Monthly summary of mortgage activities, Sept. 2004

Monthly Summary of Mortgage Activities
Georgia Department of Banking and Finance
2990 Brandywine Road, Suite 200, Atlanta, GA 30341-5565 # Telephone (770) 986-1269 # Fax (770) 986-1029 #
FOR THE PERIOD ENDING SEPTEMBER 2004
SUMMARY OF ACTIVITIES - MORTGAGE DIVISION
WEB SITE: www.state.ga.us/dbf
NEWS ITEMS
BRANCH/BRANCH MANAGER FINE AMNESTY PROGRAM
From October 15, 2004 through December 31, 2004 the Department will be offering a one-time branch, branch manager, & branch relocation application/registration FINE amnesty program.
AT ISSUE It has become apparent over the years that, either inadvertently or deliberately, licensees fail to meet the branching provisions of the Georgia Residential Mortgage Act. Basically, branches, branch managers, relocations and other branch related changes must be reported. Failure to meet these obligations subjects the licensee to fines and/or other sanctions.
Failure to meet these provisions of the law presents several problems for consumers, other members of the industry, and the Department. Consumers need to know with whom they are dealing and that the company is compliant with the law. Lenders look to see if the branch they are dealing with is properly approved by the Department and known by the licensee, or if it is a net branch or sham operation. The Department is responsible for determining the law is being complied with so that the consumers, lenders, and others are able to know that they are dealing with licensees who meet the provisions of the Georgia Residential Mortgage Act. The problem of unreported branches and changes in branches is often extensive, and this particularly poses a problem during the annual renewal process. Most licensees who have failed to apply for new branches or failed to report changes in branch matters often report them at renewal. At that time the volume of work being performed to complete renewals during a required mandatory renewal time frame makes it difficult to complete renewal applications for our licensees, and makes timely renewal difficult for the licensee when a previously unreported branch or manager is then reported.
SOLUTION To reduce the reporting burden at renewal time and to get all new branches and branch managers approved and branch locations properly approved and reported prior to the renewal period, the Department is offering a one-time Branch Fine Amnesty Program for the registration of unreported branches and their managers, branch relocations, and changes in managers of previously approved branches. Under the amnesty program provisions, licensees would be able to apply for approval of any branch not previously approved, report changes in managers not previously approved, and report relocation of approved branches without paying the fine for previous failures to do so. However, it is important to note that the branch itself and the proposed manager, even if currently operating an unapproved branch, may NOT be approved. In those instances, the branch must be closed or the manager replaced with an acceptable manager. Failure to do so WILL then result in fines being assessed.

WHAT TO DO
Under this program, which will run from October 15, 2004 to December 31, 2004, a licensee may submit applications for new branches, changes in branch managers, and relocations of existing branches with no questions asked. The applicant must, however, submit the appropriate application and applicable fees. The following guidelines will apply:

BRANCH FINE
AMNESTY PROGRAM Complete
Branch, Branch Manager or Relocation Applicationwww.state.ga.us/dbf/ mortgage_forms.html
Submit
application with payment-$350 per new branch application
Applications
accepted until December 31, 2004 with NO FINES assessed
Applications
after 12-31-2004 $500 fine per unapproved branch, unapproved branch manager, or unapproved branch relocation in addition to application fees.

Examinations: Examinations conducted during this period will cite violations of GRMA code sections related to unapproved branches and branch managers, unapproved branch manager changes, and unreported branch relocations, but no fines will be assessed.
Applications and Fees: Completed branch applications must be submitted and all applicable fees for new branches will be assessed - $350 per branch application. Branch Managers submitted with the application will require background checks. Fingerprint card fees will only be paid if fingerprint cards are requested by the Department This fee is $30 per set of fingerprint cards (2 cards to a set). A Branch Manager Approval only application is also available.
Managers: Proposed managers who have issues that prevent them from working in the industry, pursuant to the provisions of GRMA, will continue to be rejected as branch managers. This is a FINE amnesty program only. The other qualifying provisions of the Act are not being circumvented.
Other Branch Application Fees: Branch relocation applications and change in branch management forms for any new branch managers of previously approved existing branches should be submitted for approval. However, there is no fee associated with these applications.
Branches Only!!: Other applications, such as a change in principal officers of a licensee or changes in control, etc., DO NOT fall into this amnesty program. Fines for failure to report these changes will continue to be assessed.

