Monthly Summary of Mortgage Activities Georgia Department of Banking and Finance 2990 Brandywine Road, Suite 200, Atlanta, GA 30341-5565 MAY 2002 SUMMARY OF ACTIVITIES - MORTGAGE DIVISION ---------------------------------------------------------------------------------------------------------------------------------------------------**IMPORTANT NOTES** DISTRIBUTING THE MONTHLY SUMMARY: The Monthly Summary of Mortgage Activities is emailed each month to licensees. The Department requests that all licensees provide the Department a valid email 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 email address, please contact the Mortgage Division at dbfmort@dbf.state.ga.us or at 770-986-1633 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 first half of 2002 are due by September 1, 2002. If you have reported the "per loan" fees to the Department during the past 12 months or if you hold a Georgia Residential Mortgage Lender license, you will be mailed a "per loan" fee reporting form in the near future. Please use this form to remit your fees. 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 report. 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. The ANNUAL LICENSE RENEWAL - Renewal application forms were mailed February 7, 2002. A $300 late fine was assessed against licensees who failed to return the renewal application form prior to April 1, 2002. Licensees who do not complete the renewal process by June 30, 2002, will expire and must cease activities covered by the Georgia Residential Mortgage Act. Lenders whose license will expire will have to divest of their Georgia residential loan portfolios. Former licensees seeking to reinstate an expired license must file a complete new application supported by updated information (including fingerprint cards) on the principals and payment of all outstanding fines and fees. NEW BOND REQUIREMENT BEGINNING 2002 A reminder of the bond term requirements for those companies who write bonds for Mortgage Brokers and Lenders in the State of Georgia. In addition to the requirements contained in O.C.G.A. 7-1-1003.2 for a bond, Rule 80-11-4-.03 (2) of the Department states that beginning July 1, 2002, the bond requirement for a lender or broker license shall have a stated term of one year or less, and shall expire on June 30. A corporate surety or licensee that does not intend to renew a bond for a subsequent term shall notify the Department of such cancellation no later than June 1 of each year. Providing renewal policies to the Department in a timely manner will expedite the license renewal process each year. 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, Pennsylvania, and South Carolina have the requirement that brokers have a physical place of business in their home state. Georgia Fair Lending Act Questions, Inquiries, and Comments The Governor signed the Georgia Fair Lending Act (HB 1361) into law on April 22, 2002. The law is effective October 1, 2002 and affects all lenders and brokers who make home loans in Georgia. The Department asks you to send your questions, inquiries and comments to us on the Georgia Fair Lending Act by June 15, 2002, so that we all can prepare for the October 1 implementation date for this law. You may send these comments by email to gafla@dbf.state.ga.us or regular mail or by fax. We would greatly appreciate you referencing that your correspondence regards the Georgia Fair Lending Act in order to expedite the Department's handling of this correspondence. The Department intends to compile a question and answer database