Monthly summary of mortgage activities, Jan. 2003

Monthly Summary of Mortgage Activities
Georgia Department of Banking and Finance
2990 Brandywine Road, Suite 200, Atlanta, GA 30341-5565
JANUARY 2003 SUMMARY OF ACTIVITIES - MORTGAGE DIVISION
---------------------------------------------------------------------------------------------------------------------------------------------------**IMPORTANT NOTES**
DISTRIBUTING THE MONTHLY SUMMARY: The Monthly Summary of Mortgage Activities is E-mailed each month to licensees. The Department requests that all licensees provide the Department a valid E-mail address in order to receive the Monthly Summary each month in a timely manner. For all other licensees, the Monthly Summary is available on the Department's website http://www.state.ga.us/dbf/bulletins.html each month. This delivers the Mortgage Summary to you more rapidly and efficiently. If you have not already provided the Department with your E-mail address, please contact the Mortgage Division at dbfmort@dbf.state.ga.us or at 770986-1633 if you have any questions.
Licenses issued in Georgia are subject to revocation, withdrawal or suspension. To verify the current status of a license call 770-986-1269 or check our web site at http://www.state.ga.us/dbf/
PER LOAN FEES - "Per loan" fees for the second half of 2002 are due by March 1, 2003. If you hold a Georgia Residential Mortgage Lender license, you should have received a Reporting Form in January 2003. Please use this form to remit your fees. Contact the Department or use the internet if you did not receive your form. Regardless of the volume of loans (even "0" loans closed), you should send in the fee report. If you are a licensed mortgage broker or if you are exempt from licensing or registration a copy of the "per loan" fee reporting form can be found on our website or in Rule 80-5-1-.04 (2) issued by this Department. The fine for late filing of your Per Loan Fees is $1,000. These fines will be posted to the delinquent licensees. If you do not close the loan in your name, and your name is not on the security deed - you do not owe any "per loan" fees. Proper payment of these fees will be monitored by our examination team. Failure to pay the fees may result in non-renewal of your license.
The ANNUAL LICENSE RENEWAL process is now underway. Renewal application forms for the fiscal year 2004 mortgage licenses will be distributed beginning February 5, 2003. A $300 late fine will be assessed against licensees who fail to return the renewal application form prior to April 1, 2003. As in prior years, all outstanding issues such as fines, fees, stale audits, complaint resolution, etc. must be resolved before your renewal license will be granted. Licensees who do not complete the renewal process by June 30, 2003, will have their licenses expire, and will have to cease operations. If you have not received your renewal application forms by February 28, 2003, please contact the Department immediately.
SUPERVISION OF BRANCHES REQUIRED IN GEORGIA PURE"NET BRANCHES" ARE NOT ALLOWED
About once a month a licensee is shocked to discover that their license is being revoked due to "mistakes" made at one of their branch offices. The licensees often claim that they had no control over the operations at that branch because it was a "net" branch! Just in case you have missed reading and understanding the branching laws in

