(1) As used in this subchapter:(1) “Affiliate” means a person that directly or indirectly through one (1) or more intermediaries controls, is controlled by, or is under common control with the person;(2) (A) “Allowable assets for liquidity” means assets that may be used to satisfy liquidity requirements under this subchapter.(B) “Allowable assets for liquidity” includes without limitation:(i) Unrestricted cash and cash equivalents; and(ii) Unencumbered investment-grade assets held for sale or trade;(3) “Applicant” means a person that has applied to become licensed under this subchapter as a loan officer, transitional loan officer, mortgage broker, mortgage banker, or mortgage servicer;(4) “Authorized user” means an employee, contractor, agent, or other person that participates in a financial institution's business operations and is authorized to access and use a financial institution's information systems and data;(5) “Board of directors” means a formal body that is responsible for corporate governance and compliance with this subchapter;(6) “Branch manager” means the individual who is in charge of the business operations of one (1) or more branch offices of a mortgage broker, mortgage banker, or mortgage servicer;(7) “Branch office” means a location that is separate and distinct from the licensee's principal place of business and includes any location from which business is conducted under the license or in the name of the mortgage broker, mortgage banker, or mortgage servicer:(A) The address of which appears on business cards, stationery, or advertising used by the licensee in connection with business conducted under this subchapter at the branch office;(B) At which the licensee's name, advertising, promotional materials, or signage suggests that mortgage loans are originated, solicited, accepted, negotiated, funded, or serviced or from which mortgage loan commitments or interest rate guarantee agreements are issued; or(C) Which, due to the actions of any employee, associate, loan officer, or transitional loan officer of the licensee, may be construed by the public as a branch office of the licensee where mortgage loans are originated, solicited, accepted, negotiated, funded, or serviced or from which mortgage loan commitments or interest rate guarantee agreements are issued;(8) “Commissioner” means the Securities Commissioner and includes the commissioner's designees;(9) “Consumer” means an individual or that individual's legal representative who obtains or has obtained a financial product or service from a financial institution that is to be used primarily for personal, family, or household purposes;(10) “Consumer report” means the same as defined in the Fair Mortgage Lending Act, 15 U.S.C. § 1681 et seq., as it existed on January 1, 2025;(11) (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.(B) A person is presumed to control a company if the person:(i) Is a director, general partner, or executive officer of the company;(ii) Directly or indirectly has the right to vote twenty-five percent (25%) or more of a class of a voting security of the company or has the power to sell or direct the sale of twenty-five percent (25%) or more of a class of voting securities of the company;(iii) In the case of a limited liability company, is a managing member of the limited liability company; or(iv) In the case of a partnership, has the right to receive upon dissolution or has contributed ten percent (10%) or more of the capital of the partnership;(12) “Control affiliate” means a partnership, corporation, trust, limited liability company, or other organization that directly or indirectly controls or is controlled by the applicant;(13) “Control person” means an individual who directly or indirectly exercises control over the applicant;(14) (A) “Corporate governance” means the structure of and how the licensee is managed.(B) “Corporate governance” includes the corporate rules, policies, processes, and practices used to oversee and manage a licensee;(15) (A) “Covered institution servicer” means a nonbank mortgage servicer that:(i) As reported in the mortgage call report, services:(a) Portfolios of two thousand (2,000) or more of one (1) to four (4) unit residential mortgage loans serviced or subserviced for others, excluding whole loans owned; and(b) Loans being interim serviced before sale as of the most recent calendar year end; and(ii) Operates in two (2) or more states, districts, or territories of the United States either currently or as of the prior calendar year end.(B) “Covered institution servicer” does not include:(i) A person exempt from mortgage servicer licensing requirements under this subchapter;(ii) A mortgage servicer that has the status of a tax-exempt organization under 26 U.S.C. § 501(c)(3), as in effect on January 1, 2025; or(iii) A mortgage servicer solely owning or conducting reverse mortgage servicing, or both, or the reverse mortgage portfolio administered by a large mortgage servicer;(16) “Customer” means a consumer who has a customer relationship with a financial institution;(17) “Customer information” means a record containing nonpublic personal information about a customer of a financial institution, whether in paper, electronic, or other form, that is handled or maintained by or on behalf of a financial institution or the financial institution's affiliates;(18) “Customer relationship” means a continuing relationship between a consumer and a financial institution under which the financial institution provides to the consumer one (1) or more financial products or services that are used primarily for personal, family, or household purposes;(19) “Employee” means an individual who is licensed with or employed by a mortgage broker, mortgage banker, or mortgage servicer, whether by employment contract, agency, or other arrangement and regardless of whether the individual is treated as an employee for purposes of compliance with the federal income tax laws;(20) “Encryption” means the transformation of data into a form that results in a low probability of assigning meaning without the use of a protective process or key, consistent with current cryptographic standards and accompanied by appropriate safeguards for cryptographic key material;(21) (A) “Exempt person” means a person not required to be licensed as a mortgage broker, mortgage banker, mortgage servicer, loan officer, or transitional loan officer under this subchapter.(B) “Exempt person” includes any of the following:(i) An employee of a licensee whose responsibilities are limited to clerical and administrative tasks for his or her employer and who does not solicit borrowers, accept applications, or negotiate the terms of loans on behalf of the employer;(ii) An agency or corporate instrumentality of the federal government or any state, county, or municipal government granting mortgage loans under specific authority of the laws of any state or of the United States;(iii) A trust company or industrial loan company chartered under the laws of Arkansas;(iv) A small-business investment corporation licensed under the Small Business Investment Act of 1958, 15 U.S.C. § 661 et seq., as it existed on January 1, 2025;(v) A real estate investment trust as defined in 26 U.S.C. § 856, as it existed on January 1, 2025;(vi) A state or federally chartered bank, an operating subsidiary of a state-chartered bank regulated by the State Bank Department, a savings bank, a savings and loan association, or a credit union, the accounts of which are insured by the Federal Deposit Insurance Corporation or the National Credit Union Administration;(vii) An agricultural loan organization that is subject to licensing, supervision, or auditing by the United States Farm Service Agency, Commodity Credit Corporation, United States Department of Agriculture Rural Development, United States Farm Credit Administration, or the United States Department of Agriculture;(viii) A nonprofit corporation that:(a) Qualifies as a nonprofit entity under § 501(c)(3) of the Internal Revenue Code;(b) Is not primarily in the business of soliciting or brokering mortgage loans; and(c) Makes or services mortgage loans to promote home ownership or home improvements for the disadvantaged;(ix) (a) A licensed real estate agent or broker who is performing those activities subject to the regulation of the Arkansas Real Estate Commission.(b) Notwithstanding subdivision (21)(B)(ix)(a) of this section, “exempt person” does not include a real estate agent or broker who receives compensation of any kind in connection with the referral, placement, or origination of a mortgage loan;(x) A person who engages in seller-financed transactions or who as a seller of real property receives mortgages, deeds of trust, or other security instruments on real estate as security for a purchase money obligation if:(a) The person does not receive from or hold on behalf of the borrower any funds for the payment of insurance or taxes on the real property; and(b) The seller does not sell the liens or mortgages in the secondary market other than to affiliated or subsidiary persons;(xi) An individual or married couple who provide funds for investment in loans secured by a lien on real property on his or her or their own account and who do not:(a) Charge a fee or cause a fee to be paid for any service other than the normal and scheduled rates for escrow, title insurance, and recording services; and(b) Collect funds to be used for the payment of any taxes or insurance premiums on the property securing the loans;(xii) An attorney licensed in Arkansas rendering legal services to his or her client, when the conduct that would subject the attorney to the jurisdiction of this subchapter is ancillary to the provision of the legal services offered;(xiii) A person performing any act under order of any court;(xiv) A person acting as a mortgage broker, mortgage banker, or mortgage servicer for any person located in Arkansas, if the mortgage broker, mortgage banker, or mortgage servicer has no office or employee in Arkansas and the real property that is the subject of the mortgage is located outside of Arkansas;(xv) An officer or employee of an exempt person described in subdivisions (21)(B)(ii)-(xiv) of this section if acting in the scope of employment for the exempt person; and(xvi) A manufactured or modular home retailer and its employees if:(a) The manufactured or modular home retailer or its employees perform only administrative or clerical tasks on behalf of a person required to be licensed under this subchapter; or(b) The manufactured or modular home retailer and its employees:(1) Do not receive compensation or financial gain for engaging in loan officer activities that exceeds the amount of compensation or financial gain that could be received in a comparable cash transaction for a manufactured home;(2) Disclose to the consumer in writing any corporate affiliation with a mortgage banker;(3) Provide referral information for at least one (1) unaffiliated creditor if the manufactured or modular home retailer has a corporate affiliation with a mortgage banker and the mortgage banker offers a recommendation; and(4) (A) Do not directly negotiate loan terms with the consumer or lender.(B) As used in subdivision (21)(B)(xvi)(b)(4)(A) of this section, “loan terms” includes rates, fees, and other costs;(22) “External audit” means a formal report prepared by an independent certified public accountant expressing an opinion on whether financial statements are:(A) Presented fairly, in all material aspects, according to the applicable financial reporting framework; and(B) Inclusive of an evaluation of the adequacy of a company's internal control structure;(23) “Financial institution” means a mortgage broker, mortgage banker, or mortgage servicer licensed under this subchapter;(24) (A) “Financial product or service” means a product or service that a financial holding company could offer by engaging in a financial activity under section 4(k) of the Bank Holding Company Act of 1956, 12 U.S.C. § 1843(k), as it existed on January 1, 2025.