II affirms a denial of a license application.
IV. The commissioner may deem abandoned and withdraw any application for licensure as a mortgage banker, mortgage broker, or mortgage servicer made pursuant to this chapter if the applicant fails to respond in writing within 180 calendar days to a written request from the commissioner requesting a response. Such request shall be sent via certified mail to the last known address of the applicant that is on file with the commissioner.
V. The commissioner may deem abandoned and withdraw any application for licensure as a mortgage loan originator made pursuant to this chapter if the applicant fails to respond in writing within 60 calendar days to a written request from the commissioner requesting a response. Such request shall be sent via certified mail to the last known address of the applicant that is on file with the commissioner.

Source. 2016, 289:1, eff. Aug. 20, 2016. 2019, 36:12, 13, eff. May 15, 2019.

Section 397-A:8

    397-A:8 License Term; Renewal. –
I. Each mortgage banker, mortgage broker, or mortgage servicer license shall remain in force until it has been surrendered, revoked, or suspended, or terminates or expires in accordance with the provisions of this chapter. Each license shall expire on December 31 of each calendar year.
II. If a person holds a valid mortgage banker, mortgage broker, or mortgage servicer license under this section and is in compliance with this chapter and the rules thereunder, such licensee may renew the license by paying the required fee to the banking department on or before December 1 for the ensuing year that begins on January 1. Failure to renew the license shall result in the license terminating on December 31.
III. A mortgage banker, mortgage broker, or mortgage servicer renewal fee of $500 for the principal office license and each branch office license shall be submitted with the application for license renewal.
IV. No application for renewal of a mortgage banker, mortgage broker, or mortgage servicer license shall be denied without reasonable cause and the right of appeal pursuant to RSA 541-A and RSA 541.

Source. 2016, 289:1, eff. Aug. 20, 2016.

Section 397-A:9

    397-A:9 Escrow Accounts. –
I. Any licensee that receives funds from a mortgagor to be held in escrow for payment of taxes and insurance premiums shall pay the taxes and insurance premiums of the mortgagor to the appropriate taxing authority and insurance company in the amount required and at the time such taxes and insurance premiums are due, provided that the licensee has been provided with the tax or insurance bills at least 15 days prior to the date such taxes and insurance premiums are due, and the mortgagor has paid to the licensee the amounts required to be paid into the escrow account, as determined by the licensee, for all amounts scheduled to be paid to the licensee prior to the date such taxes and insurance premiums are due.
II. Each licensee shall, through its own effort and expense, determine and notify the mortgagor of the amounts necessary to be paid into the escrow account to assure that sufficient funds will be available for the payment of such taxes and insurance premiums as of the date such payment is due.
III. If the amount held in the escrow account as of the date such taxes and insurance premiums are due is insufficient to pay the taxes and insurance premiums despite compliance by the mortgagor with RSA 397-A:9, I, the licensee shall pay such taxes and insurance premiums from its own funds. The licensee shall then give the mortgagor the option of paying the deficiency over a period of not less than 12 months. The licensee shall not charge or collect interest on such deficiency during the 12-month period.
IV. Persons subject to this chapter that require or accept moneys for deposit in escrow accounts maintained for the payment of taxes or insurance premiums related to loans on single family homes secured by real estate mortgages on property located in New Hampshire shall pay interest on the moneys so held in such accounts. During the 6-month period beginning on April 1 of each year, such interest shall be paid at a rate of not less than the National Deposit Rate for Savings Accounts as published in the month of January of the same year by the Federal Deposit Insurance Corporation. During the 6-month period beginning on October 1 of each year, such interest shall be paid at a rate of not less than the National Deposit Rate for Savings Accounts as published in the month of July of the same year by the Federal Deposit Insurance Corporation.

Source. 2016, 289:1, eff. Aug. 20, 2016. 2023, 89:1, eff. June 20, 2023.

Section 397-A:10

    397-A:10 Change in Name; Ownership; Location. –
I. No licensee shall conduct the business of a mortgage banker, mortgage broker, or mortgage servicer under a trade name or any other name different from the name stated in its principal office license or branch office license without immediately notifying the commissioner, who shall then amend the license accordingly.
II. A mortgage banker, mortgage broker, or mortgage servicer licensee shall submit written notification to the department of the addition or deletion of a principal and shall provide the name and address of each new principal no later than 30 days after such change. Each new principal shall authorize the commissioner to conduct a background check. The commissioner shall investigate management and ownership changes including, but not limited to, each principal's qualifications and business history. The licensee shall disclose any injunction or administrative order that has been issued against the principal and whether the principal has been convicted of a misdemeanor involving financial services or a financial services-related business or any fraud, false statements, or omissions, theft or any wrongful taking of property, bribery, perjury, forgery, counterfeiting, extortion, or a conspiracy to commit any of these offenses or convicted of any felony, prior to the commissioner's approval of such change.
III. Mortgage banker, mortgage broker, or mortgage servicer licensees shall provide written notice to the banking department of any proposed change in location or proposed closing of any licensed office no later than 10 business days prior to the effective date of such change of location or closing, unless such change of location or closing occurs under circumstances beyond the control of the licensee whereby such written notice shall be provided within 10 business days from the date the licensee becomes aware of the closing or relocation. Failure to comply with the provisions of this paragraph may be deemed sufficient cause for license revocation or denial of license renewal applications.
IV. Persons licensed under this chapter are under a continuing obligation to update information on file with the commissioner. If any information filed with the commissioner becomes materially inaccurate, the licensee must promptly submit to the commissioner an amendment to its application records that will correct the information on file with the commissioner. An amendment shall be considered to be filed promptly if the amendment is filed within 30 days of the event that requires the filing of the amendment. Significant events shall be reported to the department in writing within 10 days.

Source. 2016, 289:1, eff. Aug. 20, 2016. 2018, 196:4, eff. Aug. 7, 2018. 2019, 36:14, eff. May 15, 2019.

Section 397-A:10-a

    397-A:10-a License Surrender. –
I. A licensee who ceases to engage in the business of an originator, mortgage broker, mortgage banker, or mortgage servicer at any time for any cause shall file a request to surrender its license to the commissioner within 15 calendar days of such cessation and shall file such additional information as may be required by the department.
II. Surrender of a license shall not take effect until the commissioner deems the surrender process complete.
III. Failure to comply with the provisions of this section and rules adopted under this section shall be cause for denial of future license applications and the imposition of penalties under RSA 397-A:20.