Georgia: T raditional "NET" BRANCH RELATIONSHIPS ARE NOT PERMITTED BY THE GEORGIA CODE. O.C.G.A. Section 7-1-1006 (g) requires that when a licensee applies for a branch, they must submit the name of the person that they have hired (and are responsible for the supervision of ) to run that office. See the Department's Rule 80-11-1-. 04. The activities of that office and the actions of its manager and employees are the responsibility of the licensee (Section 7-1-1002 (c)). We have discovered some lender and broker licensees selling "franchises" in Georgia to use their name. In several instances, unapproved offices were then opened at unapproved locations using copies of the license from legitimate locations. When we discover a lender and a broker allowing operation from an unapproved location or net branch (whether a "franchise" or not), the lender is fined $250 for each unapproved location and $250 for each unapproved branch manager. Revocation procedures against that licensee may be initiated as provided for in Section 7-1-1002 (c) and 7-1-1017 and the lender may be fined $1,000 for each loan generated from an unapproved location.
The fine for permitting an unlicensed location to operate is $250 (See rule 80-11-3-.01 (c). The fine for permitting a branch to be managed by an unapproved individual is $250 (Rule 80-11-3-.01 (n)). Background checks must be performed on all branch managers (Rule 80-11-1-.04 (b)). Please refer to the comments elsewhere in this summary regarding the penalties for employment of a felon who has not complied with the remedies provided by Section 7-1-1004 (d).
We often find that these unapproved branch offices are managed by individuals who have criminal or credit background problems and are unable to obtain a license in their own name. We also often find that after an unapproved branch and its manager cause the licensee to have its license revoked, this unapproved branch manager will open an unapproved branch for another licensee. The cycle continues until the licensees take responsibility for the individuals they hire and perform proper background checks on these individuals (Section 7-11004 (f)), and obtain approval (required by Section 7-1-1006 (f)) for the branch location that they intend to operate. The "branch manager" of a net branch may receive a "Cease and Desist Order" for operating an unlicensed location (Section 7-1-1002). If this results in a final a Cease and Desist Order, he or she will be barred from working in the industry for three years (Section 7-1-1004 (i)).
The Department will consider the following factors in determining whether an office location qualifies as a branch or is a separate business/legal entity which must be licensed separately. Other criteria may be added as this issue develops.
1. The owner or lessee of the property location proposed as a branch.
2. Whether branch managers and employees are supervised W-2 employees of the applicant/licensee or unsupervised independent contractors paid on a 1099 basis.
3. All required books and records must be maintained at the principal place of business (Rule 80-11-2-.01). Income and expense items must be accounted for on the books of the licensee at the main location. No separate books and records may be maintained for each location (although subsidiary records may be maintained for convenience purposes).
4. If the licensee is a lender, they must provide funding for the loans generated by that branch. It is not appropriate for a lender's branch to broker loans to other lenders.
5. The licensee must have consistent policies and procedures and quality control for loan origination and processing that are enforced at all the branches.
6. The financial and employee records for the branch need to be kept at the main office. Payroll should originate at the main office.
While these factors may not negate approval of an application for a legitimate branch, they are used to evaluate whether or not a branch application or an application for a license is appropriate and needed.

SURETY BONDS AND RENEWALS
Beginning July 1, 2002, the law was changed regarding the surety bond. In addition to the requirements contained in O.C.G.A. 7-1-1003.2 for a bond, the bond requirement for any lender or broker license utilizing a bond is such that the bond shall have a stated term of one year or less, and shall expire on June 30 of each year.
Please remember that in order to renew your license a current bond must be in effect. The bonding companies will notify the Department of any cancellations 30 days prior to the expiration date fo the bond. If the Department received a cancellation notice regarding any licensee in June, the license will NOT be renewed unless the Department receives notice of reinstatement of the bond prior to expiration.
Licensees using bonds are encouraged to review the status of their bond with their bonding company to facilitate the renewal of their license and prevent the issuance of a revocation notice.
LOAN PROCESSORS
The Department is considering a change in its policy regarding third party, independent mortgage loan processors. If the Department makes the changes under consideration, third party, independent mortgage loan processors will be required to be licensed as a mortgage broker or be an exclusive, W-2 employee of a single mortgage licensee. Heretofore, the Department has allowed third party, independent mortgage loan processors to be excluded from the licensing requirements and has allowed mortgage licensees to do business with unlicensed mortgage loan processors or mortgage loan processing companies. The Georgia Fair Lending Act specifically addresses loan processors and includes "processing" in its definition of `creditor'. Additionally, loan processing now involves considerably more consumer contact. This exclusion may no longer be permitted by the Georgia Residential Mortgage Act (GRMA). Third party, independent mortgage loan processors may need to be licensed or qualify for the employee exemption permitted under GRMA. If the Department's policy does change, notice will be provided to existing licensees through future editions of the Monthly Summary and its website, www.state.ga.us/dbf. New licensees will be notified at the time their license is issued.
OUT OF STATE BROKERS
The Official Code of Georgia Section 7-1-1003.1 states, in part, that if the applicant for a new or renewal mortgage broker license does not have a physical place of business in Georgia, then a license or a renewal may only be issued if the applicant's home state also does not require that in order to be licensed a mortgage broker must have a physical place of business in their home state. This location must be staffed by at least one supervised employee. It can not be a post office box or any other place where the public receives mail, deliveries, or messages. Currently the states of Alabama, Massachusetts, New Jersey, North Carolina, Pennsylvania, South Carolina, and Texas have the requirement that brokers have a physical place of business in their home state.
FINAL CONSENT ORDER
On January 29, 2003, the Department entered a Consent Order with Leadership Mortgage Services, Inc. #5977