PROGRAM RUN DATES
Remember applications must be received by close of business Friday, December 31, 2004 in order to avoid fines. Applications for new branches, change of address, or change in branch manager can be found on the web at www.state.ga.us/dbf/mortgage_forms.html.

CONTACT US Should you have any questions about the program, the Department has set up an e-mail address for your convenience at dbfmort@dbf.state.ga.us. In addition, you may call the Mortgage Division at 770/986-5035.
NOTICE OF FINAL RULEMAKING: SEPTEMBER 3, 2004 On September 3, 2004, the Department of Banking and Finance published a notice of final rulemaking regarding the adoption of new and amended rules. The rules were adopted on Monday, August 30, 2004 and were filed with the Secretary of State on September 1, 2004, and are therefore effective 20 days following or Tuesday, September 21, 2004. You may view or download a copy of the final rules from our web site:
http://www.gadbf.org/docs/FinalRegsAll932004.doc
HIRING OF FELONS - THE "TOP STEP" PROGRAM It has come to the attention of the Department that there is a bonding program offered by the Federal Government known as the "Top Step Program". The purpose of the program is to encourage employers to hire persons who have previous felony convictions. If the convicted individual qualifies for this program, they can obtain a bond that would basically cover the employer against dishonest acts which might be committed by the felon while in the employment of the company. While this a federal program, it is administered through the State Department of Labor (DOL).
Please be advised that this is strictly a voluntary program for employers. In a particular instance, one of the local county DOL offices mistakenly informed a mortgage licensee that this was a mandatory hiring program, and that they had to hire someone who had qualified under the program and who had otherwise qualified for mortgage industry employment.

It was confirmed with an official with the DOL that the program is offered to encourage the employment of qualified convicted persons by various industries and businesses as a part of a rehabilitation program. It is not, and is generally not presented by the DOL as, a required hiring program.
It is very important that all licensees understand that, for purposes of the Georgia Residential Mortgage Act (GRMA), the employment of felons by licensees is prohibited in the mortgage business, unless those so convicted have received the remedies provided for in the act under O.C.G.A. 7-1-1004 et al. Therefore, unless a person had received the proper remedies, use of the Top Step Program alone without the remedies is NOT allowed under GRMA. Use of the program by the employer as an additional incentive to hire a person convicted of a felony who has received the proper remedies would be allowed.
In the event that a licensee is approached by anyone utilizing the Top Step Program, the only way that licensees can legally hire those individuals convicted of felonies in the mortgage business is for the individual to have received one of the remedies as noted. The DOL has been made aware of this legal requirement, and was asked to relay the information to their county office personnel so that the use of this program will not be routinely reported to our licensees as a requirement.
MANUFACTURED HOME DEALER GUIDELINES The Department has simplified the guidelines for determining when a manufactured home dealer must have a mortgage broker or lender license in an effort to prevent future inadvertent violations of the licensing requirements of the Georgia Residential Mortgage Act. In essence, manufactured home dealers are not required to have a license if they are only providing customers a mortgage loan application. However, if the manufactured home dealer performs duties beyond this such as (1) assisting the customer in the completion of the application, (2) mailing or delivering the application to the lender on the customer's behalf, (3) receiving compensation for loan referrals, or (4) performing any other duties that are defined as being a Mortgage Broker or Lender under 7-1-1000 (11) and (12), then a mortgage broker or lender license is required.
WEB SITES As reported last month, licensees must register their web site domain names with the Department as a d/b/a name if it is different than the name(s) licensed/registered with the Department.
A web site name is a d/b/a name and as such must be registered with the Department pursuant to the requirements of O.C.G.A Section 7-1-1006 (d) which states that "No licensee may conduct business under any name other than that designated in the license." In order to have it designated, the name must be registered. This registration is to assist the consumer in identifying licensed entities, further protect the consumer from dealing with unlicensed entities and, in addition, to also assist the Department in verifying licensed entities with those persons who, in the course of their dealings with a licensee, need to verify names with the Department.
Further, "advertisement" as defined in Department Regulation 80-11-1-.02 (f), means material used or intended to be used to induce the public to apply for a mortgage loan. Web Sites are considered advertisements, and must contain the name(s), license number, and an office address which conforms with the name, license number, and office address on record with the Department. Web sites must also contain the words "Georgia Residential Mortgage Licensee" or list Georgia as a state in the which the licensee is licensed to do business if the licensee is licensed in more than one state. The web site may not use a name for the licensee which has not been approved as a "d/b/a" name for that licensee. Please note: Since domain names do not contain spaces, it is understood that the licensee name "Your Best Mortgage" will be "yourbestmortgage.com (net, etc.) on the web. A domain name such as this does not have to be registered as a d/b/a name. However, "ybm.com", "yourbest.net", "bestmortgage.com", and similar variations on the licensed name would require registration.
DOMAIN NAME REGISTRATION Domain names, if different from the license name, must be registered as d/b/a (trade) names with the Superior Court Clerk in the Georgia county/counties where or from which business is conducted. If there is no Georgia location, d/b/a names should be registered with the appropriate authority in the licensee's home state. The recorded registration document(s) and surety bond or bond rider, if applicable, should be sent to the Department, After the appropriate documents are received and there are no conflicts with other registered d/b/a names, the web site domain name d/b/a will be added to the licensee's Department record and displayed on the Department web site. The form to be used to apply for the approval of the d/b/a name with the Department is available on the Department's web site at http://www.ganet.org/dbf/pdfdoc/DBARegis_R0804.pdf. Please use this form and submit it with the required documentation as noted in the instructions. If you have additional questions regarding domain registration, please do not hesitate to contact the Mortgage Division.