Source. 2016, 289:1, eff. Aug. 20, 2016.

Section 397-A:11

    397-A:11 Record Keeping. –
I. The licensee shall maintain such records as will enable the department to determine whether the licensee's business is in compliance with all applicable federal laws and regulations, the laws and rules of this state, and the orders of the commissioner. Records relating to transactions shall be maintained in a readily accessible location and made available for examination for a period of at least 3 years after the licensee's final transaction on a loan or application file. All other business records, including but not limited to financial records, vendor contracts, communications and internal policies, shall be maintained for at least 3 years or as otherwise prescribed by the commissioner.
II. If the licensee retains a mortgage loan in its loan portfolio or services a loan it originated, an adequate loan payment history for such loan shall be made available to the department upon request.
III. If the commissioner or examiner finds any records to be inadequate, or kept or posted in a manner not in accordance with generally accepted accounting principles, the commissioner may employ experts to reconstruct, rewrite, post, or balance them at the expense of the person being examined if such person has failed to maintain, complete, or correct such records after the commissioner or examiner has given him or her written notice and a reasonable opportunity to do so.
IV. A licensee may maintain its records in electronic format if, upon request, the licensee provides the commissioner with:
(a) A full explanation of the programming of any data storage or communications systems in use; and
(b) Information from any books, records, electronic data processing systems, computers, or any other information storage system in the form requested by the commissioner.

Source. 2016, 289:1, eff. Aug. 20, 2016.

Section 397-A:12

    397-A:12 Examinations. –
I. The banking department may examine the business affairs of any licensee or any other person, whether licensed or not, as it deems necessary to determine compliance with this chapter and the rules adopted pursuant to it and with the Consumer Credit Protection Act, (15 U.S.C. 1601 et seq.) as amended. In determining compliance, the banking department may examine the books, accounts, records, files, and other documents or matters of any licensee or person. The banking department shall have the power to subpoena witnesses and administer oaths in any adjudicative proceedings, and to compel, by subpoena duces tecum, the production of all books, records, files, and other documents and materials relevant to its investigation.
II. For the purpose of discovering violations of this chapter, the banking department may examine, during business hours, the records of any licensee and of any person by whom any such loan is made, whether such person shall be licensed to act, or claim to act, as principal, agent, or other representative, or under, or without the authority of this chapter; and for that purpose, the banking department shall have access to the books, papers, records, files, and vaults of all such persons. The banking department shall also have authority to examine, under oath, all persons whose testimony it may require relative to such loans or business.
III. The affairs and records of every licensee shall be subject at any time to such periodic, special, regular, or other examination by the banking department with or without notice to the licensee. All books, papers, files, related material, and records of assets of the licensee shall be subject to the department's examination and made available immediately upon request.
IV. (a) Licensees shall:
(1) Deliver to the commissioner a list of all New Hampshire consumers who have contracted with the licensee or with whom the licensee is otherwise engaged in business regulated under this chapter, and other requested lists summarizing the business of the licensee within 7 days of receipt of the request; and
(2) Deliver to the commissioner files selected by the commissioner from the list delivered in subparagraph (a)(1), and any other files or documents requested, within 21 days of receipt of the request.
(b) Failure to provide files or documents within the time established by this paragraph shall subject a licensee or person to a fine of $50 per day for each day the files or documents are not produced. Failure to provide files or documents within 60 days after receipt of the request shall be sufficient cause for license revocation, suspension, or denial.
V. Any agent of the banking department may make a thorough examination into the business affairs of each licensee and shall report any violations of law, rule, or standard business practice to the banking department.
VI. The expense of such examination shall be chargeable to and paid by the licensee. The payment shall be calculated by the same method as for payments by institutions for cost of examinations under RSA 383:11.
VI-a. The commissioner may, in his or her discretion, accept all or a part of a report of examination of a mortgage banker, mortgage broker, or mortgage servicer, certified to by the regulatory supervisory official of another state. To avoid unnecessary duplication of examinations and investigations, the commissioner, insofar as he or she deems it practicable in administering this section, may cooperate and share information with the regulators of this state and other states, the Federal Trade Commission, the Department of Housing and Urban Development, other federal regulators, or their successors in conducting examinations and investigations.
VII. In any investigation to determine whether any person has violated or is about to violate this chapter or any rule or order under this chapter, upon the commissioner's finding that the person violated this chapter or a rule or order under this chapter, or the person charged with the violation being found in default, the commissioner shall be entitled to recover the cost of the investigation, in addition to any other penalty provided for under this chapter.
VIII. Every person being examined, and all of the officers, directors, employees, agents, and representatives of such person shall make freely available to the commissioner or his or her examiners, the accounts, records, documents, files, information, assets, and matters in their possession or control relating to the subject of the examination and shall facilitate the examination.
IX. Upon receipt of a written report of examination, the licensee shall have 30 days or such additional reasonable period as the commissioner for good cause may allow, within which to review the report and recommend any changes. If any deficiencies are identified in the report of examination, the licensee shall, within 30 days or such additional reasonable period as the commissioner for good cause may allow, set forth in writing to the department, a detailed plan of corrective action the licensee will pursue to correct any reported deficiencies outlined in the report. The examination will remain open until such time as the department determines that the licensee has appropriately responded to all identified deficiencies.
X. If so requested by the person examined, within the period allowed in paragraph IX, or if deemed advisable by the commissioner without such request, the commissioner shall hold a closed hearing relative to the report and shall not file the report in the department until after such closed hearing and issuance of his or her order thereon. If no such closed hearing has been requested or held, the examination report, with such modifications, if any, as the commissioner deems proper, shall be accepted by the commissioner and filed upon expiration of the review period provided for in paragraph IX. The report shall be accepted and filed within 6 months after the final hearing thereon.
XI. All reports pursuant to this section shall be absolutely privileged and although filed in the department as provided in paragraph X shall nevertheless not be for public inspection. The comments and recommendations of the examiner shall also be deemed confidential information and shall not be available for public inspection.
XII. Each licensee or person subject to this chapter shall make or compile reports or prepare other information as directed by the commissioner in order to carry out the purposes of the chapter including but not limited to:
(a) Accounting compilations;
(b) Information lists and data concerning loan transactions in a format prescribed by the commissioner; and
(c) Such other information deemed necessary to carry out the purposes of the chapter.
XIII. In making any examination or investigation authorized by this chapter, the commissioner may control access to any documents and records of the licensee or person under examination or investigation. The commissioner may take possession of the documents and records or place a person in exclusive charge of the documents and records in the place where they are usually kept. During the period of control, no person shall remove or attempt to remove any of the documents and records except pursuant to a court order or with the consent of the commissioner. Unless the commissioner has reasonable grounds to believe the documents or records of the licensee have been, or are at risk of, being altered or destroyed for purposes of concealing a violation of this chapter, the licensee or owner of the documents and records shall have access to the documents or records as necessary to conduct its ordinary business affairs.
XIV. The authority of this section shall remain in effect, whether a licensee or person subject to this chapter acts or claims to act under any licensing or registration law of this state, or claims to act without such authority.
XV. The authority of this section shall extend to any person who has custody of or control over documents within the jurisdiction of the commissioner including but not limited to title companies and other settlement providers who shall provide loan documents to the commissioner upon request.
XVI. No licensee or person subject to investigation or examination under this section may knowingly and with intent to deceive withhold, abstract, remove, mutilate, destroy, or secrete any books, records, computer records, or other information. Such actions shall be fraud under the chapter.