LICENSEES/REGISTRANTS REVOKED, EXPIRED, SUSPENDED, WITHDRAWN OR DENIED IN JANUARY 2003

ID#
5977 6545 6646 11777 12498 15289 15589 16198 16212 16753 17949

NAME
LEADERSHIP MTG SVCS INC PIONEER CREDIT CO CHATTAHOOCHEE MTG CORP GA FIN GRADY CO INC MISSION HILLS MTG BANKER ADVANTAGE INVESTORS ALLIANCE LENDING, LLC MTG MAKERS SENECA FINL GRP LLC OLD CAP MTG INC FIRST MUTUAL CORP

CODE
BD LD BD BD LD LD BD BD BD BD LD

REVOKED
01/29/2003
01/06/2003

EXPIRED

SUSPENDED WITHDRAWN
01/10/2003 01/17/2003 01/10/2003 01/21/2003 01/31/2003 01/24/2003
01/15/2003 01/01/2003 01/31/2003

DENIED

TOTAL: 11

FINES ASSESSED IN JANUARY 2003

ID#

ISSUE

DATE

FINE REASON

FINE

PAID DATE

COMPANY NAME

CITY

ST

5622 5622

01/09/2003 FILE 01/09/2003 FILE

$500. $3000.

Misra Group, Inc. Misra Group, Inc.

Kennesaw

GA

Kennesaw

GA

5622 5626 5781 5798

01/09/2003 01/15/2003 01/24/2003 01/17/2003

B&R FEL FEL B&R

$500. $1000. $1000.
$500.

Misra Group, Inc.

Kennesaw

GA

Peoples Loan and Finance Corporation

Marietta

GA

First Atlantic Mortgage, LLC of Georgia

Norcross

GA

Hammond Crossing Mortgage Co., Inc.

Atlanta

GA

5831 5831 5831 5831 5974

01/08/2003 01/08/2003 01/08/2003 01/08/2003 01/08/2003

MGR B&R FILE FILE B&R

$250. $500. $500. $500. $500.

Equity One, Inc. Equity One, Inc. Equity One, Inc. Equity One, Inc. Mortgagequote.Com, Inc.

Marietta

GA

Marietta

GA

Marietta

GA

Marietta

GA

Atlanta

GA

5991 6009 6009 6350

01/17/2003 01/10/2003 01/10/2003 01/17/2003

AUD B&R FILE AUD

$1000. $500. $500.
$1000.

Swainsboro Financial Services Inc.

Swainsboro

GA

Mainstreet Mortgage Makers, Inc.

Tampa

FL

Mainstreet Mortgage Makers, Inc.

Tampa

FL

Ben Hill Finance Company

Fitzgerald

GA

6380 01/14/2003 B&R

$500.

Atlas Mortgage Corporation

Atlanta

GA

6380 01/14/2003 FILE

$1000.

Atlas Mortgage Corporation

Atlanta

GA

6772 01/17/2003 AUD

$1000.

American Home Mortgage Co.

Chattanooga

TN

7064 01/09/2003 FILE

$500. 01/30/2003 Capital City Mortgage Investments, Inc.

