§ 6123 — Mortgage loan business prohibitions

Pennsylvania § 6123

• Jurisdiction: Pennsylvania
• Title 7: BANKS AND BANKING
• Part: PART II
• Ch. 61: MORTGAGE LOAN INDUSTRY LICENSING AND CONSUMER PROTECTION
• Subch.: MORTGAGE LOAN BUSINESS RESTRICTIONS AND REQUIREMENTS

Text

(a) Mortgage loan business prohibitions.--A licensee engaging in the mortgage loan business shall not:

(1) Charge, contract for, collect or receive charges, fees, premiums, commissions or other considerations in excess of the limitations of those contained in this chapter.

(2) Disburse the proceeds of a mortgage loan in any form other than cash, electronic funds transfer, certified check or cashier's check where the proceeds are disbursed by the licensee to a closing agent. This paragraph shall not be construed as requiring a lender to utilize a closing agent and shall not apply to disbursements by check directly from the licensee's account payable to the consumer, consumer designees or other parties due funds from the closing.

(3) Advertise, cause to be advertised or otherwise solicit whether orally, in writing, by telecast, by broadcast or in any other manner any statement or representation which is false, misleading or deceptive.

(4) Require a consumer to pay, to the licensee or any other person, a broker's fee, finder's fee, commission, premium or any other charges for obtaining, procuring or placing of a mortgage loan, except as provided under this chapter. This restriction shall not prohibit a mortgage lender from paying a fee to a mortgage broker in connection with the placement or procurement of a mortgage loan nor prohibit a consumer from requesting or directing a mortgage lender licensee to pay a fee from the proceeds of a mortgage loan or include it in the amount to be financed.

(5) Make any mortgage loan on the condition, agreement or understanding that the consumer contract with any specific person or organization for insurance services as agent, broker or underwriter.

(6) (Deleted by amendment).

(7) In the case of a mortgage broker or mortgage originator, commit to close or close mortgage loans in its own name, service mortgage loans, enter into lock-in agreements or collect lock-in fees or be or designate the exclusive recipient of notices or other communications sent from a lender or servicer to a consumer, provided, however, that a mortgage broker or mortgage originator can provide a lender's lock-in agreement to a consumer on behalf of that lender and collect lock-in fees payable to that lender on the lender's behalf.

(8) In the case of a mortgage originator, accept any fees from consumers in the mortgage originator's own name. A mortgage originator may accept fees payable to the mortgage originator's sponsoring licensee and fees payable to third-party entities on behalf of the mortgage originator's sponsoring licensee. A mortgage originator may not accept advance fees payable to the mortgage originator's sponsoring licensee unless the licensee is authorized to collect advance fees under this chapter.

(9) In the case of a mortgage originator, engage in the mortgage loan business other than on behalf of the single mortgage broker or mortgage lender or a person excepted from this chapter or a person excepted from licensure under section 6112 (relating to exceptions to license requirements) that sponsors the mortgage originator.

(b) Mortgage loan servicer prohibitions.--A licensee engaging in the mortgage servicer business shall not fail to establish or attempt to establish a single point of contact with whom a borrower can communicate about foreclosure matters or loss mitigation options later than the 36th day of a borrower's delinquency, unless contact is inconsistent with applicable bankruptcy law or court order.

Legislative History

(June 29, 2009, P.L.51, No.10, eff. 60 days; July 2, 2013, P.L.210, No.38, eff. 60 days; Dec. 22, 2017, P.L.1260, No.81; Feb. 3, 2022, P.L.24, No.8, eff. 60 days) 2022 Amendment.Act 8 amended subsec. (a)(9) and deleted subsec. (a)(6). 2017 Amendment.Act 81 amended the intro. par. and added subsec. (b). Section 9(2) of Act 81 provided that the amendment of section 6123 shall take effect upon the effective date of regulations promulgated under section 6141 of this title. 2013 Amendment.Act 38 amended par. (8) and added par. (9). 2009 Amendment.Act 10 amended par. (7). Cross References.Section 6123 is referred to in section 6112 of this title.