Source. 2016, 289:1, eff. Aug. 20, 2016. 2017, 103:4, eff. Aug. 7, 2017. 2019, 168:15, eff. Sept. 8, 2019. 2021, 51:2, eff. July 24, 2021.

Section 397-A:12-a

    397-A:12-a Confidentiality. –
I. In order to promote more effective regulation and reduce regulatory burden through supervisory information sharing and except as otherwise provided in the S.A.F.E. Mortgage Licensing Act of 2008, Public Law 110-289, Title V, section 1512, the requirements under any federal law or RSA 383:10-b, RSA 383:10-e, RSA 397-A:12, XI, and RSA 91-A regarding the privacy or confidentiality of any information or material provided to the Nationwide Multistate Licensing System and Registry, and any privilege arising under federal or state law, including the rules of any federal or state court, with respect to such information or material, shall continue to apply to such information or material after the information or material has been disclosed to the Nationwide Multistate Licensing System and Registry. Such information and material may be shared with all state and federal regulatory officials with mortgage industry oversight authority without the loss of privilege or the loss of confidentiality protections provided by federal law or RSA 383:10-b, RSA 383:10-e, RSA 397-A:12, XI, and RSA 91-A.
II. The commissioner is authorized to enter agreements or sharing arrangements with other governmental agencies, the Conference of State Bank Supervisors, the American Association of Residential Mortgage Regulators, or other associations representing governmental agencies.
III. The commissioner shall regularly report violations of this chapter, the rules promulgated under this chapter, and enforcement actions taken under this chapter, and other relevant information, to the Nationwide Multistate Licensing System and Registry subject to the provisions contained in paragraph I.
IV. Information or material that is subject to a privilege or confidentiality under paragraph I of this section shall not be subject to:
(a) Disclosure under any federal or state law governing the disclosure to the public of information held by an officer or an agency of the federal government or the respective state; or
(b) Subpoena or discovery, or admission into evidence, in any private civil action or administrative process, unless with respect to any privilege held by the Nationwide Multistate Licensing System and Registry with respect to such information or material, the person to whom such information or material pertains waives, in whole or in part, in the discretion of such person, that privilege.
V. RSA 383:10-b, RSA 383:10-e, RSA 397-A:12, XI, and RSA 91-A, relating to the disclosure of confidential supervisory information or any information or material described in paragraph I of this section that is inconsistent with paragraph I shall be superseded by the requirements of this section.
VI. This section shall not apply with respect to the information or material relating to the employment history of, and publicly adjudicated disciplinary and enforcement actions against, mortgage loan originators that is included in the Nationwide Multistate Licensing System and Registry for access by the public.

Source. 2016, 289:1, eff. Aug. 20, 2016. 2018, 196:14, eff. Aug. 7, 2018.

Section 397-A:13

    397-A:13 Reporting. –
I. Each mortgage banker, mortgage broker, or mortgage servicer shall submit to the Nationwide Multistate Licensing System and Registry reports of condition, which shall be in such form and shall contain such information as the Nationwide Multistate Licensing System and Registry may require, including but not limited to mortgage call reports and financial statements.
II. Each mortgage banker, mortgage broker, or mortgage servicer shall file, under oath, its financial statement within 90 days from the date of its fiscal year end. The financial statement shall be prepared in accordance with generally accepted accounting principles with appropriate note disclosures. The financial statement shall include a balance sheet, income statement, statement of changes in owners' equity, and a cash flow statement. If the financial statement filed under this section is not audited, a certification statement shall be attached and signed by a duly authorized officer of the licensee. The certification statement shall state that the financial statement is true and accurate to the best of the officer's belief and knowledge.
III. The department shall publish its analysis of information obtained through licensee reporting requirements as a part of the commissioner's annual report.
IV. Any mortgage banker, mortgage broker, or mortgage servicer failing to file the financial statement required by this section within the time prescribed may be required to pay to the department a penalty of $25 for each calendar day the financial statement is overdue up to a maximum penalty of $2,500 per statement.
V. Any mortgage banker, mortgage broker, or mortgage servicer failing to file the mortgage call report required by this section within the time prescribed by the Nationwide Multistate Licensing System and Registry may be required to pay to the department a penalty of $25 for each calendar day the mortgage call report is overdue up to a maximum penalty of $625 per mortgage call report.
VI. The banking department may require additional regular or special reports as it may deem necessary to the proper supervision of mortgage servicer, mortgage banker, mortgage broker, and originator under this chapter.
VII. A document is filed when it is received by the commissioner. If any filing deadline date falls on a weekend or on a New Hampshire state or federal legal holiday, the due date shall be automatically extended to the next business day following such weekend or holiday. Examination expenses, fines, penalties, and other moneys obliged to be paid to the department shall be due and payable within 14 days of receipt of notice by the licensee or other person or at such later time determined by the commissioner.
VIII. Electronic filings, when received by the commissioner, are deemed filed, and are prima facie evidence that a filing has been duly authorized and made by the signatory on the application or document, are admissible in any civil or administrative proceeding under this chapter, and are admissible in evidence in accordance with the rules of superior court in any action brought by the attorney general under this chapter.

Source. 2016, 289:1, eff. Aug. 20, 2016. 2018, 196:14, eff. Aug. 7, 2018. 2021, 194:15, eff. Oct. 9, 2021.