Atlanta

GA

7080 7333 12440 12440

01/14/2003 01/14/2003 01/09/2003 01/09/2003

FILE FEL FILE FILE

$500. $1000.
$500. $500.

Northside Mortgage Group, Inc.

Alpharetta

GA

Georgia Housing Center, Inc.

Athens

GA

Tri Com Mortgage, Inc.

Atlanta

GA

Tri Com Mortgage, Inc.

Atlanta

GA

13795 01/17/2003 AUD

$1000.

Golden First Mortgage Corp.

Melville

NY

FINES ASSESSED IN JANUARY 2003

ID#
14118 14639 14639 14639 14639 14639 14747 15243 15251 15251 15380 15873 15873 16059 16429 16861 16894 16942 16974 16985 17134

ISSUE DATE
01/10/2003 01/08/2003 01/08/2003 01/08/2003 01/08/2003 01/08/2003 01/08/2003 01/17/2003 01/17/2003 01/17/2003 01/17/2003 01/14/2003 01/14/2003 01/17/2003 01/24/2003 01/17/2003 01/17/2003 01/17/2003 01/17/2003 01/17/2003 01/17/2003

FINE REASON
B&R BR MGR REL UL FILE B&R AUD UL FILE AUD B&R FILE AUD FILE AUD AUD AUD AUD AUD AUD

FINE
$500. $250. $250. $250. $5000. $500. $500. $1000. $1000. $500. $1000. $500. $500. $1000. $500. $1000. $1000. $1000. $1000. $1000. $1000.

PAID DATE

COMPANY NAME

CITY

ST

Emerald Residential Mortgage, Inc.

Roswell

GA

Capital Mortgage & Financial Group, Inc.

Atlanta

GA

Capital Mortgage & Financial Group, Inc.

Atlanta

GA

Capital Mortgage & Financial Group, Inc.

Atlanta

GA

Capital Mortgage & Financial Group, Inc.

Atlanta

GA

Capital Mortgage & Financial Group, Inc.

Atlanta

GA

BJD Mortgage Company, Inc.

Jacksonville

FL

Rhodes Financial Services

Evans

GA

Joseph Corey Quintons, Sr.

Ellenwood

GA

Joseph Corey Quintons, Sr.

Ellenwood

GA

All Credit Mortgage Lenders, LLC

College Park

GA

Dunn's Underwriters & Financial Services

Norcross

GA

Dunn's Underwriters & Financial Services

Norcross

GA

First Start Mortgage Corporation

Atlanta

GA

CITIMUTUAL Corporation

Suwanee

GA

Home Services Financial, LLC

Chattanooga

TN

Impact Lending, Inc.

NEW PORT RICHEY

FL

American Lending Corporation

Owings Mills

MD

Novelle Financial Services, Inc.

San Diego

CA

TCIF, LLC

Armonk

NY

1st Preference Mortgage Corporation

Baltimore

MD

FINE REASON

1013 Prohibited Acts 1099 1099 employees

B&R BR CD CIC EMP FEE

Books & records Unapproved branch Violation of Cease & Desist Order Acq. of 25% ownership without approval Employer under C&D or revocation $6.50 fees not paid

FILE
MGR NSF REL REN UL OTH

Loan files not properly maintained LAR Late filing Written Annual
Report Unapproved branch managers
Check returned for insufficient funds Relocation of office without notice
Renewal filed late Doing business with unlicensed entity
Miscellaneous other

LICENSEES/REGISTRANTS APPROVED OR REINSTATED IN JANUARY 2003

ID# COMPANY NAME
17713 Scotty Lewis

CITY
LAWRENCEVILLE

ST MB CODE
GA B

ORIGINAL APPROVAL
01/03/2003

RENEWAL
01/03/2003

REINSTATED

LICENSEES/REGISTRANTS APPROVED OR REINSTATED IN JANUARY 2003

ID# COMPANY NAME

CITY

17727 17792 17867 17882 17915 17939 17969 18016 18018 18024 18027 18031 18032 18037 18038 17685 17781 17839 17881 17885 17886 17887 17984 17997 17999 18010 18011 18012 18022 18033 18044 15031 17638 17646 18029 18051 18052 18053 18054 18063 18064 18066 18071 17470 17776 17841