from this correspondence that we will post on our website www.gadbf.org as soon as possible before October 1, 2002. Thanks in advance for your help with this matter. EMPLOYMENT OF FELONS An unfortunate trend has been noticed in the Mortgage Industry in Georgia. While we rarely receive an application from an individual who is unable to complete the licensing requirements due to a problem with their criminal background, we often discover that these individuals are seeking employment from persons licensed by this Department. Please be reminded that the provisions of O.C.G.A. 7-1-1004(d) allow the Department to revoke any license where a felon is on staff. If the Department discovers that a licensee has employed a felon, the licensee will be fined $1,000 for each violation, and will be issued a Notice of Intent to Revoke their license. The Department intends to pursue this problem aggressively. 2002 LEGISLATIVE CHANGES TO ARTICLE 13 GEORGIA RESIDENTIAL MORTGAGE ACT (GRMA) Preliminary Overview of Law Changes The following is a brief recap of the significant 2002 housekeeping bill changes which affected the GRMA. The provisions of the legislative changes become effective July 1, 2002. Code Section 7-1-1004 Changes involve the criminal background check requirement for principals and employees of a licensee. The 2002 legislative changes provide for broader definitions of officers and directors, to include policy making employees of a company. This will ensure extended regulatory oversight into the demonstrated financial responsibility, good character, and ethical conduct of all individuals having responsibility for the affairs of the company. In addition, the new law creates a requirement for licensees to conduct Georgia Crime Information Center (GCIC) criminal background checks on their "covered employees," which is defined in the legislation. These changes will require the submission of fingerprint cards on the policy making employees (in addition to officers and directors) with any new license application made after July 1, 2002. 7-1-1004 (a) -- Relating to Officials of the Company This section provides for a broader definition of who the controlling principals are in a company, so as to include all policy making persons under the provisions of the law, regardless of title. The Department will now expect background and financial information on all such persons. 7-1-1004 (d) -- Felonies This code section pertains to the issuing or revoking of a license for any applicant or licensee who has been convicted of a felony involving moral turpitude. The legislative change added coverage to include "any individual who directs the affairs or establishes policy for the licensee," as noted above. 7-1-1004 (e) -- Conviction Data ` The Department continues to be authorized to perform BACKGROUND CHECKS and submit FINGERPRINT CARDS on all employees. ` The Department will handle background checks on directors, officers and policy makers. Fingerprint cards shall be submitted to the Department on these people with the initial application or as needed. Fees for processing shall also be submitted by applicants or licensees. 