Section 397-A:14

    397-A:14 Lending Practices. –
I. Any first mortgage loan, other than a reverse mortgage, made under the provisions of this chapter shall provide for the computation of interest on a simple interest basis.
II. Interest may be computed either on a 360-day basis with each month containing 30 days, or on a 365-day basis with each month containing the actual number of calendar days in that particular month. Unless otherwise provided in the note, loan payments shall be applied on the scheduled payment date or on the date received.
III. For loans where the payment is applied on the date received, the licensee shall provide to the borrower, at the time the loan application is taken, a separate written disclosure which explains how the payments will be applied.
IV. No person subject to this chapter shall:
(a) Obtain property by fraud or misrepresentation;
(b) Solicit or enter into a contract with a borrower that provides that the person subject to this chapter may earn a fee or commission through "best efforts" to obtain a loan even though no loan is actually obtained for the borrower;
(c) Solicit, advertise, or enter into a contract for specific interest rates, points, or other financing terms unless the terms are actually available at the time of soliciting, advertising, or contracting;
(d) Conduct any business covered by this chapter without holding a valid license as required under this chapter, or assist or aid and abet any person in the conduct of business under this or any other chapter without a valid license as required under this chapter;
(e) Fail to make disclosures as required by this chapter and any other applicable state or federal law including rules and regulations thereunder;
(f) Fail to comply with this chapter or rules or orders promulgated under this chapter, or fail to comply with any other state or federal law, including the rules and regulations thereunder, applicable to any business authorized or conducted under this chapter;
(g) Make, in any manner, any false or deceptive statement or representation with regard to the rates, points, or other financing terms or conditions for a residential mortgage loan, or engage in bait and switch advertising;
(h) Negligently make any false statement or knowingly and willfully make any omission of material fact in connection with any information or reports filed with a governmental agency or the Nationwide Multistate Licensing System and Registry or in connection with any investigation conducted by the commissioner or another governmental agency;
(i) Make any payment, threat, or promise, directly or indirectly, to any person for the purposes of influencing the independent judgment of the person in connection with a residential mortgage loan, or make any payment, threat, or promise, directly or indirectly, to any appraiser of a property, for the purposes of influencing the independent judgment of the appraiser with respect to the value of the property;
(j) Collect, charge, attempt to collect or charge, or use or propose any agreement purporting to collect or charge any fee prohibited by this chapter;
(k) Cause or require a borrower to obtain property insurance coverage in an amount that exceeds the replacement cost of the improvements as established by the property insurer;
(l) Fail to truthfully account for monies belonging to a party to a residential mortgage loan transaction;
(m) Collect an advance fee for a loan modification;
(n) Engage in unfair, deceptive, unethical, or fraudulent business practices;
(o) Instruct, solicit, propose, or cause a person to sign another's signature on any document without legal authority; or
(p) Solicit, accept, or execute any contract or other document related to any transaction that contains any blanks to be filled in after signing or initialing the contract or other document, except for forms authorizing the verification of application information or as otherwise expressly provided in this chapter.
V. Licensees shall ensure that the Nationwide Multistate License System and Registry unique identifier of any person originating a residential mortgage loan shall be clearly shown on the residential mortgage loan application, note, security instrument and any other documents as may be established by rule, regulation, or order of the commissioner.

Source. 2016, 289:1, eff. Aug. 20, 2016. 2018, 196:5, 14, eff. Aug. 7, 2018. 2019, 36:15, eff. May 15, 2019.

Section 397-A:14-a

    397-A:14-a Advertising. –
I. No licensee or other person shall advertise, print, display, publish, distribute, or broadcast or permit to be advertised, printed, displayed, published, distributed, or broadcast in any manner whatsoever any statement or representation with regard to the rates, terms, or conditions for the lending of money under the provisions of this chapter which is false, misleading, or deceptive. Any reference to the amount of a loan shall refer to the original principal amount. Any statement so made of the amount of an installment or the rate or amount of interest charges required for any loan shall comply with the provisions of the federal Consumer Credit Protection Act, (15 U.S.C. 1601 et seq.) as amended.
II. Licensees shall ensure that the Nationwide Multistate License System and Registry unique identifier of any person originating a residential mortgage loan shall be clearly shown on all residential mortgage loan application forms, solicitations or advertisements, including business cards or websites, and any other documents as established by rule, regulation, or order of the commissioner.
III. Copies of any and all such advertising shall be retained by the licensee or other person for a period of 3 years after the first publication, distribution, or broadcast date of such advertising. Advertising files maintained under this section shall be subject to review by the banking department during the course of any examination or investigation undertaken in accordance with this chapter.

Source. 2016, 289:1, eff. Aug. 20, 2016.

Section 397-A:14-b

    397-A:14-b Compliance With Requirements for Funding of Loans at Real Estate Closings. – A mortgage banker, mortgage broker, or mortgage servicer licensee shall comply with the provisions of RSA 477:52 relative to requirements for the funding of loans at real estate closings. At a minimum, a closing requires the delivery of a deed if the transaction is a conveyance, the signing of a note, and the disbursement of the mortgage loan funds.

Source. 2016, 289:1, eff. Aug. 20, 2016.