Merit Financial, Inc. MoneyTree Lending Sandy L. Studle GlobalTech Financial, LLC RateCapital, Inc. RHR Mortgage of America, LLC Sapienza Mortgage, Inc. Barry W. Love George M. Linskey Patricia Felicia Glenn Jon A. Massey Dave D. Harden Howard E. Hightower Dana Lynn Carnes Arturo G. Gil David K. Christie Founders Mortgage USA, LLC Ronald N. Ray AEGIS Funding Corporation AEGIS Wholesale Corporation Moulton Mortgage Corporation AEGIS Lending Corporation James L. Hawkins Hometown Equity Mortgage of Total Mortgage Processing, Inc. Blue Star Home Inc. Allied Home Mortgage Corporation Spires Mortgage Corporation Edward W. Tokash Calvin Moody GHS Homes, Inc. Streamline Holding, LLC * Donald Johnson Jacqueline Diane Bridges Speciality Mortgage Katy Fenbert Ling Poon Chan Jennah Es-Sudan Virginia R. Smith Boswell Financial Associates, Genevieve Thomas William John Ridge Andina Financial Services, Inc Financial Solutions of Pensacola Guarantee Mortgage Patti O. Souther

KIRKLAND MODESTO GRIFFIN ATLANTA VIENNA FRANKLIN ATLANTA CARTERSVILLE CALHOUN AUSTELL COMMERCE CUMMING MACON MARIETTA ALPHARETTA LAGRANGE WOODSTOCK CEDARTOWN HOUSTON HOUSTON HOUSTON HOUSTON MACON ATLANTA ATLANTA RICHMOND HILL HOUSTON GRAYSON JONESBORO CLARKSTON MILLEN NAPLES MARIETTA RINGGOLD ATLANTA DECATUR ATLANTA STONE MOUNTAIN CARTERSVILLE PEACHTREE CITY NORCROSS PORTLAND NORCROSS CHATTANOOGA PENSACOLA MONROE

ST MB CODE

WA L CA L

GA B GA L VA B TN L

GA B GA B GA B GA B

GA B GA B GA B GA B

GA B GA B GA L GA B

TX L GA L TX L TX L GA B

GA B GA B GA B TX L

GA B GA B GA B GA B

FL

L

GA B

GA B

GA B

GA B GA B GA B GA B

GA B GA B OR B GA B

TN B

FL

L

GA B

ORIGINAL APPROVAL
01/03/2003 01/03/2003 01/03/2003 01/03/2003 01/03/2003 01/03/2003 01/03/2003 01/03/2003 01/03/2003 01/03/2003 01/03/2003 01/03/2003 01/03/2003 01/03/2003 01/03/2003 01/10/2003 01/10/2003 01/10/2003 01/10/2003 01/10/2003 01/10/2003 01/10/2003 01/10/2003 01/10/2003 01/10/2003 01/10/2003 01/10/2003 01/10/2003 01/10/2003 01/10/2003 01/10/2003 10/01/1999 01/17/2003 01/17/2003 01/17/2003 01/17/2003 01/17/2003 01/17/2003 01/17/2003 01/17/2003 01/17/2003 01/17/2003 01/17/2003 01/24/2003 01/24/2003 01/24/2003