(B) “Financial product or service” includes a financial institution's evaluation or brokerage of information that a financial institution collects in connection with a request or an application from a consumer for a financial product or service;(25) “Information security program” means the administrative, technical, or physical safeguards a financial institution uses to access, collect, distribute, process, protect, store, use, transmit, dispose of, or otherwise handle customer information;(26) “Information system” means a discrete set of electronic information resources organized for the collection, processing, maintenance, use, sharing, dissemination, or disposition of electronic information, including any specialized system, such as an industrial controls system or a process controls system, a telephone switching and private branch exchange system, and an environmental control system, that contain customer information or that is connected to a system that contains customer information;(27) “Interim serviced before sale” means the activity of collecting a limited number of contractual mortgage payments immediately after origination on loans held for sale but before the loans have been sold into the secondary market;(28) “Internal audit” means the internal activity of performing independent, objective assurance, and consulting to evaluate and improve the effectiveness of company operations, risk management, internal controls, and governance processes;(29) (A) “Key individual” means an individual who is ultimately responsible for establishing or directing policies and procedures of a licensee.(B) “Key individual” includes without limitation:(i) An executive officer;(ii) A manager;(iii) A director;(iv) A trustee; or(v) A control person;(30) “Licensee” means a loan officer, transitional loan officer, mortgage broker, mortgage banker, or mortgage servicer that is licensed under this subchapter;(31) (A) “Loan officer” means an individual other than an exempt person described in subdivision (21) of this section who in exchange for compensation as an employee of or who otherwise receives compensation or remuneration from a mortgage broker or a mortgage banker:(i) Solicits or offers to solicit an application for a mortgage loan;(ii) Accepts or offers to accept an application for a mortgage loan;(iii) Negotiates or offers to negotiate the terms or conditions of a mortgage loan;(iv) Issues or offers to issue a mortgage loan commitment or interest rate guarantee agreement; or(v) Provides or offers to provide modification of a mortgage loan.(B) “Loan officer” does not include:(i) An individual who performs clerical or administrative tasks in the processing of a mortgage loan at the direction of and subject to the supervision and instruction of a licensed loan officer;(ii) An underwriter if the individual performs no activities under subdivision (31)(A) of this section; or(iii) An individual who is solely involved in extensions of credit relating to timeshare plans, as that term is defined in 11 U.S.C. § 101(53D), as it existed on January 1, 2025;(32) “Make a mortgage loan” means to close a mortgage loan, to advance funds, to offer to advance funds, or to make a commitment to advance funds to a borrower under a mortgage loan;(33) (A) “Managing principal” means a person who meets the requirements of § 23-39-508 and who agrees to be primarily responsible for the operations of a licensed mortgage broker, mortgage banker, or mortgage servicer.(B) “Managing principal” includes a qualifying individual;(34) “Mortgage banker” means a person who engages in the business of making mortgage loans for compensation or other gain;(35) “Mortgage broker” means a person who for compensation or other gain or in the expectation of compensation or other gain and, regardless of whether the acts are done directly or indirectly, through contact by telephone, by electronic means, by mail, or in person with the borrowers or potential borrowers:(A) Accepts or offers to accept an application for a mortgage loan;(B) Solicits or offers to solicit an application for a mortgage loan;(C) Negotiates or offers to negotiate the terms or conditions of a mortgage loan; or(D) Issues or offers to issue mortgage loan commitments or interest rate guarantee agreements to borrowers;(36) “Mortgage call report” means a quarterly or annual report of residential real estate loan origination, servicing, and financial information completed by a company licensed through the Nationwide Multistate Licensing System and Registry;(37) (A) “Mortgage loan” means a loan primarily for personal, family, or household use that is secured by a mortgage, deed of trust, reverse mortgage, or other equivalent consensual security interest encumbering:(i) A dwelling as defined in section 1602(w) of the Truth in Lending Act, 15 U.S.C. § 1601 et seq., as it existed on January 1, 2025; or(ii) Residential real estate upon which is constructed or intended to be constructed a dwelling.(B) “Mortgage loan” includes a residential mortgage loan;(38) (A) “Mortgage servicer” means:(i) An entity performing the routine administration of a residential mortgage loan on behalf of an owner of the related mortgage under the terms of a servicing contract; or(ii) A person that receives or has the right to receive from or on behalf of a borrower:(a) Funds or credits in payment for a mortgage loan; or(b) The taxes or insurance associated with a mortgage loan.(B) In the case of a home equity conversion mortgage or a reverse mortgage, “mortgage servicer” includes a person that makes a payment to the borrower;(39) “Mortgage servicing rights” means the contractual right to service residential mortgage loans on behalf of the owner of the associated mortgage in exchange for specified compensation according to a servicing contract;(40) (A) “Mortgage trigger lead” means a lead resulting from a consumer report obtained under 15 U.S.C. § 1681b, as it existed on January 1, 2025, if the issuance of the consumer report is triggered by an inquiry made with a consumer reporting agency in response to an application for credit.(B) “Mortgage trigger lead” does not include a consumer report obtained by a lender that holds or services existing indebtedness of the applicant who is the subject of the consumer report;(41) “Multifactor authentication” means authentication through verification of at least two (2) of the following types of authentication factors:(A) Knowledge factors, including without limitation a password;(B) Possession factors, including without limitation a token; or(C) Inherence factors, including without limitation biometric characteristics;(42) (A) “Nonpublic personal information” means:(i) Personally identifiable financial information; and(ii) A list, description, or other grouping of consumers, and publicly available information pertaining to a consumer, that is derived using personally identifiable financial information that is not publicly available.(B) “Nonpublic personal information” includes without limitation a list of individuals' names and street addresses that is derived in whole or in part using personally identifiable financial information that is not publicly available.(C) “Nonpublic personal information” does not include:(i) Publicly available information except as included on a list described in subdivision (42)(A)(ii) of this section;(ii) A list, description, or other grouping of consumers, and publicly available information pertaining to the list, description, or other grouping of consumers, that is derived without using personally identifiable financial information that is not publicly available; or(iii) A list of individuals' names and addresses that contains only publicly available information and is not: (a) Derived, in whole or in part, using personally identifiable financial information that is not publicly available; and (b) Disclosed in a manner that indicates that any of the individuals on the list is a consumer of a financial institution;(43) (A) “Notification event” means acquisition of unencrypted customer information without the authorization of the customer to which the customer information pertains.(B) For purposes of subdivision (43)(A) of this section:(i) Customer information is considered unencrypted if the encryption key was accessed by an unauthorized person; and(ii) Unauthorized acquisition is presumed to include unauthorized access to unencrypted customer information unless a financial institution has reliable evidence showing that there has not been, or could not reasonably have been, unauthorized acquisition of the customer information;(44) “Operating liquidity” means the funds necessary to perform normal business operations, including payment of rent, salaries, interest expense, and other typical expenses associated with operating an entity;(45) “Operating subsidiary” means a separate corporation, limited liability company, or similar entity in which a national or state bank, savings and loan association, or credit union, the accounts of which are insured by the Federal Deposit Insurance Corporation or the National Credit Union Administration, maintains more than fifty percent (50%) voting rights, a controlling interest, or otherwise controls the subsidiary and no other party controls more than fifty percent (50%) of the voting rights or a controlling interest in the subsidiary;(46) “Penetration testing” means a test methodology in which assessors attempt to circumvent or defeat the security features of an information system by attempting penetration of databases or controls from outside or inside a financial institution's information system;(47) “Person” means an individual, partnership, limited liability company, limited partnership, corporation, association, or other group engaged in joint business activities, however organized;(48) (A) “Personally identifiable financial information” means information:(i) A consumer provides to a financial institution to obtain a financial product or service from a financial institution;(ii) About a consumer resulting from a transaction involving a financial product or service between a financial institution and a consumer; or(iii) A financial institution otherwise obtains about a consumer in connection with providing a financial product or service to that consumer.(B) “Personally identifiable financial information” includes:(i) Information a consumer provides to a financial institution on an application to obtain a loan, credit card, or other financial product or service;(ii) Account balance information, payment history, overdraft history, and credit or debit card purchase information;(iii) The fact that an individual is or has been a financial institution's customer or has obtained a financial product or service from a financial institution;(iv) Information about a financial institution's consumer if the information is disclosed in a manner that indicates that the individual is or has been the financial institution's consumer;(v) Information that a consumer provides to a financial institution or that a financial institution or a financial institution's agent otherwise obtains in connection with collecting on or servicing a credit account;(vi) Information a financial institution collects through an internet cookie or an information collecting device from a computer server; and(vii) Information from a consumer report.