Section 397-A:15

    397-A:15 Borrower's Rights. –
I. A borrower may pre-pay a first mortgage loan, in whole or in part, at any time. Partial prepayments of principal shall be applied on the due date of the next regularly scheduled payment. Prepayments in full ("payoff") shall be credited on the date received, except as provided under United States Department of Housing and Urban Development regulations.
II. The repayment terms of any loan made under the provisions of this chapter shall be conspicuously and clearly set forth in the note. Any prepayment penalty required of a borrower shall be printed in bold type in the note or in any addendum to the note.
III. The advance collection of interest from a borrower shall only be permitted upon the origination of a mortgage loan and shall be computed on a simple interest per annum basis. Notwithstanding the provisions of RSA 358-K:4-a, prepaid interest shall not be collected for a period of greater than 31 days and such method may be used by the lender to achieve a common loan payment date for all of its loans, such as the first day of the month. Collection and application of a regularly scheduled monthly payment before the due date shall not be considered as the advance collection of interest on a mortgage home loan under this chapter.
IV. No licensee shall refuse a written, reasonable request from an applicant or borrower for a copy of documentation in the licensee's file relative to the borrower's loan.
V. Persons subject to or licensed under this chapter that service mortgage loans on real property located in the state of New Hampshire shall, within 5 days of receipt of a written request, provide a net payoff amount as of a specific date with a daily interest rate charge. Persons who fail to provide a net payoff amount within 5 days of receipt of a written request shall be assessed a fine of $100 per day up to a maximum penalty of $2500 per violation.
VI. In the case of open end loans, the note shall state the annual rate of simple interest, the daily applicable rate of interest, the maximum amount of credit, the payment selected by the borrower, and information as to the method used to compute the monthly payment, the related period or periods of repayment, and the monthly due date.
VII. Upon payment in full of the outstanding principal, interest, and other charges due on a mortgage loan, the holder shall mark plainly the note or a copy thereof with the words "PAID IN FULL" or "CANCELLED" and release or provide the borrower evidence to release any mortgage or security instrument no longer securing any indebtedness to the holder. If the original is retained by the lender, the original shall be returned within a reasonable period of time upon the written request of the borrower.
VIII. A copy of each disclosure and its method and timing of delivery shall be kept by the mortgage broker, mortgage banker, and mortgage servicer.
IX. Mortgage bankers, mortgage brokers, and mortgage servicers shall have a documented methodology, approved by a senior manager, that enables its employees, agents, and originators to make a reasonable determination that the borrower can repay a mortgage loan. The methodology shall reflect all relevant factors that have a bearing on the present and future capacity of the borrower to adequately service the debt. A mortgage banker, mortgage broker, and mortgage originator shall not offer or extend a mortgage loan to a borrower unless a reasonable lender would believe at the time the loan is made that the borrower will be able to make the scheduled payments associated with the loan. The loan file kept by the mortgage banker, mortgage broker, and mortgage originator shall document the analysis used to arrive at that conclusion.
X. A person, or its affiliate, brokering or funding a reverse mortgage shall not participate in, or be associated with, or employ any party that participates in or is associated with, any other financial or insurance activity and a mortgagor shall not be required, directly or indirectly, as a condition of obtaining a mortgage, to purchase any other financial or insurance product.

Source. 2016, 289:1, eff. Aug. 20, 2016. 2019, 36:16, eff. May 15, 2019.

Section 397-A:15-a

    397-A:15-a Consumer Inquiries. –
I. Consumer complaints naming licensees under this chapter, which are filed in writing with the office of the commissioner, shall be forwarded via electronic mail or certified mail to the licensee for response within 10 days of receipt by the department. Licensees shall, within 10 days after receipt of such complaint, send a written acknowledgment thereof to the consumer and the banking department. Not later than 30 days following receipt of such complaint, the licensee shall conduct an investigation of the complaint and either:
(a) Make appropriate corrections in the account of the consumer and transmit to the consumer and the banking department written notification of such corrections, including documentary evidence thereof; or
(b) Transmit a written explanation or clarification to the consumer and the banking department which sets forth, to the extent applicable, the reasons why the licensee believes its actions are correct, including copies of documentary evidence thereof.
II. A licensee who fails to respond to consumer complaints as required by this section within the time prescribed shall pay to the commissioner the sum of $50 for each day such response is overdue. For purposes of this section, the date of transmission shall be the date such response is received by the commissioner.
III. (a) Licensees which, because of extenuating circumstances beyond the control of the licensee, are unable to comply with the time frames prescribed in this section, may make written request to the commissioner for a waiver of such time frames. Waivers shall not be granted or considered unless the request for the waiver:
(1) Is received by the banking department within 20 days following the licensee's receipt of the complaint;
(2) Specifies the reason for the request; and
(3) Specifies a date certain by which the licensee shall comply with the provisions of this section.
(b) Requests for waivers shall be either granted or denied within 5 days of receipt by the banking department.

Source. 2016, 289:1, eff. Aug. 20, 2016. 2018, 207:4, 5, eff. Aug. 7, 2018. 2021, 194:25, eff. Oct. 9, 2021.

Section 397-A:16

    397-A:16 Lender's Rights and Broker's Rights. –
I. Mortgage bankers, mortgage brokers, or mortgage servicers may charge fees and points for services rendered in conjunction with the origination, closing, and servicing of loans. If any fee is collected in advance of the closing of the loan, the mortgage banker or mortgage broker shall provide the borrower with a written explanation of the purpose and disposition of the fee. A mortgage banker or mortgage broker may charge an application fee which may include the direct costs incurred by the mortgage banker or mortgage broker for processing an application, and for a real estate appraisal, a credit bureau report, or income verification, or other third party services.
II. Persons subject to provisions of this chapter shall comply with the provisions of RSA 479, relative to foreclosure.
III. Pursuant to RSA 397-A:3, only mortgage brokers, mortgage bankers, mortgage originators, and mortgage servicers licensed under the provisions of this chapter shall be entitled to compensation for services rendered.
IV. In order to issue rate lock commitments, a licensee shall comply with rules adopted by the commissioner.

Source. 2016, 289:1, eff. Aug. 20, 2016.