7-1-1004(f) New Section -- This section added the requirement that licensees and applicants obtain criminal background checks on covered employees. Covered employees are defined as those who work in this state and have authority to enter, delete, or verify any information on any mortgage loan application form or document. Applicants and Licensees must: ` Obtain criminal background checks on covered employees. These will generally be submitted to a local law enforcement agency and must be forwarded to and handled by the GCIC. ` If the GCIC report comes back with information indicating a possible felony or if the information indicates the employee has a criminal record in any state other than Georgia, the employer shall submit to the Department two complete sets of fingerprints of the employee, any other required information, and applicable investigation fees. This information will be submitted by the Department for further criminal background investigation. ` The law provides for a probationary employment period for covered employees of 90 days from date of hire during which the applicant or licensee can obtain satisfactory background data. If the employee is determined to be a convicted felon, the applicant or licensee must immediately correct this violation of 7- 1-1004(d). Code Section 7-1-1016 -- Advertising This section was changed to indicate that any advertisements disseminated in the state will contain identifying information and now must include the License Number along with the name and office address already required, and added a provision allowing for an advertiser (licensee) who is located in more than one state to list Georgia as a state in which they are licensed, but the advertisement must include the identifying information noted above. More Information A copy of the legislation affecting the GRMA is contained on the web site at: http://www.ganet.org/dbf/mortgage forms.html. CEASE AND DESIST ORDERS - Issued in May Advantage Home Mortgage, Inc., Marietta, GA - Cease and Desist Order issued 5-02-02 and became final 5-2202. Commerce Equity Mortgage Corporation, Marietta, GA - Cease and Desist Order issued on 05-03-02 and became final on 5-23-02. Financialcircuit.com, Campbell, GA - Cease and Desist Order issued 05-02-02 and became final on 05-22-02. Home Savers, LLC, Atlanta, GA - Cease and Desist Order issued 05-02-02 and became final on 05-22-02. Karrantza, Tracy, Atlanta, GA - Cease and Desist Order issued 05-02-02 and became final on 05-22-02. Wyatt Mortgage, Inc., Dublin, GA - Cease and Desist Order issued 05-03-02 and became final 05-23-02. LICENSEES/REGISTRANTS REVOKED, EXPIRED, SUSPENDED, WITHDRAWN OR DENIED IN MAY 2002 ID# 5632 6348 6543 6702 7369 11508 12265 13186 13194 NAME 1ST EQUITABLE MTG CO INC SEACOAST EQUITIES INC MINIEX, CRAIG ESSEX HOME MTG SVCNG CORP BALTIMORE AMERICAN MTG CO HAYNES, MAUREEN PIPELINE CORP PREFERRED HOME MTG CO BOYER FINL SERVS CODE BD LD BD LD LD BD BD LD BD REVOKED EXPIRED 05/21/2002 SUSPENDED 05/21/2002 WITHDRAWN 05/09/2002 05/16/2002 05/20/2002 05/14/2002 05/13/2002 05/15/2002 05/13/2002 05/13/2002 DENIED LICENSEES/REGISTRANTS REVOKED, EXPIRED, SUSPENDED, WITHDRAWN OR DENIED IN MAY 2002 ID# 13579 14203 14383 14444 14761 15145 15202 15515 15558 15762 15846 16038 16216 16249 16260 16384 16436 16772 16782 17192 17128 17273 NAME BURKE, JAMES H BYL BANK GRP HOMEOWNERS LOAN CORP PRATER, JIMMY L CITIES HOME MTG CORP HOME SECURE SVCS LLC ANVIL FUNDING CORP R&R MTG CO LLC PEACHTREE RENOVATORS INC INVESTMOR MTG ANCHOR MTG INC DUPONT MTG GRP, INC. UST MTG KIRBY'S HOMETOWN MTG INC TRIDENT MTG SVCS SELECT FINL GRP GOLD COAST MTG GRP INC STREETWISE MTG LLC PORTFOLIO ASSOCIATES INC SAYEED INTERNATIONAL MOBILITY FINANCIAL, INC PEOPLE TO PEOPLE, LLC CODE BD RD LD BD BD BD LD BD BD BD BD LD LD BD BD BD BD BD LD LD BD BD REVOKED EXPIRED 05/29/2002 05/21/2002 05/16/2002 05/21/2002 SUSPENDED WITHDRAWN 05/13/2002 05/06/2002 05/13/2002 05/08/2002 05/13/2002 05/13/2002 05/20/2002 05/13/2002 05/22/2002 05/13/2002 05/08/2002 05/13/2002 05/13/2002 05/16/2002 05/13/2002 05/13/2002 05/24/2002 05/03/2002 05/24/2002 DENIED TOTAL: 31 FINES ASSESSED IN MAY 2002 ID# ISSUE DATE FINE REASON FINE PAID DATE COMPANY NAME CITY ST 5640 05/13/2002 1099 $4000. Cobb Mortgage Professionals, Incorporated Atlanta GA 5640 05/13/2002 FILE $1500. Cobb Mortgage Professionals, Incorporated Atlanta GA 5867 05/07/2002 BR $250. 