OTHER REGULATORY ISSUES
BRANCH INFORMATION Licensee and Registrant additional offices (branches) are now listed on the Department's web site. After conducting an online search at http://www.ganet.org/dbf/mortgage.html, select "Approved Branch Offices" for a list of that licensee's/registrant's approved offices. Should you find any information that needs updating, please contact the Department at (770) 986-1136.
REAL ESTATE BROKERS AND UNLAWFUL RESIDENTIAL MORTGAGE ACTIVITIES Although a real estate broker may refer consumers to a mortgage broker or mortgage lender, Georgia law prohibits a real estate broker from accepting any fee or compensation in any form whatsoever for directly or indirectly negotiating, placing, or finding a mortgage for a Georgia consumer. O.C.G.A. 7-1-1001 (4). In order for a real estate broker to receive compensation legally for such services, that real estate broker must first obtain a mortgage broker or mortgage lender license or demonstrate that he, she, or it is exempt from GRMA's licensing requirements. Compensating a real estate broker for such services will subject a Georgia licensed mortgage broker or mortgage lender to revocation procedures as such conduct constitutes engaging in residential mortgage activities with an unlicensed person. O.C.G.A. 7-1-1002.
VERIFYING LICENSED ENTITIES Rule 80-11-4-.05 of the Mortgage Division Rules states, in part, that it is the licensee's responsibility to "know" that it is conducting business with a licensed entity.
You run the risk of conducting business with an unlicensed entity if you do not verify the license. The fine for "dealing with unlicensed persons" under Rule 80-11-3-.01 (4) is $1,000 per transaction and your license shall be subject to suspension or revocation. Anyone who purchases, sells, places for processing or transfers a mortgage loan or loan application to or from a person who is required to be licensed but is not properly licensed will be fined. You can check the license status of any licensee by going to the Department's web site at http://www.ganet.org/dbf/mortgage.html. From there you can check by entering the licensee's name, license number, or city, or leave the selection box blank and you will get a complete listing of licensees. There is also an option to download the entire list into an Excel spreadsheet.
CEASE AND DESIST ORDERS - Issued
Amenity Mortgage, Inc., Atlanta, GA (license no. 15685) - Cease and Desist Order issued August 25, 2004 and became final on September 10, 2004.
Bourgeois, Jason, Canton, GA - Cease and Desist Order issued August 11, 2004 and became final on September 11, 2004.
Brooks, Delonie, Riverdale, GA - Cease and Desist Order issued August 11, 2004 and became final on September 1, 2004.
Brown, Sonya, Norcross, GA - Cease and Desist Order issued August 11, 2004 and became final on September 11, 2004.
Eastman Financial Services, Inc., Sandy, UT - Cease and Desist Order issued August 20, 2004 and became final on September 20, 2004.
Edwards, William, Lawrenceville, GA - Cease and Desist Order issued August 11, 2004 and became final on September 11, 2004.
Fowler, Terry, Decatur, GA - Cease and Desist Order issued August 11, 2004 and became final on September 1, 2004.
Frischkorn, Robert E. dba Mortgage Lenders Network, Alpharetta, GA (license no. 12926) - Cease and Desist Order issued August 24, 2004 and became final on September 10, 2004.
Global Source Capital, LLC - Cease and Desist Order issued August 11, 2004 and became final on September 11, 2004.