(C) “Personally identifiable financial information” does not include:(i) A list of names and addresses of customers of an entity that is not a financial institution; and(ii) Information that does not identify a consumer, including aggregate information or blind data that does not contain personal identifiers such as account numbers, names, or addresses;(49) “Principal place of business” means a stationary construction consisting of at least one (1) enclosed room or building in which negotiations of mortgage loan transactions of others may be conducted in private or in which the primary business functions of the licensee are conducted;(50) (A) “Publicly available information” means information that a financial institution has a reasonable basis to believe is lawfully made available to the public from:(i) Federal, state, or local government records;(ii) Widely distributed media; or(iii) Disclosures to the public that are required to be made by federal, state, or local law.(B) “Publicly available information” includes without limitation:(i) Information in government records, including information in government real estate records and security interest filings; and(ii) (a) Information from widely distributed media, including information from a telephone book, television or radio program, newspaper, or website that is available to the public on an unrestricted basis. (b) A website is not restricted under subdivision (50)(B)(ii)(a) of this section merely because an internet service provider or a site operator requires a fee or a password, so long as access is available to the public.(C) For purposes of this subdivision (50), a financial institution has a reasonable basis to believe that:(i) Information is lawfully made available to the public if the financial institution has taken steps to determine: (a) That the information is of the type that is available to the public; and (b) Whether an individual can direct that the information not be made available to the public and, if so, that the financial institution's consumer has not directed that the information not be made available to the public;(ii) Mortgage information is lawfully made available to the public if the financial institution determines that the mortgage information is of the type included on the public record in the jurisdiction where the mortgage would be recorded; and(iii) An individual's telephone number is lawfully made available to the public if the financial institution has located the telephone number in a telephone directory or the consumer has informed the financial institution that the telephone number is not unlisted;(51) “Qualified individual” means an individual designated by a financial institution to oversee, implement, and enforce the financial institution's information security program;(52) “Residential mortgage loans serviced” means a specific portfolio or portfolios of residential mortgage loans for which a licensee is contractually responsible to the owner or owners of the mortgage loans for the defined servicing activities;(53) “Reverse mortgage” means a nonrecourse loan that pays a homeowner loan proceeds drawn from accumulated home equity;(54) “Risk management assessment” means the functional evaluations performed under the risk management program and reports provided to a board of directors under a relevant governance protocol;(55) “Risk management program” means the policies and procedures designed to identify, measure, monitor, and mitigate risk sufficient for the level of sophistication of a covered institution servicer;(56) “Security event” means an event resulting in unauthorized access to, or disruption or misuse of:(A) An information system or information stored on the information system; or(B) Customer information held in physical form;(57) “Service provider” means a person or entity that receives, maintains, processes, or otherwise is permitted access to customer information through its provision of services directly to a financial institution that is subject to this subchapter;(58) “Servicing liquidity” means the financial resources necessary to manage liquidity risk arising from servicing functions required in acquiring and financing mortgage servicing rights, hedging costs, and margin calls associated with the mortgage servicing rights asset and financing facilities and advances or costs of advance financing for principal, interest, taxes, insurance, and any other servicing-related advances;(59) “Sponsor” means a mortgage broker or mortgage banker licensed under this subchapter that has assumed the responsibility for and agrees to supervise the actions of a loan officer or transitional loan officer;(60) “Tangible net worth” means the total equity less:(A) The receivables due from related entities;(B) Goodwill and other intangibles; and(C) Pledged assets;(61) “Transitional loan officer” means an individual who, in exchange for compensation as an employee of, or who otherwise receives compensation or remuneration from, a mortgage broker or a mortgage banker, is authorized to act as a loan officer subject to a transitional loan officer license;(62) “Transitional loan officer license” means a license that:(A) Is issued to an individual who is employed and sponsored by a mortgage banker or mortgage broker licensed under this subchapter;(B) Is limited to a term of no more than one hundred twenty (120) days; and(C) Is not subject to reapplication, renewal, or extension by the commissioner;(63) “Unique identifier” means a number or other identifier assigned by protocols established by the automated licensing system approved by the commissioner; and(64) “Whole loans” mean those loans in which a mortgage and the underlying credit risk is owned and held on the balance sheet of an entity with all ownership rights.
(1) “Affiliate” means a person that directly or indirectly through one (1) or more intermediaries controls, is controlled by, or is under common control with the person;
(2) (A) “Allowable assets for liquidity” means assets that may be used to satisfy liquidity requirements under this subchapter.(B) “Allowable assets for liquidity” includes without limitation:(i) Unrestricted cash and cash equivalents; and(ii) Unencumbered investment-grade assets held for sale or trade;
(A) “Allowable assets for liquidity” means assets that may be used to satisfy liquidity requirements under this subchapter.
(B) “Allowable assets for liquidity” includes without limitation:(i) Unrestricted cash and cash equivalents; and(ii) Unencumbered investment-grade assets held for sale or trade;
(i) Unrestricted cash and cash equivalents; and
(ii) Unencumbered investment-grade assets held for sale or trade;
(3) “Applicant” means a person that has applied to become licensed under this subchapter as a loan officer, transitional loan officer, mortgage broker, mortgage banker, or mortgage servicer;
(4) “Authorized user” means an employee, contractor, agent, or other person that participates in a financial institution's business operations and is authorized to access and use a financial institution's information systems and data;
(5) “Board of directors” means a formal body that is responsible for corporate governance and compliance with this subchapter;
(6) “Branch manager” means the individual who is in charge of the business operations of one (1) or more branch offices of a mortgage broker, mortgage banker, or mortgage servicer;
(7) “Branch office” means a location that is separate and distinct from the licensee's principal place of business and includes any location from which business is conducted under the license or in the name of the mortgage broker, mortgage banker, or mortgage servicer:(A) The address of which appears on business cards, stationery, or advertising used by the licensee in connection with business conducted under this subchapter at the branch office;(B) At which the licensee's name, advertising, promotional materials, or signage suggests that mortgage loans are originated, solicited, accepted, negotiated, funded, or serviced or from which mortgage loan commitments or interest rate guarantee agreements are issued; or(C) Which, due to the actions of any employee, associate, loan officer, or transitional loan officer of the licensee, may be construed by the public as a branch office of the licensee where mortgage loans are originated, solicited, accepted, negotiated, funded, or serviced or from which mortgage loan commitments or interest rate guarantee agreements are issued;
(A) The address of which appears on business cards, stationery, or advertising used by the licensee in connection with business conducted under this subchapter at the branch office;
(B) At which the licensee's name, advertising, promotional materials, or signage suggests that mortgage loans are originated, solicited, accepted, negotiated, funded, or serviced or from which mortgage loan commitments or interest rate guarantee agreements are issued; or
(C) Which, due to the actions of any employee, associate, loan officer, or transitional loan officer of the licensee, may be construed by the public as a branch office of the licensee where mortgage loans are originated, solicited, accepted, negotiated, funded, or serviced or from which mortgage loan commitments or interest rate guarantee agreements are issued;
(8) “Commissioner” means the Securities Commissioner and includes the commissioner's designees;
(9) “Consumer” means an individual or that individual's legal representative who obtains or has obtained a financial product or service from a financial institution that is to be used primarily for personal, family, or household purposes;
(10) “Consumer report” means the same as defined in the Fair Mortgage Lending Act, 15 U.S.C. § 1681 et seq., as it existed on January 1, 2025;
(11) (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.(B) A person is presumed to control a company if the person:(i) Is a director, general partner, or executive officer of the company;(ii) Directly or indirectly has the right to vote twenty-five percent (25%) or more of a class of a voting security of the company or has the power to sell or direct the sale of twenty-five percent (25%) or more of a class of voting securities of the company;(iii) In the case of a limited liability company, is a managing member of the limited liability company; or(iv) In the case of a partnership, has the right to receive upon dissolution or has contributed ten percent (10%) or more of the capital of the partnership;
(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.
(B) A person is presumed to control a company if the person:(i) Is a director, general partner, or executive officer of the company;(ii) Directly or indirectly has the right to vote twenty-five percent (25%) or more of a class of a voting security of the company or has the power to sell or direct the sale of twenty-five percent (25%) or more of a class of voting securities of the company;(iii) In the case of a limited liability company, is a managing member of the limited liability company; or(iv) In the case of a partnership, has the right to receive upon dissolution or has contributed ten percent (10%) or more of the capital of the partnership;
(i) Is a director, general partner, or executive officer of the company;
(ii) Directly or indirectly has the right to vote twenty-five percent (25%) or more of a class of a voting security of the company or has the power to sell or direct the sale of twenty-five percent (25%) or more of a class of voting securities of the company;
(iii) In the case of a limited liability company, is a managing member of the limited liability company; or
(iv) In the case of a partnership, has the right to receive upon dissolution or has contributed ten percent (10%) or more of the capital of the partnership;
(12) “Control affiliate” means a partnership, corporation, trust, limited liability company, or other organization that directly or indirectly controls or is controlled by the applicant;
(13) “Control person” means an individual who directly or indirectly exercises control over the applicant;
(14) (A) “Corporate governance” means the structure of and how the licensee is managed.(B) “Corporate governance” includes the corporate rules, policies, processes, and practices used to oversee and manage a licensee;
(A) “Corporate governance” means the structure of and how the licensee is managed.