05/29/2002 Pine State Mortgage Corporation Atlanta GA 5867 05/07/2002 BR $250. 05/29/2002 Pine State Mortgage Corporation Atlanta GA 5867 05/07/2002 BR $250. 05/29/2002 Pine State Mortgage Corporation Atlanta GA 5867 05/07/2002 BR $250. 05/29/2002 Pine State Mortgage Corporation Atlanta GA 5903 05/06/2002 REN $300. Mortgage Associated Lending Corporation Decatur GA 5903 05/06/2002 NSF $25. Mortgage Associated Lending Corporation Decatur GA 6342 7340 7340 7340 05/22/2002 05/09/2002 05/09/2002 05/09/2002 OTH B&R B&R UL $250. $500. $500. $1000. Caversham Financial, Inc. Advantage Home Mortgage, Inc. Advantage Home Mortgage, Inc. Advantage Home Mortgage, Inc. Stockbridge GA Marietta GA Marietta GA Marietta GA 11544 11544 05/21/2002 UL 05/21/2002 FILE $1000. $500. First Equity Mortgage Services, Inc. Atlanta GA First Equity Mortgage Services, Inc. Atlanta GA FINES ASSESSED IN MAY 2002 ID# ISSUE DATE FINE REASON FINE PAID DATE COMPANY NAME CITY ST 12252 05/21/2002 UL $1000. American Mortgage Services, Inc. Norcross GA 12252 05/21/2002 FILE $1000. American Mortgage Services, Inc. Norcross GA 13177 05/01/2002 BR $250. 05/10/2002 Carteret Mortgage Corporation Centreville VA 13177 05/01/2002 OTH $250. Carteret Mortgage Corporation Centreville VA 13376 05/15/2002 NSF $25. 06/03/2002 Ernest H. Abernethy, Jr. Atlanta GA 14083 05/21/2002 FILE $500. Georgia Home Mortgage Network, Inc. Atlanta GA 15036 05/08/2002 CIC $500. Specialized Financial Services, Inc. Bedford TX 15308 05/09/2002 UL $1000. Celeste W. Smith Decatur GA 15308 05/09/2002 1013 $2000. Celeste W. Smith Decatur GA 15308 05/09/2002 FILE $500. Celeste W. Smith Decatur GA 15600 05/10/2002 BR $500. America's Mortgage Broker, LLC Tampa FL 15600 05/10/2002 OTH $500. America's Mortgage Broker, LLC Tampa FL 16218 05/10/2002 FEL $2000. First United Home Mortgage Corp Atlanta GA 16218 05/10/2002 B&R $500. First United Home Mortgage Corp Atlanta GA 16218 05/10/2002 B&R $500. First United Home Mortgage Corp Atlanta GA 16218 05/10/2002 B&R $500. First United Home Mortgage Corp Atlanta GA 16218 05/10/2002 B&R $500. First United Home Mortgage Corp Atlanta GA 16218 05/10/2002 B&R $500. First United Home Mortgage Corp Atlanta GA 16389 05/10/2002 UL $1000. 06/03/2002 Jerry Moore Snellville GA 16389 05/10/2002 B&R $500. 06/03/2002 Jerry Moore Snellville GA 16389 05/10/2002 OTH $500. 06/03/2002 Jerry Moore Snellville GA 16393 05/09/2002 B&R $500. 05/24/2002 A-1 Mortgage Broker Tucker GA FINE REASON 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 LAR NSF REL REN UL OTH FILE Loan files not properly maintained Late filing Written Annual Report 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 MAY 2002 ID# COMPANY NAME 5665 17224 17237 17279 17280 17281 17282 Georgia Mortgage, Inc. + Vinings Mortgage Corporation Best Rate Funding, Corp. Richard Dean Godfrey Lemuel F. Rich Kathleen E. Bergevin Ryan N. Hodges CITY ROSWELL SMYRNA SANTA ANA DULUTH DULUTH ALPHARETTA DULUTH ST MB CODE GA B GA B CA L GA B GA B GA B GA B ORIGINAL APPROVAL 06/22/1993 05/03/2002 05/03/2002 05/03/2002 05/03/2002 05/03/2002 05/03/2002 RENEWAL 05/03/2002 05/03/2002 05/03/2002 05/03/2002 