Section 397-A:16-a

    397-A:16-a Lender's and Borrower's Rights; Second Mortgage Debt. –
I. The allowable rate of interest computed on the unpaid balance that any person may directly or indirectly charge, take, or receive for a second mortgage loan secured by property which is occupied in whole or in part at the time said loan is made as a home by any obligor on the mortgage debt or by any person granting or releasing any interest under said mortgage shall be the rate agreed upon in the note between borrower and lender, and following the sixth month of any period in which a loan has been in continuous default, not more than 1 1/2 percent per month on any unpaid balances.
II. Notwithstanding any other provision of this chapter, the charges which may be collected on any second mortgage loan made under this chapter for the period beginning 6 months after the originally scheduled final installment date of a loan other than an open-end loan, or for the period beginning 6 months after the final due date of an open-end loan as established by the term applicable to the loan from time to time in accordance with the open-end note or loan agreement and ending with date of payment of the loan in full shall not exceed 18 percent per annum simple interest on the balances outstanding from time to time during said period. If the loan is an open-end loan the borrower's privilege for further loans shall not be reinstated by the licensee where the rate has been reduced under the preceding sentence unless the borrower executes a new open-end loan agreement.
III. The borrower shall have the right to anticipate his or her second mortgage debt in whole or in part upon payment of any prepayment penalty agreed upon between borrower and licensee, provided, however, that any penalty shall be clearly set forth in the loan documents; except that there shall be no penalty charged for prepayment of a second mortgage home loan after the loan has been in existence for 5 years. When an open-end loan agreement providing for advances from time to time by the licensee exists between the borrower and the licensee, monthly loan payments shall be selected by the borrower as stated in the note or open-end agreement.
IV. Unless otherwise provided in the note, second mortgage loan payments shall be applied on the scheduled payment dates. Except where the borrower agrees in writing to a different application of his payments, in cases where partial payments are made, the interest shall be calculated to the time of payments, and such payment shall first be applied to interest, and the balance thereafter remaining, if any, shall be applied to principal. In addition to the interest permitted under this section, the lender may contract for and receive any additional other charge, as defined by RSA 358-K:1, XIII, as may be agreed upon by the lender and the borrower.
V. A licensee may retain any security interest in real property on an open-end loan until the open-end account is terminated, provided that if there is no outstanding balance in the account and there is no commitment by the licensee to make advances, the licensee shall within 10 days following written demand by the borrower deliver to the borrower a release of the mortgage or a request for reconveyance of the deed of trust on the real property taken as security.
VI. The repayment provisions of any second mortgage loan shall be clearly set forth in the loan documentation and finance charges shall be clearly disclosed in accordance with RSA 399-B. Nothing in this chapter shall be deemed to limit any type of mortgage or repayment plan.
VII. For second mortgage loans where the payment is applied on the date received, the licensee shall provide to the borrower, at the time of application for the loan, a separate written disclosure which explains how the payments will be applied.
VIII. Upon payment in full of the outstanding principal, interest, and other charges due on a second mortgage loan, the holder shall plainly mark the note or a copy thereof with the words "PAID IN FULL" or "CANCELLED" and release or provide the borrower evidence to release any mortgage or security instrument no longer securing any indebtedness to the holder. If the original is retained by the lender, the original shall be returned within a reasonable period of time upon the written request of the borrower.
IX. If any note secured by a second mortgage, in the case of loans other than open-end loans, does not among its provisions clearly indicate the principal sums, the rate of interest, the period of the loan and the periodic due dates, if any, of principal and interest or, in the case of open-end loans, if the note does not among its provisions clearly indicate the maximum amount of credit available, the rate of interest, the selected payment, or its manner of determination, and the related period or periods of repayment and the monthly or periodic due dates, then the lender shall have no right to collect interest.
X. If the borrower on a second mortgage loan or his or her authorized representative requests, in writing, the lender to furnish him or her with a copy of the note, the lender shall, within 15 days after receipt of said request, send by certified mail a true copy of said note to the person requesting the same at the address specified in such request. At least 15 days prior to the commencement of any foreclosure proceedings the lender shall send to the borrower by certified mail a statement of his or her intention to foreclose which shall specify the amount of principal, interest and other indebtedness, if any, owing and accruing under the note and mortgage. Failure of the lender to comply with the provisions of this section shall suspend his or her rights until such time as he or she complies with the provisions of this section.
XI. Upon payment of any money by the borrower on a second mortgage loan, the lender shall at the request of the borrower give him or her a receipt stating the date of payment, the amount paid, the amount applicable to interest on the loan and the amount applicable to the principal. Such receipt shall be signed by the lender or the lender's duly authorized representative. If a lender refuses, on written demand sent by certified mail, to give such receipt, the lender shall forfeit all interest on the principal sum.
XII. Any second mortgage loan made in violation of paragraphs I-VIII by any person shall be discharged upon payment or tender by the debtor or any person succeeding to his or her interest in such real estate of the principal sum actually borrowed. Any agreement whereby the borrower waives the benefits of paragraphs I-VIII or releases any rights he or she may have acquired by virtue thereof shall be deemed against public policy and void.

Source. 2016, 289:1, eff. Aug. 20, 2016.

Section 397-A:17

    397-A:17 Violations. –
I. The banking department may issue and serve upon any licensee or person over whom it has jurisdiction a complaint setting forth charges whenever the department is of the opinion that the licensee or person is violating or has violated any provision of this chapter or any rule or order under this chapter.
II. It shall be unlawful for a person not being properly licensed as required by this chapter, to engage in the business of a mortgage banker, mortgage broker, mortgage servicer, or mortgage loan originator.
III. It is unlawful for any person, in connection with the solicitation, offer, processing, underwriting, closing, or servicing of a mortgage loan, directly or indirectly:
(a) To employ any device, scheme, or artifice to defraud;
(b) To make any untrue statement of a material fact or to omit to state a material fact necessary in order to make the statements made, in light of the circumstances under which they are made, not misleading; or
(c) To engage in any act, practice, or course of business which operates or would operate as a fraud or deceit upon any person.
IV. It is unlawful for any person to make or cause to be made in any document filed under this chapter or in any proceeding under this chapter any statement which is, at the time and in the light of the circumstances under which it is made, false or misleading in any material respect or, in connection with such statement, to omit to state a material fact necessary in order to make the statements made, in light of the circumstances under which they are made, not misleading.
V. The commissioner may, after due notice and opportunity for hearing, take action against an applicant, licensee or other person under the jurisdiction of the department upon finding that the person:
(a) Has violated any provision of this chapter or rules or orders thereunder;
(b) Has not met the standards established in this chapter;
(c) Has accepted or processed loan applications transmitted or brokered by a mortgage broker who is not licensed, and is not exempt from licensing, under this chapter;
(d) Has filed an application for licensing which as of its effective date, or as of any date after filing in the case of an order denying effectiveness, was incomplete in any material respect or contained any statement which was, in light of the circumstances under which it was made, false or misleading with respect to any material fact;
(e) Has made a false or misleading statement to the commissioner or has materially misstated information in any reports to the commissioner;
(f) Has made fraudulent misrepresentations, has circumvented or concealed, through whatever subterfuge or device, any of the material particulars or the nature thereof required to be stated or furnished to a borrower under the provisions of this chapter;
(g) Has failed to supervise its agents, originators, processors, underwriters, servicers, managers, or employees;
(h) Is the subject of an order entered within the past 5 years by this state, any other state, or federal regulator denying, suspending or revoking a license or registration;
(i) Is permanently, preliminarily, or temporarily enjoined by any court of competent jurisdiction from engaging in or continuing any conduct or practice involving any aspect of lending or collection activities;
(j) Is not qualified on the basis of such factors as experience, knowledge, and financial integrity;
(k) Has engaged in dishonest or unethical practices in the conduct of the business of making or collecting mortgage loans;
(l) Has violated applicable federal laws or rules thereunder;
(m) Has made an unsworn falsification under RSA 641:3 to the commissioner; or
(n) For other good cause shown.
VI. The commissioner, upon an affirmative finding under paragraph V, may take action in any one or more of the following ways:
(a) Suspend or revoke a license.
(b) Affirm a decision to deny or decline to renew a license.
(c) Order or direct such other affirmative action as the commissioner deems necessary.
(d) Remove or ban from office or employment, including license revocation, any person conducting business under this chapter:
(1) For a violation of this chapter or orders or rules promulgated under this chapter; or
(2) For a violation of federal laws, rules, or regulations; or
(3) If the commissioner determines that such person has been convicted of a felony or misdemeanor that would preclude licensing under this chapter; or
(4) If by a preponderance of evidence the commissioner determines that the person no longer demonstrates the financial responsibility, character, and general fitness such as to command the confidence of the community and to warrant a determination that the person subject to the chapter will operate honestly, fairly, and efficiently within the purposes of the chapter.
(e) Assess penalties as provided in RSA 397-A:20.