(B) “Corporate governance” includes the corporate rules, policies, processes, and practices used to oversee and manage a licensee;
(15) (A) “Covered institution servicer” means a nonbank mortgage servicer that:(i) As reported in the mortgage call report, services:(a) Portfolios of two thousand (2,000) or more of one (1) to four (4) unit residential mortgage loans serviced or subserviced for others, excluding whole loans owned; and(b) Loans being interim serviced before sale as of the most recent calendar year end; and(ii) Operates in two (2) or more states, districts, or territories of the United States either currently or as of the prior calendar year end.(B) “Covered institution servicer” does not include:(i) A person exempt from mortgage servicer licensing requirements under this subchapter;(ii) A mortgage servicer that has the status of a tax-exempt organization under 26 U.S.C. § 501(c)(3), as in effect on January 1, 2025; or(iii) A mortgage servicer solely owning or conducting reverse mortgage servicing, or both, or the reverse mortgage portfolio administered by a large mortgage servicer;
(A) “Covered institution servicer” means a nonbank mortgage servicer that:(i) As reported in the mortgage call report, services:(a) Portfolios of two thousand (2,000) or more of one (1) to four (4) unit residential mortgage loans serviced or subserviced for others, excluding whole loans owned; and(b) Loans being interim serviced before sale as of the most recent calendar year end; and(ii) Operates in two (2) or more states, districts, or territories of the United States either currently or as of the prior calendar year end.
(i) As reported in the mortgage call report, services:(a) Portfolios of two thousand (2,000) or more of one (1) to four (4) unit residential mortgage loans serviced or subserviced for others, excluding whole loans owned; and(b) Loans being interim serviced before sale as of the most recent calendar year end; and
(a) Portfolios of two thousand (2,000) or more of one (1) to four (4) unit residential mortgage loans serviced or subserviced for others, excluding whole loans owned; and
(b) Loans being interim serviced before sale as of the most recent calendar year end; and
(ii) Operates in two (2) or more states, districts, or territories of the United States either currently or as of the prior calendar year end.
(B) “Covered institution servicer” does not include:(i) A person exempt from mortgage servicer licensing requirements under this subchapter;(ii) A mortgage servicer that has the status of a tax-exempt organization under 26 U.S.C. § 501(c)(3), as in effect on January 1, 2025; or(iii) A mortgage servicer solely owning or conducting reverse mortgage servicing, or both, or the reverse mortgage portfolio administered by a large mortgage servicer;
(i) A person exempt from mortgage servicer licensing requirements under this subchapter;
(ii) A mortgage servicer that has the status of a tax-exempt organization under 26 U.S.C. § 501(c)(3), as in effect on January 1, 2025; or
(iii) A mortgage servicer solely owning or conducting reverse mortgage servicing, or both, or the reverse mortgage portfolio administered by a large mortgage servicer;
(16) “Customer” means a consumer who has a customer relationship with a financial institution;
(17) “Customer information” means a record containing nonpublic personal information about a customer of a financial institution, whether in paper, electronic, or other form, that is handled or maintained by or on behalf of a financial institution or the financial institution's affiliates;
(18) “Customer relationship” means a continuing relationship between a consumer and a financial institution under which the financial institution provides to the consumer one (1) or more financial products or services that are used primarily for personal, family, or household purposes;
(19) “Employee” means an individual who is licensed with or employed by a mortgage broker, mortgage banker, or mortgage servicer, whether by employment contract, agency, or other arrangement and regardless of whether the individual is treated as an employee for purposes of compliance with the federal income tax laws;
(20) “Encryption” means the transformation of data into a form that results in a low probability of assigning meaning without the use of a protective process or key, consistent with current cryptographic standards and accompanied by appropriate safeguards for cryptographic key material;
(21) (A) “Exempt person” means a person not required to be licensed as a mortgage broker, mortgage banker, mortgage servicer, loan officer, or transitional loan officer under this subchapter.(B) “Exempt person” includes any of the following:(i) An employee of a licensee whose responsibilities are limited to clerical and administrative tasks for his or her employer and who does not solicit borrowers, accept applications, or negotiate the terms of loans on behalf of the employer;(ii) An agency or corporate instrumentality of the federal government or any state, county, or municipal government granting mortgage loans under specific authority of the laws of any state or of the United States;(iii) A trust company or industrial loan company chartered under the laws of Arkansas;(iv) A small-business investment corporation licensed under the Small Business Investment Act of 1958, 15 U.S.C. § 661 et seq., as it existed on January 1, 2025;(v) A real estate investment trust as defined in 26 U.S.C. § 856, as it existed on January 1, 2025;(vi) A state or federally chartered bank, an operating subsidiary of a state-chartered bank regulated by the State Bank Department, a savings bank, a savings and loan association, or a credit union, the accounts of which are insured by the Federal Deposit Insurance Corporation or the National Credit Union Administration;(vii) An agricultural loan organization that is subject to licensing, supervision, or auditing by the United States Farm Service Agency, Commodity Credit Corporation, United States Department of Agriculture Rural Development, United States Farm Credit Administration, or the United States Department of Agriculture;(viii) A nonprofit corporation that:(a) Qualifies as a nonprofit entity under § 501(c)(3) of the Internal Revenue Code;(b) Is not primarily in the business of soliciting or brokering mortgage loans; and(c) Makes or services mortgage loans to promote home ownership or home improvements for the disadvantaged;(ix) (a) A licensed real estate agent or broker who is performing those activities subject to the regulation of the Arkansas Real Estate Commission.(b) Notwithstanding subdivision (21)(B)(ix)(a) of this section, “exempt person” does not include a real estate agent or broker who receives compensation of any kind in connection with the referral, placement, or origination of a mortgage loan;(x) A person who engages in seller-financed transactions or who as a seller of real property receives mortgages, deeds of trust, or other security instruments on real estate as security for a purchase money obligation if:(a) The person does not receive from or hold on behalf of the borrower any funds for the payment of insurance or taxes on the real property; and(b) The seller does not sell the liens or mortgages in the secondary market other than to affiliated or subsidiary persons;(xi) An individual or married couple who provide funds for investment in loans secured by a lien on real property on his or her or their own account and who do not:(a) Charge a fee or cause a fee to be paid for any service other than the normal and scheduled rates for escrow, title insurance, and recording services; and(b) Collect funds to be used for the payment of any taxes or insurance premiums on the property securing the loans;(xii) An attorney licensed in Arkansas rendering legal services to his or her client, when the conduct that would subject the attorney to the jurisdiction of this subchapter is ancillary to the provision of the legal services offered;(xiii) A person performing any act under order of any court;(xiv) A person acting as a mortgage broker, mortgage banker, or mortgage servicer for any person located in Arkansas, if the mortgage broker, mortgage banker, or mortgage servicer has no office or employee in Arkansas and the real property that is the subject of the mortgage is located outside of Arkansas;(xv) An officer or employee of an exempt person described in subdivisions (21)(B)(ii)-(xiv) of this section if acting in the scope of employment for the exempt person; and(xvi) A manufactured or modular home retailer and its employees if:(a) The manufactured or modular home retailer or its employees perform only administrative or clerical tasks on behalf of a person required to be licensed under this subchapter; or(b) The manufactured or modular home retailer and its employees:(1) Do not receive compensation or financial gain for engaging in loan officer activities that exceeds the amount of compensation or financial gain that could be received in a comparable cash transaction for a manufactured home;(2) Disclose to the consumer in writing any corporate affiliation with a mortgage banker;(3) Provide referral information for at least one (1) unaffiliated creditor if the manufactured or modular home retailer has a corporate affiliation with a mortgage banker and the mortgage banker offers a recommendation; and(4) (A) Do not directly negotiate loan terms with the consumer or lender.(B) As used in subdivision (21)(B)(xvi)(b)(4)(A) of this section, “loan terms” includes rates, fees, and other costs;
(A) “Exempt person” means a person not required to be licensed as a mortgage broker, mortgage banker, mortgage servicer, loan officer, or transitional loan officer under this subchapter.