RENEWAL
01/03/2003 01/03/2003 01/03/2003 01/03/2003 01/03/2003 01/03/2003 01/03/2003 01/03/2003 01/03/2003 01/03/2003 01/03/2003 01/03/2003 01/03/2003 01/03/2003 01/03/2003 01/10/2003 01/10/2003 01/10/2003 01/10/2003 01/10/2003 01/10/2003 01/10/2003 01/10/2003 01/10/2003 01/10/2003 01/10/2003 01/10/2003 01/10/2003 01/10/2003 01/10/2003 01/10/2003 01/17/2003 01/17/2003 01/17/2003 01/17/2003 01/17/2003 01/17/2003 01/17/2003 01/17/2003 01/17/2003 01/17/2003 01/17/2003 01/17/2003 01/24/2003 01/24/2003 01/24/2003

REINSTATED

LICENSEES/REGISTRANTS APPROVED OR REINSTATED IN JANUARY 2003

ID# COMPANY NAME

CITY

17929 17931 17948 17965 17974 17993 17995 18014 18026 18060 18061 18070 18080 18084 18091 17821 17932 17962 17975 18059 18077 18085 18088 18089 18090 18092 18095 18105
5961 6312 11925 11321

James Ray Mitchell, Sr. BSM Financial, LP Enreal Lending, Inc. Giovanni Murillo Best Group Mortgage, Inc. Alfred J. Jones Isabelle Waldrep Mitchell Brinkley, III Jimmy Watts First American Mortgage Group, Mortgage Resource Mortgage Group USA, Inc. Newpoint Mortgage, LLC Capital Services Group, Inc. Nichole P. Hilliard David C. Bankston Mortgage Source, LLC (New Eleanor M. Wong American United Mortgage Thomas Crews Haven Mortgage, LP Phayly Chong ATCO Mortgage, Inc. Greg Alan Little Jim Weeks UBS PaineWebber Inc. ARGO Mortgage and Investment, Morris Mortgage Corporation Mortgage Information Services Berno I. Pettersson Peach State Financial Group, Inc. Lastinger Mobile Homes, Inc.

LOUISVILLE ADDISON ATLANTA DULUTH NORCROSS MACON FORSYTH MACON COLUMBUS MIDLAND ATLANTA INDIANAPOLIS LAWRENCEVILLE ROSWELL PELHAM AMERICUS LAWRENCE ATLANTA ATLANTA MARIETTA EDISON MARIETTA MANCHESTER MARIETTA PALMETTO WEEHAKEN DAYTONA BEACH CORAL SPRINGS COLUMBUS PERRY DALLAS DUBLIN

ST MB CODE

GA B TX L

GA B GA B GA B GA B

GA B GA B GA B GA B

GA B

IN

L

GA B

GA B

GA B GA B NY B GA B

GA B GA B NJ B GA B GA B

GA B

GA B

NJ B

FL

L

FL

B

GA B

GA B

GA B

GA B

ORIGINAL APPROVAL
01/24/2003 01/24/2003 01/24/2003 01/24/2003 01/24/2003 01/24/2003 01/24/2003 01/24/2003 01/24/2003 01/24/2003 01/24/2003 01/24/2003 01/24/2003 01/24/2003 01/24/2003 01/31/2003 01/31/2003 01/31/2003 01/31/2003 01/31/2003 01/31/2003 01/31/2003 01/31/2003 01/31/2003 01/31/2003 01/31/2003 01/31/2003 01/31/2003 06/11/1993 06/22/1993 12/13/1996 02/02/1996

RENEWAL
01/24/2003 01/24/2003 01/24/2003 01/24/2003 01/24/2003 01/24/2003 01/24/2003 01/24/2003 01/24/2003 01/24/2003 01/24/2003 01/24/2003 01/24/2003 01/24/2003 01/24/2003 01/31/2003 01/31/2003 01/31/2003 01/31/2003 01/31/2003 01/31/2003 01/31/2003 01/31/2003 01/31/2003 01/31/2003 01/31/2003 01/31/2003 01/31/2003 05/01/2001 04/03/2002 05/20/2002 01/17/2003

REINSTATED
01/10/2003 01/10/2003 01/10/2003 01/17/2003

TOTAL: 79

B = BROKER L = LENDER R = REGISTRANT

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