Source. 2016, 289:1, eff. Aug. 20, 2016. 2017, 103:7, eff. Aug. 7, 2017.

Section 397-A:18

    397-A:18 Order to Show Cause. –
I. The commissioner may issue an order requiring a person to whom any license has been granted or any person under the commissioner's jurisdiction to show cause why the license should not be revoked or suspended, or penalties imposed, or both, for violations of this chapter.
II. (a) The order shall give notice of the facts or conduct constituting the basis for the order and shall afford the opportunity for a hearing.
(b) Valid delivery of such order shall be by hand or certified mail to an officer, director, 5 percent or more owner, member, partner, or legal representative of the licensee or respondent at the last known address of the principal office.
(c) A hearing, if requested shall be scheduled within 10 calendar days after a written request for such hearing is received by the commissioner.
(d) The commissioner shall enter an order making such disposition of the matter as the facts require within 20 calendar days of submission of the evidence into the record.
(e) If the licensee or respondent fails to appear at a hearing after being duly notified, or cannot be located after a reasonable search, such person shall be deemed in default and the proceeding may be decided against the person upon consideration of the order to show cause or other order, the allegations of which may be deemed to be true.
(f) If the person to whom an order to show cause or other order is issued fails to request a hearing within 30 calendar days of receipt or valid delivery of the order and no hearing is ordered by the commissioner, then such person shall be deemed in default and the order shall, on the thirty-first day, become permanent, and shall remain in full force and effect until and unless later modified or vacated by the commissioner, for good cause shown.
III. If the commissioner finds that protection of consumers, lenders, or investors requires emergency action and incorporates a finding to that effect in his or her order, the commissioner may order immediate suspension of a license pending an adjudicative proceeding in accordance with RSA 541-A:30, III. The department shall commence the hearing not later than 10 business days after the date of the order suspending the license. The licensee may waive the 10-day commencement requirement to allow for additional time to prepare for the hearing. If the licensee waives the requirement, the license shall remain suspended until the completion of the hearing. A record of the proceeding shall be made by a certified court reporter provided by the department. Unless expressly waived by the licensee, the commissioner's failure to commence an adjudicative proceeding within 10 business days shall mean that the suspension order is automatically vacated. The commissioner shall not again suspend the license for the same conduct which formed the basis of the vacated suspension without granting the licensee prior notice and an opportunity for an adjudicative proceeding.
IV. If a licensee is a partnership, association, corporation, or entity however organized, it shall be sufficient cause for the suspension or revocation of a license that any officer, director, or trustee of a licensed association or corporation or any member of a licensed partnership has so acted or failed to act on behalf of said licensee as would be cause for suspending or revoking a license to such party as an individual. Each licensee shall be responsible for supervision of its branch offices and for the acts of any or all of its employees, agents, and originators while acting as its agent if such licensee, after actual knowledge of said acts, retained the benefits, proceeds, profits, or advantages accruing from said acts or otherwise ratified said acts.
V. If the commissioner finds that any licensee or applicant for license is no longer in existence or has ceased to do business as a mortgage broker, mortgage banker, mortgage servicer, or mortgage originator, or cannot be located after reasonable search, the commissioner may by order revoke the license, impose penalties, or deny the application.
VI. An action to enforce any provision of this chapter shall be commenced within 6 years after the date on which the violation occurred.

Source. 2016, 289:1, eff. Aug. 20, 2016. 2019, 36:17, eff. May 15, 2019.

Section 397-A:19

    397-A:19 Cease and Desist. –
I. The commissioner may issue a cease and desist order against any licensee or person who it has reasonable cause to believe is in violation of the provisions of this chapter or any rule or order under this chapter. The order shall give notice of the facts or conduct constituting the basis for the order and shall give notice of the opportunity for a hearing. Delivery of such order shall be by hand or certified mail at the last known address of the principal office of the licensee or other person.
II. A hearing shall be held not later than 10 days after the request for such hearing is received by the commissioner. Within 20 calendar days of submission of the evidence into the record, the commissioner shall issue a further order vacating the cease and desist order or making it permanent as the facts require. All hearings shall comply with RSA 541-A.
III. If the person to whom a cease and desist order is issued fails to request a hearing within 30 calendar days of receipt of such order, then such person shall be deemed in default, and the order shall, on the thirty-first day, become permanent, and shall remain in full force and effect until and unless later modified or vacated by the commissioner, for good cause shown.
IV. If the person to whom a cease and desist order is issued fails to appear at the hearing after being duly notified, such person shall be deemed in default, and the proceeding may be determined against him or her upon consideration of the cease and desist order, the allegations of which may be deemed to be true.
V. Upon an affirmative finding of violation, the commissioner may, in addition to ordering a person to cease and desist the conduct at issue, assess penalties as provided in RSA 397-A:20.

Source. 2016, 289:1, eff. Aug. 20, 2016.