(B) “Exempt person” includes any of the following:(i) An employee of a licensee whose responsibilities are limited to clerical and administrative tasks for his or her employer and who does not solicit borrowers, accept applications, or negotiate the terms of loans on behalf of the employer;(ii) An agency or corporate instrumentality of the federal government or any state, county, or municipal government granting mortgage loans under specific authority of the laws of any state or of the United States;(iii) A trust company or industrial loan company chartered under the laws of Arkansas;(iv) A small-business investment corporation licensed under the Small Business Investment Act of 1958, 15 U.S.C. § 661 et seq., as it existed on January 1, 2025;(v) A real estate investment trust as defined in 26 U.S.C. § 856, as it existed on January 1, 2025;(vi) A state or federally chartered bank, an operating subsidiary of a state-chartered bank regulated by the State Bank Department, a savings bank, a savings and loan association, or a credit union, the accounts of which are insured by the Federal Deposit Insurance Corporation or the National Credit Union Administration;(vii) An agricultural loan organization that is subject to licensing, supervision, or auditing by the United States Farm Service Agency, Commodity Credit Corporation, United States Department of Agriculture Rural Development, United States Farm Credit Administration, or the United States Department of Agriculture;(viii) A nonprofit corporation that:(a) Qualifies as a nonprofit entity under § 501(c)(3) of the Internal Revenue Code;(b) Is not primarily in the business of soliciting or brokering mortgage loans; and(c) Makes or services mortgage loans to promote home ownership or home improvements for the disadvantaged;(ix) (a) A licensed real estate agent or broker who is performing those activities subject to the regulation of the Arkansas Real Estate Commission.(b) Notwithstanding subdivision (21)(B)(ix)(a) of this section, “exempt person” does not include a real estate agent or broker who receives compensation of any kind in connection with the referral, placement, or origination of a mortgage loan;(x) A person who engages in seller-financed transactions or who as a seller of real property receives mortgages, deeds of trust, or other security instruments on real estate as security for a purchase money obligation if:(a) The person does not receive from or hold on behalf of the borrower any funds for the payment of insurance or taxes on the real property; and(b) The seller does not sell the liens or mortgages in the secondary market other than to affiliated or subsidiary persons;(xi) An individual or married couple who provide funds for investment in loans secured by a lien on real property on his or her or their own account and who do not:(a) Charge a fee or cause a fee to be paid for any service other than the normal and scheduled rates for escrow, title insurance, and recording services; and(b) Collect funds to be used for the payment of any taxes or insurance premiums on the property securing the loans;(xii) An attorney licensed in Arkansas rendering legal services to his or her client, when the conduct that would subject the attorney to the jurisdiction of this subchapter is ancillary to the provision of the legal services offered;(xiii) A person performing any act under order of any court;(xiv) A person acting as a mortgage broker, mortgage banker, or mortgage servicer for any person located in Arkansas, if the mortgage broker, mortgage banker, or mortgage servicer has no office or employee in Arkansas and the real property that is the subject of the mortgage is located outside of Arkansas;(xv) An officer or employee of an exempt person described in subdivisions (21)(B)(ii)-(xiv) of this section if acting in the scope of employment for the exempt person; and(xvi) A manufactured or modular home retailer and its employees if:(a) The manufactured or modular home retailer or its employees perform only administrative or clerical tasks on behalf of a person required to be licensed under this subchapter; or(b) The manufactured or modular home retailer and its employees:(1) Do not receive compensation or financial gain for engaging in loan officer activities that exceeds the amount of compensation or financial gain that could be received in a comparable cash transaction for a manufactured home;(2) Disclose to the consumer in writing any corporate affiliation with a mortgage banker;(3) Provide referral information for at least one (1) unaffiliated creditor if the manufactured or modular home retailer has a corporate affiliation with a mortgage banker and the mortgage banker offers a recommendation; and(4) (A) Do not directly negotiate loan terms with the consumer or lender.(B) As used in subdivision (21)(B)(xvi)(b)(4)(A) of this section, “loan terms” includes rates, fees, and other costs;
(i) An employee of a licensee whose responsibilities are limited to clerical and administrative tasks for his or her employer and who does not solicit borrowers, accept applications, or negotiate the terms of loans on behalf of the employer;
(ii) An agency or corporate instrumentality of the federal government or any state, county, or municipal government granting mortgage loans under specific authority of the laws of any state or of the United States;
(iii) A trust company or industrial loan company chartered under the laws of Arkansas;
(iv) A small-business investment corporation licensed under the Small Business Investment Act of 1958, 15 U.S.C. § 661 et seq., as it existed on January 1, 2025;
(v) A real estate investment trust as defined in 26 U.S.C. § 856, as it existed on January 1, 2025;
(vi) A state or federally chartered bank, an operating subsidiary of a state-chartered bank regulated by the State Bank Department, a savings bank, a savings and loan association, or a credit union, the accounts of which are insured by the Federal Deposit Insurance Corporation or the National Credit Union Administration;
(vii) An agricultural loan organization that is subject to licensing, supervision, or auditing by the United States Farm Service Agency, Commodity Credit Corporation, United States Department of Agriculture Rural Development, United States Farm Credit Administration, or the United States Department of Agriculture;
(viii) A nonprofit corporation that:(a) Qualifies as a nonprofit entity under § 501(c)(3) of the Internal Revenue Code;(b) Is not primarily in the business of soliciting or brokering mortgage loans; and(c) Makes or services mortgage loans to promote home ownership or home improvements for the disadvantaged;
(a) Qualifies as a nonprofit entity under § 501(c)(3) of the Internal Revenue Code;
(b) Is not primarily in the business of soliciting or brokering mortgage loans; and
(c) Makes or services mortgage loans to promote home ownership or home improvements for the disadvantaged;
(ix) (a) A licensed real estate agent or broker who is performing those activities subject to the regulation of the Arkansas Real Estate Commission.(b) Notwithstanding subdivision (21)(B)(ix)(a) of this section, “exempt person” does not include a real estate agent or broker who receives compensation of any kind in connection with the referral, placement, or origination of a mortgage loan;
(a) A licensed real estate agent or broker who is performing those activities subject to the regulation of the Arkansas Real Estate Commission.
(b) Notwithstanding subdivision (21)(B)(ix)(a) of this section, “exempt person” does not include a real estate agent or broker who receives compensation of any kind in connection with the referral, placement, or origination of a mortgage loan;
(x) A person who engages in seller-financed transactions or who as a seller of real property receives mortgages, deeds of trust, or other security instruments on real estate as security for a purchase money obligation if:(a) The person does not receive from or hold on behalf of the borrower any funds for the payment of insurance or taxes on the real property; and(b) The seller does not sell the liens or mortgages in the secondary market other than to affiliated or subsidiary persons;
(a) The person does not receive from or hold on behalf of the borrower any funds for the payment of insurance or taxes on the real property; and
(b) The seller does not sell the liens or mortgages in the secondary market other than to affiliated or subsidiary persons;
(xi) An individual or married couple who provide funds for investment in loans secured by a lien on real property on his or her or their own account and who do not:(a) Charge a fee or cause a fee to be paid for any service other than the normal and scheduled rates for escrow, title insurance, and recording services; and(b) Collect funds to be used for the payment of any taxes or insurance premiums on the property securing the loans;
(a) Charge a fee or cause a fee to be paid for any service other than the normal and scheduled rates for escrow, title insurance, and recording services; and
(b) Collect funds to be used for the payment of any taxes or insurance premiums on the property securing the loans;
(xii) An attorney licensed in Arkansas rendering legal services to his or her client, when the conduct that would subject the attorney to the jurisdiction of this subchapter is ancillary to the provision of the legal services offered;
(xiii) A person performing any act under order of any court;
(xiv) A person acting as a mortgage broker, mortgage banker, or mortgage servicer for any person located in Arkansas, if the mortgage broker, mortgage banker, or mortgage servicer has no office or employee in Arkansas and the real property that is the subject of the mortgage is located outside of Arkansas;
(xv) An officer or employee of an exempt person described in subdivisions (21)(B)(ii)-(xiv) of this section if acting in the scope of employment for the exempt person; and
(xvi) A manufactured or modular home retailer and its employees if:(a) The manufactured or modular home retailer or its employees perform only administrative or clerical tasks on behalf of a person required to be licensed under this subchapter; or(b) The manufactured or modular home retailer and its employees:(1) Do not receive compensation or financial gain for engaging in loan officer activities that exceeds the amount of compensation or financial gain that could be received in a comparable cash transaction for a manufactured home;(2) Disclose to the consumer in writing any corporate affiliation with a mortgage banker;(3) Provide referral information for at least one (1) unaffiliated creditor if the manufactured or modular home retailer has a corporate affiliation with a mortgage banker and the mortgage banker offers a recommendation; and(4) (A) Do not directly negotiate loan terms with the consumer or lender.(B) As used in subdivision (21)(B)(xvi)(b)(4)(A) of this section, “loan terms” includes rates, fees, and other costs;
(a) The manufactured or modular home retailer or its employees perform only administrative or clerical tasks on behalf of a person required to be licensed under this subchapter; or
(b) The manufactured or modular home retailer and its employees:(1) Do not receive compensation or financial gain for engaging in loan officer activities that exceeds the amount of compensation or financial gain that could be received in a comparable cash transaction for a manufactured home;(2) Disclose to the consumer in writing any corporate affiliation with a mortgage banker;(3) Provide referral information for at least one (1) unaffiliated creditor if the manufactured or modular home retailer has a corporate affiliation with a mortgage banker and the mortgage banker offers a recommendation; and(4) (A) Do not directly negotiate loan terms with the consumer or lender.(B) As used in subdivision (21)(B)(xvi)(b)(4)(A) of this section, “loan terms” includes rates, fees, and other costs;
(1) Do not receive compensation or financial gain for engaging in loan officer activities that exceeds the amount of compensation or financial gain that could be received in a comparable cash transaction for a manufactured home;
(2) Disclose to the consumer in writing any corporate affiliation with a mortgage banker;
(3) Provide referral information for at least one (1) unaffiliated creditor if the manufactured or modular home retailer has a corporate affiliation with a mortgage banker and the mortgage banker offers a recommendation; and
(4) (A) Do not directly negotiate loan terms with the consumer or lender.(B) As used in subdivision (21)(B)(xvi)(b)(4)(A) of this section, “loan terms” includes rates, fees, and other costs;
(A) Do not directly negotiate loan terms with the consumer or lender.