05/03/2002 05/03/2002 05/03/2002 REINSTATED LICENSEES/REGISTRANTS APPROVED OR REINSTATED IN MAY 2002 ID# COMPANY NAME CITY 17284 16664 17201 17225 17251 17257 17287 17294 17295 7033 16146 16916 17146 17229 17255 17303 17305 17309 17311 17312 17313 17324 17331 11531 17244 17254 17259 17265 17267 17285 17307 17362 17363 17364 17367 17206 17253 17256 17268 17270 17271 17286 17317 17378 7462 7332 Chad Everett Jordan Best Mortgage and Finl + PowerPlus Mortgage, Inc. Warren Rodney Morrison Heartland Home Mortgage, Inc. Axis Mortgage, Inc. Patricia Knight Diversified Lending, Inc Pathfinder Financial Services, Inc. Mtg Connection, LLC (The) + AAA Mortgage Group MasterLink US & International, American Finance House Lariba America's Discount Lenders, Inc. Truth and Lending, Inc. Karl J. Crawford Randall Scott Oakley Yvonne Manning Rogers Jason D. Gann Carl M. Fenner Monica Lynne Waddell Benton Adam Wood Tony M. Steele Hometrust Mortgage , Inc. + Reliant Mortgage Company, LLC TriStar Mortgage Services, Inc. Real Estate Capital Mortgage Russell H. Hippe, III Jefferson Capital Lending, LLC Jamie Blackstock Edward Adam Chorba Donald G. Turnbull Jonas M. Courey Vera Jane Andrews Craig W. Morgan Heritage Financial, Inc Keith Ross Cherokee Elite Mortgage, Inc. Sundance Financial Services, Inc. Saburi Olafuyi Stellar Mortgage Corporation Guidance Residential, LLC Atlantic States Mortgage Fannie M. Billings DC Enclosures, Inc. Baron Homes of North GA, Inc. DULUTH OAK BROOK HERNDON SMYRNA ACWORTH ATLANTA DACULA WATKINSVILLE DAHLONEGA SMYRNA SMYRNA POMONA PASADENA CAPE CORAL MIRAMAR CALHOUN MARIETTA CHAMBLEE CALHOUN DECATUR COLUMBUS BUFORD ATLANTA ATLANTA WAKEFIELD LITHIA SPRINGS ALPHARETTA ATLANTA ATLANTA CALHOUN ROSWELL AUGUSTA CALHOUN ATLANTA MABLETON HIXSON DOUGLAS CANTON ATLANTA BUFORD ATLANTA FALLS CHURCH STOCKBRIDGE WARNER ROBINS KENNESAW CUMMING ST MB CODE GA B IL B GA B GA B GA B GA B GA B GA B GA B GA B GA B CA B CA L FL B FL B GA B GA B GA B GA B GA B GA B GA B GA B GA B MA L GA B GA B GA B GA B GA B GA B GA B GA B GA B GA B TN B GA B GA B GA B GA B GA B VA L GA B GA B GA B GA B ORIGINAL APPROVAL 05/03/2002 08/17/2001 05/10/2002 05/10/2002 05/10/2002 05/10/2002 05/10/2002 05/10/2002 05/10/2002 11/04/1994 05/17/2002 05/17/2002 05/17/2002 05/17/2002 05/17/2002 05/17/2002 05/17/2002 05/17/2002 05/17/2002 05/17/2002 05/17/2002 05/17/2002 05/17/2002 04/12/1996 05/24/2002 05/24/2002 05/24/2002 05/24/2002 05/24/2002 05/24/2002 05/24/2002 05/24/2002 05/24/2002 05/24/2002 05/24/2002 05/31/2002 05/31/2002 05/31/2002 05/31/2002 05/31/2002 05/31/2002 05/31/2002 05/31/2002 05/31/2002 11/24/1995 03/15/1996 RENEWAL 05/03/2002 05/10/2002 05/10/2002 05/10/2002 05/10/2002 05/10/2002 05/10/2002 05/10/2002 05/10/2002 05/17/2002 05/17/2002 05/17/2002 05/17/2002 05/17/2002 05/17/2002 05/17/2002 05/17/2002 05/17/2002 05/17/2002 05/17/2002 05/17/2002 05/17/2002 05/17/2002 05/24/2002 05/24/2002 05/24/2002 05/24/2002 05/24/2002 05/24/2002 05/24/2002 05/24/2002 05/24/2002 05/24/2002 05/24/2002 05/24/2002 05/31/2002 05/31/2002 05/31/2002 05/31/2002 05/31/2002 05/31/2002 05/31/2002 05/31/2002 05/31/2002 05/03/2002 05/10/2002 REINSTATED 05/03/2002 05/10/2002 LICENSEES/REGISTRANTS APPROVED OR REINSTATED IN MAY 2002 ID# COMPANY NAME 14160 A Better Rate Mortgage Of 12974 Peach Plus Financial Inc. CITY SNELLVILLE DUNWOODY ST MB CODE GA B GA B ORIGINAL APPROVAL 12/04/1998 11/14/1997 RENEWAL 05/10/2002 05/24/2002 REINSTATED 05/10/2002 05/24/2002 TOTAL: 55 B = BROKER L = LENDER R = REGISTRANT + Downgrade Lender to Broker * Upgrade Broker to Lender