Graham, Randall aka Rhandell Graham, Decatur, GA - Cease and Desist Order issued August 11, 2004 and became final on September 11, 2004.
Harper-Williamson, Amanda - Cease and Desist Order issued August 19, 2004 and became final on September 19, 2004.
Hopson, Scott - Fayetteville, GA - Cease and Desist Order issued August 11, 2004 and became final on September 11, 2004.
Knight, Dretta, Riverdale, GA - Cease and Desist Order issued August 11, 2004 and became final on September 11, 2004.
Knowles-Watson, Sheila, Columbus, GA - Cease and Desist Order issued August 19, 2004 and became final on September 19, 2004.
Massey, Ron, Woodstock, GA - Cease and Desist Order issued August 11, 2004 and became final on September 1, 2004.
Oye, Abiola (Global Source Capital), Atlanta, GA - Cease and Desist Order issued August 11, 2004 and became final on September 11, 2004.
Riviera Mortgage, LLC, Atlanta, GA (license no. 12794) - Cease and Desist Order issued August 24, 2004 and became final on September 2, 2004.
Simplifi Mortgage, Inc. Roswell, GA (license no. 13929) - Cease and Desist Order issued September 3, 2004 and became final on September 16, 2004.
Skelton, Garrett, Stone Mountain, GA - Cease and Desist Order issued August 11, 2004 and became final on September 1, 2004.
TeKnowise, Salt Lake City, UT - Cease and Desist Order issued August 20, 2004 and became final on September 20, 2004.
Tristate Financial Services, Austell, GA (license no. 14293) - Cease and Desist Order issued September 3, 2004 and became final on September 16, 2004.
Wei, Kao, Atlanta, GA (license no. 18570) - Cease and Desist Order issued September 3, 2004 and became final on September 16, 2004.
White, Paulette, Stockbridge, GA -Cease and Desist Order issued August 11, 2004 and became final on September 11, 2004.
Your Mortgage Corporation, Inc., Atlanta, GA (license no. 12802) - Cease and Desist Order issued September 3, 2004 and became final on September 9, 2004.

FINE PUBLICATION
Information regarding fines assessed against a specific licensee and against whom there are no pending administrative actions, is available on an individual licensee basis by submitting a written request to the following e-mail address: dbfmort@dbf.state.ga.us

FINE REASON

2 Licensees fined for Prohibited Acts 3 Licensees fined for Advertising Violations 3 Licensees fined for Audit filed late 4 Licensees fined for Books and Records 2 Licensees fined for Background Check Violations 1 Licensee fined for an Unapproved Branch 2 Licensees fined for Loan Files not properly
maintained