(B) As used in subdivision (21)(B)(xvi)(b)(4)(A) of this section, “loan terms” includes rates, fees, and other costs;
(22) “External audit” means a formal report prepared by an independent certified public accountant expressing an opinion on whether financial statements are:(A) Presented fairly, in all material aspects, according to the applicable financial reporting framework; and(B) Inclusive of an evaluation of the adequacy of a company's internal control structure;
(A) Presented fairly, in all material aspects, according to the applicable financial reporting framework; and
(B) Inclusive of an evaluation of the adequacy of a company's internal control structure;
(23) “Financial institution” means a mortgage broker, mortgage banker, or mortgage servicer licensed under this subchapter;
(24) (A) “Financial product or service” means a product or service that a financial holding company could offer by engaging in a financial activity under section 4(k) of the Bank Holding Company Act of 1956, 12 U.S.C. § 1843(k), as it existed on January 1, 2025.(B) “Financial product or service” includes a financial institution's evaluation or brokerage of information that a financial institution collects in connection with a request or an application from a consumer for a financial product or service;
(A) “Financial product or service” means a product or service that a financial holding company could offer by engaging in a financial activity under section 4(k) of the Bank Holding Company Act of 1956, 12 U.S.C. § 1843(k), as it existed on January 1, 2025.
(B) “Financial product or service” includes a financial institution's evaluation or brokerage of information that a financial institution collects in connection with a request or an application from a consumer for a financial product or service;
(25) “Information security program” means the administrative, technical, or physical safeguards a financial institution uses to access, collect, distribute, process, protect, store, use, transmit, dispose of, or otherwise handle customer information;
(26) “Information system” means a discrete set of electronic information resources organized for the collection, processing, maintenance, use, sharing, dissemination, or disposition of electronic information, including any specialized system, such as an industrial controls system or a process controls system, a telephone switching and private branch exchange system, and an environmental control system, that contain customer information or that is connected to a system that contains customer information;
(27) “Interim serviced before sale” means the activity of collecting a limited number of contractual mortgage payments immediately after origination on loans held for sale but before the loans have been sold into the secondary market;
(28) “Internal audit” means the internal activity of performing independent, objective assurance, and consulting to evaluate and improve the effectiveness of company operations, risk management, internal controls, and governance processes;
(29) (A) “Key individual” means an individual who is ultimately responsible for establishing or directing policies and procedures of a licensee.(B) “Key individual” includes without limitation:(i) An executive officer;(ii) A manager;(iii) A director;(iv) A trustee; or(v) A control person;
(A) “Key individual” means an individual who is ultimately responsible for establishing or directing policies and procedures of a licensee.
(B) “Key individual” includes without limitation:(i) An executive officer;(ii) A manager;(iii) A director;(iv) A trustee; or(v) A control person;
(i) An executive officer;
(ii) A manager;
(iii) A director;
(iv) A trustee; or
(v) A control person;
(30) “Licensee” means a loan officer, transitional loan officer, mortgage broker, mortgage banker, or mortgage servicer that is licensed under this subchapter;
(31) (A) “Loan officer” means an individual other than an exempt person described in subdivision (21) of this section who in exchange for compensation as an employee of or who otherwise receives compensation or remuneration from a mortgage broker or a mortgage banker:(i) Solicits or offers to solicit an application for a mortgage loan;(ii) Accepts or offers to accept an application for a mortgage loan;(iii) Negotiates or offers to negotiate the terms or conditions of a mortgage loan;(iv) Issues or offers to issue a mortgage loan commitment or interest rate guarantee agreement; or(v) Provides or offers to provide modification of a mortgage loan.(B) “Loan officer” does not include:(i) An individual who performs clerical or administrative tasks in the processing of a mortgage loan at the direction of and subject to the supervision and instruction of a licensed loan officer;(ii) An underwriter if the individual performs no activities under subdivision (31)(A) of this section; or(iii) An individual who is solely involved in extensions of credit relating to timeshare plans, as that term is defined in 11 U.S.C. § 101(53D), as it existed on January 1, 2025;
(A) “Loan officer” means an individual other than an exempt person described in subdivision (21) of this section who in exchange for compensation as an employee of or who otherwise receives compensation or remuneration from a mortgage broker or a mortgage banker:(i) Solicits or offers to solicit an application for a mortgage loan;(ii) Accepts or offers to accept an application for a mortgage loan;(iii) Negotiates or offers to negotiate the terms or conditions of a mortgage loan;(iv) Issues or offers to issue a mortgage loan commitment or interest rate guarantee agreement; or(v) Provides or offers to provide modification of a mortgage loan.
(i) Solicits or offers to solicit an application for a mortgage loan;
(ii) Accepts or offers to accept an application for a mortgage loan;
(iii) Negotiates or offers to negotiate the terms or conditions of a mortgage loan;
(iv) Issues or offers to issue a mortgage loan commitment or interest rate guarantee agreement; or
(v) Provides or offers to provide modification of a mortgage loan.
(B) “Loan officer” does not include:(i) An individual who performs clerical or administrative tasks in the processing of a mortgage loan at the direction of and subject to the supervision and instruction of a licensed loan officer;(ii) An underwriter if the individual performs no activities under subdivision (31)(A) of this section; or(iii) An individual who is solely involved in extensions of credit relating to timeshare plans, as that term is defined in 11 U.S.C. § 101(53D), as it existed on January 1, 2025;
(i) An individual who performs clerical or administrative tasks in the processing of a mortgage loan at the direction of and subject to the supervision and instruction of a licensed loan officer;
(ii) An underwriter if the individual performs no activities under subdivision (31)(A) of this section; or
(iii) An individual who is solely involved in extensions of credit relating to timeshare plans, as that term is defined in 11 U.S.C. § 101(53D), as it existed on January 1, 2025;
(32) “Make a mortgage loan” means to close a mortgage loan, to advance funds, to offer to advance funds, or to make a commitment to advance funds to a borrower under a mortgage loan;
(33) (A) “Managing principal” means a person who meets the requirements of § 23-39-508 and who agrees to be primarily responsible for the operations of a licensed mortgage broker, mortgage banker, or mortgage servicer.(B) “Managing principal” includes a qualifying individual;
(A) “Managing principal” means a person who meets the requirements of § 23-39-508 and who agrees to be primarily responsible for the operations of a licensed mortgage broker, mortgage banker, or mortgage servicer.
(B) “Managing principal” includes a qualifying individual;
(34) “Mortgage banker” means a person who engages in the business of making mortgage loans for compensation or other gain;
(35) “Mortgage broker” means a person who for compensation or other gain or in the expectation of compensation or other gain and, regardless of whether the acts are done directly or indirectly, through contact by telephone, by electronic means, by mail, or in person with the borrowers or potential borrowers:(A) Accepts or offers to accept an application for a mortgage loan;(B) Solicits or offers to solicit an application for a mortgage loan;(C) Negotiates or offers to negotiate the terms or conditions of a mortgage loan; or(D) Issues or offers to issue mortgage loan commitments or interest rate guarantee agreements to borrowers;
(A) Accepts or offers to accept an application for a mortgage loan;
(B) Solicits or offers to solicit an application for a mortgage loan;
(C) Negotiates or offers to negotiate the terms or conditions of a mortgage loan; or
(D) Issues or offers to issue mortgage loan commitments or interest rate guarantee agreements to borrowers;
(36) “Mortgage call report” means a quarterly or annual report of residential real estate loan origination, servicing, and financial information completed by a company licensed through the Nationwide Multistate Licensing System and Registry;
(37) (A) “Mortgage loan” means a loan primarily for personal, family, or household use that is secured by a mortgage, deed of trust, reverse mortgage, or other equivalent consensual security interest encumbering:(i) A dwelling as defined in section 1602(w) of the Truth in Lending Act, 15 U.S.C. § 1601 et seq., as it existed on January 1, 2025; or(ii) Residential real estate upon which is constructed or intended to be constructed a dwelling.(B) “Mortgage loan” includes a residential mortgage loan;
(A) “Mortgage loan” means a loan primarily for personal, family, or household use that is secured by a mortgage, deed of trust, reverse mortgage, or other equivalent consensual security interest encumbering:(i) A dwelling as defined in section 1602(w) of the Truth in Lending Act, 15 U.S.C. § 1601 et seq., as it existed on January 1, 2025; or(ii) Residential real estate upon which is constructed or intended to be constructed a dwelling.
(i) A dwelling as defined in section 1602(w) of the Truth in Lending Act, 15 U.S.C. § 1601 et seq., as it existed on January 1, 2025; or
(ii) Residential real estate upon which is constructed or intended to be constructed a dwelling.