Section 397-A:20

    397-A:20 Penalties. –
I. Any person who violates any provision of this chapter shall be guilty of a misdemeanor for each violation if a natural person, or guilty of a felony if any other person.
I-a. Any person who willfully violates any provisions of RSA 397-A:17, III or IV or a cease and desist order or injunction issued pursuant to RSA 397-A:19 shall be guilty of a class B felony. Each of the acts specified shall constitute a separate offense and a prosecution or conviction for any one of such offenses shall not bar prosecution or conviction of any other offense.
II. Any person who knowingly violates any provision of this chapter, rule, or order of the commissioner may, upon notice and opportunity for hearing, except where another penalty is expressly provided, be subject to suspension or revocation of any registration or license, or imposition of an administrative fine not to exceed $2,500 for each violation in lieu of or in addition to suspension or revocation, as may be applicable under this title, for violation of the provision to which such rule or order relates. Each of the acts specified shall constitute a separate violation.
III. Any person who negligently violates any provision of this chapter, rule, or order of the commissioner may, upon notice and opportunity for hearing, except where another penalty is expressly provided, be subject to suspension, revocation, or denial of any registration or license, including the forfeiture of any application fee, or the imposition of an administrative fine not to exceed $1,500 for each violation, in lieu of or in addition to suspension or revocation, as may be applicable under this title, for violation of the provision to which such rule or order relates. Each of the acts specified shall constitute a separate violation.
IV. Every person who directly or indirectly controls a person liable under this section, every partner, principal executive officer or director of such person, every person occupying a similar status or performing a similar function, every employee of such person who materially aids in the act constituting the violation, and every licensee or person acting as a common law agent who materially aids in the acts constituting the violation, either knowingly or negligently, may, upon notice and opportunity for hearing, and in addition to any other penalty provided for by law, be subject to suspension, revocation, or denial of any registration or license, including the forfeiture of any application fee, or the imposition of an administrative fine not to exceed $2,500, or both. Each of the acts specified shall constitute a separate violation, and such administrative action or fine may be imposed in addition to any criminal or civil penalties imposed. No person shall be liable under this paragraph who shall sustain the burden of proof that such person did not know, and in the exercise of reasonable care could not have known, of the existence of facts by reason of which the liability is alleged to exist.
V. The attorney general on the commissioner's behalf, may, with or without prior administrative action by the commissioner, bring an action against any person in any superior court in this state to enjoin the acts or practices of such person and to enforce compliance with this chapter or any rule or order under this chapter. Upon a proper showing, a permanent or temporary injunction, bar, restraining order, or writ of mandamus shall be granted and a receiver may be appointed for the defendant or the defendant's assets. The court shall not require the commissioner or attorney general to post a bond. The court shall have the power to enforce obedience to such injunction, in addition to all of the court's customary powers, by a fine not exceeding $10,000 or by imprisonment, or both. In a proceeding in superior court under this paragraph where the state prevails, the commissioner and the attorney general shall be entitled to recover all costs and expenses of investigation, and the court shall include the costs in its final judgment.
VI. Any licensee that violates any provision of RSA 397-A:9 shall be liable to the mortgagor for:
(a) Any penalties, interest, or other charges levied by the taxing authority or insurance company as a result of such violation; and
(b) Any actual damages suffered by the mortgagor as a result of such violation, including, but not limited to, late payment penalties and associated interest, and any amount which would have been paid by an insurer for a casualty or liability claim had the insurance policy not been canceled for nonpayment by the mortgage servicing company; and
(c) In the case of any successful action to enforce the foregoing liability, the costs of the action together with reasonable attorney's fees as determined by the court.
VII. After notice and opportunity for hearing, the commissioner may enter an order of rescission, restitution, or disgorgement of profits directed to a person who has violated this chapter, or a rule or order under this chapter. Rescission, restitution, or disgorgement of profits shall be in addition to any other penalty provided for under this chapter or RSA 383:10-d.
VIII. In addition to any other penalty provided for under this chapter, after notice and opportunity for hearing, the commissioner may assess fines and penalties against a mortgage loan originator in an amount not to exceed $25,000 if the commissioner finds that such loan originator has violated or failed to comply with any requirement of the S.A.F.E. Mortgage Licensing Act of 2008, Public Law 110-289, Title V, or any regulation or order issued thereunder. Each of the acts specified shall constitute a separate violation.

Source. 2016, 289:1, eff. Aug. 20, 2016.

Section 397-A:21

    397-A:21 Receivership; Liquidation. – The provisions of RSA 395 shall apply to all entities licensed under this chapter insofar as such provisions are applicable.

Source. 2016, 289:1, eff. Aug. 20, 2016.

Section 397-A:22

    397-A:22 Administration by Commissioner; Rulemaking. –
I. The commissioner shall administer and enforce the provisions of this chapter.
II. Pursuant to RSA 541-A, the commissioner may adopt such rules as he or she deems necessary to the administration and enforcement of this chapter. Such rules shall be consistent with the provisions of this chapter, and may include, but shall not be limited to, the following:
(a) The application form for licensees required under RSA 397-A:5.
(b) The form of license issued to licensees under RSA 397-A:6.
(c) Reports required by RSA 397-A:13.
(d) Personal disclosure statements to meet the requirements of RSA 397-A:5.
(e) Fees to be charged to cover the reasonable costs of copying documents and producing reports.
III. The commissioner may prepare, alter, or withdraw such forms as are necessary to comply with the provisions of this title.
IV. The commissioner may issue, amend, or rescind such orders as are reasonably necessary to carry out the provisions of this chapter.
V. The commissioner may, for good cause shown, abate all or a portion of fees or delinquency penalties assessed under this chapter.
VI. All actions taken by the commissioner pursuant to this chapter shall be taken only when the commissioner finds such action necessary or appropriate to the public interest or for the protection of consumers and consistent with the purposes fairly intended by the policy and provisions of this title.
VII. In adopting rules, preparing forms, setting standards, and in performing examinations, investigations, and other regulatory functions authorized by the provisions of this chapter, the commissioner may cooperate, and share information pursuant to confidentiality agreements, with regulators in this state and with regulators in other states and with federal regulators in order to implement the policy of this chapter in an efficient and effective manner and to achieve maximum uniformity in the form and content of applications, reports, and requirements for mortgage bankers, mortgage brokers, and mortgage servicers, where practicable.
VIII. The commissioner may share information with state and federal law enforcement agencies for the purposes of criminal investigations.

Source. 2016, 289:1, eff. Aug. 20, 2016.

Section 397-A:23

    397-A:23 Severability. – If any provision of this chapter or the application thereof to any person or circumstance is held invalid, the remainder of the chapter or the application of the provision to other persons or circumstances is not affected and to this end the provisions of this chapter are severable.

Source. 2016, 289:1, eff. Aug. 20, 2016.