58 Licensees fined for $6.50 fees not paid 1 Licensees fined for GaFLA violations 2 Licensees fined for Unapproved Branch Managers 1 Licensee fined for Relocation of office without notice 3 Licensees fined for Miscellaneous other 1 Licensee fined for failure to submit to an Exam

LICENSEES/REGISTRANTS REVOKED, EXPIRED, SUSPENDED, WITHDRAWN OR DENIED IN SEPTEMBER 2004

ID#
6695 11379 12776 12794 12926 13929 14293 15271 15685 17561 18570 19036 19437

NAME
GREAT LAKES MTG CO BNC MTG INC AURORA LOAN SVCS INC RIVIERA MTG LLC FRISCHKORN, ROBERT E SIMPLIFI MTG INC TRISTATE FINL SVCS AMERILAND MTG & CAP AMENITY MTG INC METROPOLITAN MTG & KAO, WEI PAYRITE MTG LLC SETH-ALAN MTG

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

REVOKED

EXPIRED SUSPENDED
09/02/2004 09/10/2004 09/16/2004 09/16/2004 09/10/2004 09/16/2004

WITHDRAWN
09/03/2004 09/30/2004 09/03/2004
09/10/2004 09/20/2004 09/14/2004 09/20/2004

DENIED

TOTAL: 13

LICENSEES/REGISTRANTS APPROVED OR REINSTATED IN SEPTEMBER 2004

ID# COMPANY NAME

CITY

ST MB

ORIGINAL RENEWAL REINSTATED

CODE APPROVAL

18434 PFS Mortgage Loans, Inc. +

ALPHARETTA

GA B

06/13/2003

09/03/2004

19502 Wilhar Financial Corporation

ATLANTA

GA L

09/03/2004

09/03/2004

19540 Aegis Correspondent

HOUSTON

TX L

09/03/2004

09/03/2004

19651 Charles Vincent Caggiula

VILLA RICA

GA B

09/03/2004

09/03/2004

19653 Gade Mortgage Solutions, Inc. MARIETTA

GA B

09/03/2004

09/03/2004

19656 American Financial Mortgage

CONYERS

GA B

09/03/2004

09/03/2004

19461 Security Atlantic Mortgage Co., EDISON

NJ L

09/10/2004

09/10/2004

19597 Merit Mortgage Services, Inc.

TIFTON

GA B

09/10/2004

09/10/2004

19618 Arthur Kennard McKay

WARNER ROBINS GA B

09/10/2004

09/10/2004

19619 Tina Renee McCrea

ATLANTA

GA B

09/10/2004

09/10/2004

19620 Kerry G. Washington

DECATUR

GA B

09/10/2004

09/10/2004

19625 Luther Burton

ATLANTA

GA B

09/10/2004

09/10/2004

19321 American Home Mortgage

MELVILLE

GA L

09/17/2004

09/17/2004

19402 Lending Edge Mortgage Corp. FORT MYERS

FL B

09/17/2004

09/17/2004

19418 Home Loan Master, Inc.

NORCROSS

GA B

09/17/2004

09/17/2004

19426 Empire Financial, Inc.

SNELLVILLE

GA B

09/17/2004

09/17/2004

19452 Wyatt Mortgage, Inc.

DUBLIN

GA B

09/17/2004

09/17/2004

19511 Southeastern Financial Elite

ATLANTA

GA B

09/17/2004

09/17/2004

19544 Steven Mark Gordon

WARNER ROBINS GA B

09/17/2004

09/17/2004

19549 Capital Mortgage Solutions, Inc. MARIETTA

GA B

09/17/2004

09/17/2004

19566 LFG Processing Corporation

RICHMOND

VA P

09/17/2004

09/17/2004

19573 Mortgage Loan Specialists, Inc. SOLANA BEACH CA L

09/17/2004

09/17/2004

19575 USA Mortgage Lenders, Inc.

LAUDERDALE BY FL B

09/17/2004

09/17/2004

19580 Joseph Mark Leho

KNOXVILLE

TN B

09/17/2004

09/17/2004