(B) “Mortgage loan” includes a residential mortgage loan;
(38) (A) “Mortgage servicer” means:(i) An entity performing the routine administration of a residential mortgage loan on behalf of an owner of the related mortgage under the terms of a servicing contract; or(ii) A person that receives or has the right to receive from or on behalf of a borrower:(a) Funds or credits in payment for a mortgage loan; or(b) The taxes or insurance associated with a mortgage loan.(B) In the case of a home equity conversion mortgage or a reverse mortgage, “mortgage servicer” includes a person that makes a payment to the borrower;
(A) “Mortgage servicer” means:(i) An entity performing the routine administration of a residential mortgage loan on behalf of an owner of the related mortgage under the terms of a servicing contract; or(ii) A person that receives or has the right to receive from or on behalf of a borrower:(a) Funds or credits in payment for a mortgage loan; or(b) The taxes or insurance associated with a mortgage loan.
(i) An entity performing the routine administration of a residential mortgage loan on behalf of an owner of the related mortgage under the terms of a servicing contract; or
(ii) A person that receives or has the right to receive from or on behalf of a borrower:(a) Funds or credits in payment for a mortgage loan; or(b) The taxes or insurance associated with a mortgage loan.
(a) Funds or credits in payment for a mortgage loan; or
(b) The taxes or insurance associated with a mortgage loan.
(B) In the case of a home equity conversion mortgage or a reverse mortgage, “mortgage servicer” includes a person that makes a payment to the borrower;
(39) “Mortgage servicing rights” means the contractual right to service residential mortgage loans on behalf of the owner of the associated mortgage in exchange for specified compensation according to a servicing contract;
(40) (A) “Mortgage trigger lead” means a lead resulting from a consumer report obtained under 15 U.S.C. § 1681b, as it existed on January 1, 2025, if the issuance of the consumer report is triggered by an inquiry made with a consumer reporting agency in response to an application for credit.(B) “Mortgage trigger lead” does not include a consumer report obtained by a lender that holds or services existing indebtedness of the applicant who is the subject of the consumer report;
(A) “Mortgage trigger lead” means a lead resulting from a consumer report obtained under 15 U.S.C. § 1681b, as it existed on January 1, 2025, if the issuance of the consumer report is triggered by an inquiry made with a consumer reporting agency in response to an application for credit.
(B) “Mortgage trigger lead” does not include a consumer report obtained by a lender that holds or services existing indebtedness of the applicant who is the subject of the consumer report;
(41) “Multifactor authentication” means authentication through verification of at least two (2) of the following types of authentication factors:(A) Knowledge factors, including without limitation a password;(B) Possession factors, including without limitation a token; or(C) Inherence factors, including without limitation biometric characteristics;
(A) Knowledge factors, including without limitation a password;
(B) Possession factors, including without limitation a token; or
(C) Inherence factors, including without limitation biometric characteristics;
(42) (A) “Nonpublic personal information” means:(i) Personally identifiable financial information; and(ii) A list, description, or other grouping of consumers, and publicly available information pertaining to a consumer, that is derived using personally identifiable financial information that is not publicly available.(B) “Nonpublic personal information” includes without limitation a list of individuals' names and street addresses that is derived in whole or in part using personally identifiable financial information that is not publicly available.(C) “Nonpublic personal information” does not include:(i) Publicly available information except as included on a list described in subdivision (42)(A)(ii) of this section;(ii) A list, description, or other grouping of consumers, and publicly available information pertaining to the list, description, or other grouping of consumers, that is derived without using personally identifiable financial information that is not publicly available; or(iii) A list of individuals' names and addresses that contains only publicly available information and is not: (a) Derived, in whole or in part, using personally identifiable financial information that is not publicly available; and (b) Disclosed in a manner that indicates that any of the individuals on the list is a consumer of a financial institution;
(A) “Nonpublic personal information” means:(i) Personally identifiable financial information; and(ii) A list, description, or other grouping of consumers, and publicly available information pertaining to a consumer, that is derived using personally identifiable financial information that is not publicly available.
(i) Personally identifiable financial information; and
(ii) A list, description, or other grouping of consumers, and publicly available information pertaining to a consumer, that is derived using personally identifiable financial information that is not publicly available.
(B) “Nonpublic personal information” includes without limitation a list of individuals' names and street addresses that is derived in whole or in part using personally identifiable financial information that is not publicly available.
(C) “Nonpublic personal information” does not include:(i) Publicly available information except as included on a list described in subdivision (42)(A)(ii) of this section;(ii) A list, description, or other grouping of consumers, and publicly available information pertaining to the list, description, or other grouping of consumers, that is derived without using personally identifiable financial information that is not publicly available; or(iii) A list of individuals' names and addresses that contains only publicly available information and is not: (a) Derived, in whole or in part, using personally identifiable financial information that is not publicly available; and (b) Disclosed in a manner that indicates that any of the individuals on the list is a consumer of a financial institution;
(i) Publicly available information except as included on a list described in subdivision (42)(A)(ii) of this section;
(ii) A list, description, or other grouping of consumers, and publicly available information pertaining to the list, description, or other grouping of consumers, that is derived without using personally identifiable financial information that is not publicly available; or
(iii) A list of individuals' names and addresses that contains only publicly available information and is not: (a) Derived, in whole or in part, using personally identifiable financial information that is not publicly available; and (b) Disclosed in a manner that indicates that any of the individuals on the list is a consumer of a financial institution;
(a) Derived, in whole or in part, using personally identifiable financial information that is not publicly available; and
(b) Disclosed in a manner that indicates that any of the individuals on the list is a consumer of a financial institution;
(43) (A) “Notification event” means acquisition of unencrypted customer information without the authorization of the customer to which the customer information pertains.(B) For purposes of subdivision (43)(A) of this section:(i) Customer information is considered unencrypted if the encryption key was accessed by an unauthorized person; and(ii) Unauthorized acquisition is presumed to include unauthorized access to unencrypted customer information unless a financial institution has reliable evidence showing that there has not been, or could not reasonably have been, unauthorized acquisition of the customer information;
(A) “Notification event” means acquisition of unencrypted customer information without the authorization of the customer to which the customer information pertains.
(B) For purposes of subdivision (43)(A) of this section:(i) Customer information is considered unencrypted if the encryption key was accessed by an unauthorized person; and(ii) Unauthorized acquisition is presumed to include unauthorized access to unencrypted customer information unless a financial institution has reliable evidence showing that there has not been, or could not reasonably have been, unauthorized acquisition of the customer information;
(i) Customer information is considered unencrypted if the encryption key was accessed by an unauthorized person; and
(ii) Unauthorized acquisition is presumed to include unauthorized access to unencrypted customer information unless a financial institution has reliable evidence showing that there has not been, or could not reasonably have been, unauthorized acquisition of the customer information;
(44) “Operating liquidity” means the funds necessary to perform normal business operations, including payment of rent, salaries, interest expense, and other typical expenses associated with operating an entity;
(45) “Operating subsidiary” means a separate corporation, limited liability company, or similar entity in which a national or state bank, savings and loan association, or credit union, the accounts of which are insured by the Federal Deposit Insurance Corporation or the National Credit Union Administration, maintains more than fifty percent (50%) voting rights, a controlling interest, or otherwise controls the subsidiary and no other party controls more than fifty percent (50%) of the voting rights or a controlling interest in the subsidiary;
(46) “Penetration testing” means a test methodology in which assessors attempt to circumvent or defeat the security features of an information system by attempting penetration of databases or controls from outside or inside a financial institution's information system;
(47) “Person” means an individual, partnership, limited liability company, limited partnership, corporation, association, or other group engaged in joint business activities, however organized;
(48) (A) “Personally identifiable financial information” means information:(i) A consumer provides to a financial institution to obtain a financial product or service from a financial institution;(ii) About a consumer resulting from a transaction involving a financial product or service between a financial institution and a consumer; or(iii) A financial institution otherwise obtains about a consumer in connection with providing a financial product or service to that consumer.(B) “Personally identifiable financial information” includes:(i) Information a consumer provides to a financial institution on an application to obtain a loan, credit card, or other financial product or service;(ii) Account balance information, payment history, overdraft history, and credit or debit card purchase information;(iii) The fact that an individual is or has been a financial institution's customer or has obtained a financial product or service from a financial institution;(iv) Information about a financial institution's consumer if the information is disclosed in a manner that indicates that the individual is or has been the financial institution's consumer;(v) Information that a consumer provides to a financial institution or that a financial institution or a financial institution's agent otherwise obtains in connection with collecting on or servicing a credit account;(vi) Information a financial institution collects through an internet cookie or an information collecting device from a computer server; and(vii) Information from a consumer report.(C) “Personally identifiable financial information” does not include:(i) A list of names and addresses of customers of an entity that is not a financial institution; and(ii) Information that does not identify a consumer, including aggregate information or blind data that does not contain personal identifiers such as account numbers, names, or addresses;
(A) “Personally identifiable financial information” means information:(i) A consumer provides to a financial institution to obtain a financial product or service from a financial institution;(ii) About a consumer resulting from a transaction involving a financial product or service between a financial institution and a consumer; or(iii) A financial institution otherwise obtains about a consumer in connection with providing a financial product or service to that consumer.
(i) A consumer provides to a financial institution to obtain a financial product or service from a financial institution;
(ii) About a consumer resulting from a transaction involving a financial product or service between a financial institution and a consumer; or
(iii) A financial institution otherwise obtains about a consumer in connection with providing a financial product or service to that consumer.
(B) “Personally identifiable financial information” includes:(i) Information a consumer provides to a financial institution on an application to obtain a loan, credit card, or other financial product or service;(ii) Account balance information, payment history, overdraft history, and credit or debit card purchase information;(iii) The fact that an individual is or has been a financial institution's customer or has obtained a financial product or service from a financial institution;(iv) Information about a financial institution's consumer if the information is disclosed in a manner that indicates that the individual is or has been the financial institution's consumer;(v) Information that a consumer provides to a financial institution or that a financial institution or a financial institution's agent otherwise obtains in connection with collecting on or servicing a credit account;(vi) Information a financial institution collects through an internet cookie or an information collecting device from a computer server; and(vii) Information from a consumer report.
(i) Information a consumer provides to a financial institution on an application to obtain a loan, credit card, or other financial product or service;
(ii) Account balance information, payment history, overdraft history, and credit or debit card purchase information;
(iii) The fact that an individual is or has been a financial institution's customer or has obtained a financial product or service from a financial institution;
(iv) Information about a financial institution's consumer if the information is disclosed in a manner that indicates that the individual is or has been the financial institution's consumer;
(v) Information that a consumer provides to a financial institution or that a financial institution or a financial institution's agent otherwise obtains in connection with collecting on or servicing a credit account;
(vi) Information a financial institution collects through an internet cookie or an information collecting device from a computer server; and
(vii) Information from a consumer report.
(C) “Personally identifiable financial information” does not include:(i) A list of names and addresses of customers of an entity that is not a financial institution; and(ii) Information that does not identify a consumer, including aggregate information or blind data that does not contain personal identifiers such as account numbers, names, or addresses;
(i) A list of names and addresses of customers of an entity that is not a financial institution; and
(ii) Information that does not identify a consumer, including aggregate information or blind data that does not contain personal identifiers such as account numbers, names, or addresses;
(49) “Principal place of business” means a stationary construction consisting of at least one (1) enclosed room or building in which negotiations of mortgage loan transactions of others may be conducted in private or in which the primary business functions of the licensee are conducted;
(50) (A) “Publicly available information” means information that a financial institution has a reasonable basis to believe is lawfully made available to the public from:(i) Federal, state, or local government records;(ii) Widely distributed media; or(iii) Disclosures to the public that are required to be made by federal, state, or local law.(B) “Publicly available information” includes without limitation:(i) Information in government records, including information in government real estate records and security interest filings; and(ii) (a) Information from widely distributed media, including information from a telephone book, television or radio program, newspaper, or website that is available to the public on an unrestricted basis. (b) A website is not restricted under subdivision (50)(B)(ii)(a) of this section merely because an internet service provider or a site operator requires a fee or a password, so long as access is available to the public.(C) For purposes of this subdivision (50), a financial institution has a reasonable basis to believe that:(i) Information is lawfully made available to the public if the financial institution has taken steps to determine: (a) That the information is of the type that is available to the public; and (b) Whether an individual can direct that the information not be made available to the public and, if so, that the financial institution's consumer has not directed that the information not be made available to the public;(ii) Mortgage information is lawfully made available to the public if the financial institution determines that the mortgage information is of the type included on the public record in the jurisdiction where the mortgage would be recorded; and(iii) An individual's telephone number is lawfully made available to the public if the financial institution has located the telephone number in a telephone directory or the consumer has informed the financial institution that the telephone number is not unlisted;
(A) “Publicly available information” means information that a financial institution has a reasonable basis to believe is lawfully made available to the public from:(i) Federal, state, or local government records;(ii) Widely distributed media; or(iii) Disclosures to the public that are required to be made by federal, state, or local law.
(i) Federal, state, or local government records;
(ii) Widely distributed media; or
(iii) Disclosures to the public that are required to be made by federal, state, or local law.
(B) “Publicly available information” includes without limitation:(i) Information in government records, including information in government real estate records and security interest filings; and(ii) (a) Information from widely distributed media, including information from a telephone book, television or radio program, newspaper, or website that is available to the public on an unrestricted basis. (b) A website is not restricted under subdivision (50)(B)(ii)(a) of this section merely because an internet service provider or a site operator requires a fee or a password, so long as access is available to the public.
(i) Information in government records, including information in government real estate records and security interest filings; and
(ii) (a) Information from widely distributed media, including information from a telephone book, television or radio program, newspaper, or website that is available to the public on an unrestricted basis. (b) A website is not restricted under subdivision (50)(B)(ii)(a) of this section merely because an internet service provider or a site operator requires a fee or a password, so long as access is available to the public.
(a) Information from widely distributed media, including information from a telephone book, television or radio program, newspaper, or website that is available to the public on an unrestricted basis.
(b) A website is not restricted under subdivision (50)(B)(ii)(a) of this section merely because an internet service provider or a site operator requires a fee or a password, so long as access is available to the public.
(C) For purposes of this subdivision (50), a financial institution has a reasonable basis to believe that:(i) Information is lawfully made available to the public if the financial institution has taken steps to determine: (a) That the information is of the type that is available to the public; and (b) Whether an individual can direct that the information not be made available to the public and, if so, that the financial institution's consumer has not directed that the information not be made available to the public;(ii) Mortgage information is lawfully made available to the public if the financial institution determines that the mortgage information is of the type included on the public record in the jurisdiction where the mortgage would be recorded; and(iii) An individual's telephone number is lawfully made available to the public if the financial institution has located the telephone number in a telephone directory or the consumer has informed the financial institution that the telephone number is not unlisted;
(i) Information is lawfully made available to the public if the financial institution has taken steps to determine: (a) That the information is of the type that is available to the public; and (b) Whether an individual can direct that the information not be made available to the public and, if so, that the financial institution's consumer has not directed that the information not be made available to the public;
(a) That the information is of the type that is available to the public; and
(b) Whether an individual can direct that the information not be made available to the public and, if so, that the financial institution's consumer has not directed that the information not be made available to the public;
(ii) Mortgage information is lawfully made available to the public if the financial institution determines that the mortgage information is of the type included on the public record in the jurisdiction where the mortgage would be recorded; and
(iii) An individual's telephone number is lawfully made available to the public if the financial institution has located the telephone number in a telephone directory or the consumer has informed the financial institution that the telephone number is not unlisted;
(51) “Qualified individual” means an individual designated by a financial institution to oversee, implement, and enforce the financial institution's information security program;
(52) “Residential mortgage loans serviced” means a specific portfolio or portfolios of residential mortgage loans for which a licensee is contractually responsible to the owner or owners of the mortgage loans for the defined servicing activities;
(53) “Reverse mortgage” means a nonrecourse loan that pays a homeowner loan proceeds drawn from accumulated home equity;
(54) “Risk management assessment” means the functional evaluations performed under the risk management program and reports provided to a board of directors under a relevant governance protocol;
(55) “Risk management program” means the policies and procedures designed to identify, measure, monitor, and mitigate risk sufficient for the level of sophistication of a covered institution servicer;
(56) “Security event” means an event resulting in unauthorized access to, or disruption or misuse of:(A) An information system or information stored on the information system; or(B) Customer information held in physical form;
(A) An information system or information stored on the information system; or
(B) Customer information held in physical form;
(57) “Service provider” means a person or entity that receives, maintains, processes, or otherwise is permitted access to customer information through its provision of services directly to a financial institution that is subject to this subchapter;
(58) “Servicing liquidity” means the financial resources necessary to manage liquidity risk arising from servicing functions required in acquiring and financing mortgage servicing rights, hedging costs, and margin calls associated with the mortgage servicing rights asset and financing facilities and advances or costs of advance financing for principal, interest, taxes, insurance, and any other servicing-related advances;
(59) “Sponsor” means a mortgage broker or mortgage banker licensed under this subchapter that has assumed the responsibility for and agrees to supervise the actions of a loan officer or transitional loan officer;
(60) “Tangible net worth” means the total equity less:(A) The receivables due from related entities;(B) Goodwill and other intangibles; and(C) Pledged assets;
(A) The receivables due from related entities;
(B) Goodwill and other intangibles; and
(C) Pledged assets;
(61) “Transitional loan officer” means an individual who, in exchange for compensation as an employee of, or who otherwise receives compensation or remuneration from, a mortgage broker or a mortgage banker, is authorized to act as a loan officer subject to a transitional loan officer license;
(62) “Transitional loan officer license” means a license that:(A) Is issued to an individual who is employed and sponsored by a mortgage banker or mortgage broker licensed under this subchapter;(B) Is limited to a term of no more than one hundred twenty (120) days; and(C) Is not subject to reapplication, renewal, or extension by the commissioner;
(A) Is issued to an individual who is employed and sponsored by a mortgage banker or mortgage broker licensed under this subchapter;
(B) Is limited to a term of no more than one hundred twenty (120) days; and
(C) Is not subject to reapplication, renewal, or extension by the commissioner;
(63) “Unique identifier” means a number or other identifier assigned by protocols established by the automated licensing system approved by the commissioner; and
(64) “Whole loans” mean those loans in which a mortgage and the underlying credit risk is owned and held on the balance sheet of an entity with all ownership rights.