19611 Attorneys' Mortgage Services, ORLANDO

FL L

09/17/2004

09/17/2004

19613 United Residential Lending, LLC SCOTTSDALE

AZ L

09/17/2004

09/17/2004

19617 Discount Mortgage Today

MARIETTA

GA B

09/17/2004

09/17/2004

19621 Michael B. Johnson

MARIETTA

GA B

09/17/2004

09/17/2004

19622 Vision Mortgage Resources,

CLEVELAND

GA B

09/17/2004

09/17/2004

19623 Diversified Mortgage

DULUTH

GA B

09/17/2004

09/17/2004

19629 Innovative Property Services,

HOLLYWOOD

FL B

09/17/2004

09/17/2004

19631 Ernest S. Selph

MCRAE

GA L

09/17/2004

09/17/2004

19644 The StoneHill Group, Inc.

ATLANTA

GA B

09/17/2004

09/17/2004

19691 Maurice Calhoun

CHINO HILLS

CA B

09/17/2004

09/17/2004

19696 American Equity Loan, LLC

ATLANTA

GA B

09/17/2004

09/17/2004

19702 Metropolis Funding, Inc.

BALTIMORE

MD B

09/17/2004

09/17/2004

19703 FirstSouth Financial Services,

LITTLE ROCK

AR B

09/17/2004

09/17/2004

19704 Trinity One Mortgage, Inc.

POWDER

GA B

09/17/2004

09/17/2004

19708 Paolo Giuressi

ALPHARETTA

GA B

09/17/2004

09/17/2004

19711 Specialty Mortgage, Inc.

DULUTH

GA B

09/17/2004

09/17/2004

19712 Thomas Edward Devereese

CALHOUN

GA B

09/17/2004

09/17/2004

19713 Manuel Eugenio Martinez

DULUTH

GA B

09/17/2004

09/17/2004

19714 Blue Skies Mortgage Group,

DULUTH

GA B

09/17/2004

09/17/2004

19715 WR Starkey Mortgage, LLP

PLANO

TX L

09/17/2004

09/17/2004

19717 Tatrabian D. Charles

FORSYTH

GA B

09/17/2004

09/17/2004

19718 Jamel Jerome Houseworth

STONE

GA B

09/17/2004

09/17/2004

19719 Mortgage Solutions Of Georgia, WOODSTOCK

GA B

09/17/2004

09/17/2004

19722 Georgia First Mortgage Group, CUMMING

GA B

09/17/2004

09/17/2004

19740 Landmac Mortgage Corporation TUCKER

GA B

09/17/2004

09/17/2004

LICENSEES/REGISTRANTS APPROVED OR REINSTATED IN SEPTEMBER 2004

ID# COMPANY NAME

CITY

17076 19438 19732 19738 19748 19768
6563 16933 19102 14798

Stockton Turner, LLC * Ocwen Loan Servicing, LLC Allstar Home Mortgage, LLC Southern Home Mortgage Flagship Financial, LLC Tara Professional Lending, Inc. Don T. Golden VM Mortgage, Inc. Praise Mortgages, Inc. Your Money Center

MAITLAND WEST PALM SMYRNA TUCKER PROVO MARTINEZ SAVANNAH ELLENWOOD JONESBORO HARTWELL

ST MB

ORIGINAL RENEWAL REINSTATED

CODE APPROVAL

FL L

03/01/2002

09/24/2004

FL L

05/21/2004

09/24/2004

GA B

09/24/2004

09/24/2004

GA B

09/24/2004

09/24/2004

UT B

09/24/2004

09/24/2004

GA B

09/24/2004

09/24/2004

GA B

12/03/1993

09/03/2004

09/03/2004

GA B

11/30/2001

09/03/2004

09/03/2004

GA B

01/16/2004

09/10/2004

09/10/2004

GA B

06/18/1999

09/17/2004

09/17/2004

TOTAL: 59

B = BROKER L = LENDER R = REGISTRANT

* Upgrade Broker to Lender + Downgrade Lender to Broker # Upgrade Lender to Registrant Downgrade Registrant to Lender