Monthly summary of mortgage activities, Nov. 2006

Georgia Department of Banking & Finance

NON-DEPOSITORY FINANCIAL
INSTITUTIONS

Monthly Summary of Mortgage Activities For the Period Ending November 2006

Inside this issue:

FinCEN ReportMortgage Fraud Rises

1

Non-Traditional Mortgage Loan Guidance

2

Conforming Loan Limits--2007

2

OTHER ITEMS & ISSUES

Net Branches

3/4

Continuing Education

Holiday Closings

2007 State Holidays

Customer Service Georgia

5

Administrative Actions

6

Fine Publication

7

Licenses Revoked, Expired...Denied

8

Licenses Approved & Reinstated

8

2990 Brandywine Rd. Suite 200
Atlanta, GA 30341 Phone: 770.986.1269
Fax: 770.986.1029

NEWS ITEMS

Mortgage Fraud Rises
FinCEN Reports Rise in Mortgage Fraud
SARS
Suspected mortgage fraud increased by 35 percent between the first quarter of 2005 and the first quarter of 2006, according to statistics released by the Financial Crimes Enforcement Network on Nov. 3. FinCEN's report was based on an analysis of Suspicious Activity Reports that indicated suspected mortgage loan fraud between April 1, 1996, and March 31, 2006. The leading

types of mortgage fraud described on the reports were "false statements" and "identity theft." Some of the false statements included altered bank statements, fraudulent earnings documents, fraudulent letters of credit, fabricated letters of gifts, misrepresentations of employment and altered credit scores.
Reports of mortgage loan fraud rose significantly in 2003. The Federal Financial Institutions Examination Council reported an increase in the number of mortgage loans beginning in 2003: "The 2003 data include a total of 42 million reported loans and applications, which is an increase of about 33 percent from 2002, primarily due to a

significant increase in refinancing activity (approximately 41 percent)." SARs on mortgage loan fraud increased over 92 percent between 2003 and 2004. The increase in filings may be attributed to an increase in overall mortgage lending concurrent with the decline in interest rates in the 2002 2005 timeframe and a broader awareness of this fraudulent activity. Figure 1 depicts the filing trend between 1997 and 2005.
During 2005, the top five states for mortgage fraud were California, Florida, Illinois, Texas and Georgia. Other states with high report numbers were Washington, North Carolina, Ohio, Michigan and New York. National banks were the largest group of lenders reporting mortgage fraud.

Read more:

www.fincen.gov/ MortgageLoanFraud.pdf

Continued on Page 2

Monthly Summary of Mortgage Activities For the Period Ending November 2006

Page 2

Non-Traditional Mortgage Product
Guidance

Georgia Department of Banking and Finance Adopts
Regulatory Guidance on Nontraditional Mortgage
Products

Rob Braswell, Georgia

Department of Banking and

Finance

Commissioner,

announced on November 14,

2006 a set of regulatory

guidelines covering the

marketing of nontraditional

mortgages by state-licensed

entities.

The guidance was developed

by the Conference of State

Bank Supervisors (CSBS) and

the American Association of

Residential

Mortgage

Regulators (AARMR) and

applies to state-licensed

mortgage brokers and lenders.

The guidance is intended to

promote consistent regulation

in the mortgage market and to

clarify how residential

mortgage providers can offer

nontraditional

mortgage

products in a way that clearly

discloses the risks borrowers

may assume.

Commissioner Braswell stated, "These guidelines are designed to level the playing field in the mortgage market in order to protect consumers from taking on high-risk mortgages without having a full understanding of the terms of such loans."

The CSBS/AARMR guidance parallels final guidance

released on September 29, 2006 by the Office of the Comptroller of the Currency, the Board of Governors of the Federal Reserve System, the Federal Deposit Insurance Corporation, the Office of Thrift Supervision, and the National Credit Union Administration.

That interagency guidance,

however, applies only to

insured financial institutions

and their affiliates. To

promote consistency, the

CSBS/AARMR

guidance

substantially mirrors the

interagency guidance, except

for the deletion of sections

inapplicable to non-

depository institutions.

Commissioner

Braswell

commented that the goal

desired by CSBS and AARMR

is to have all states to adopt

the guidelines so that all

consumers will be equally

protected and all originators

of residential mortgages will

be subject to similar

supervisory guidance.

This guidance should be used

as a best practices document

when utilizing nontraditional

mortgage products. For your

convenience, the guidance is

available

from

the

Department's website at:

http://www.gadbf.org/ bulletins.html#PR

Conforming Loan Limits for 2007
2007 Conforming Loan Limit to Remain at $417,000
Washington, DC Office of Federal Housing Enterprise Oversight Director James B. Lockhart announced November 28, 2006, that the maximum 2007 conforming loan limit for single-family mortgages purchased by Fannie Mae and Freddie Mac (the Enterprises) will remain at the 2006 level of $417,000 for one-unit properties for most of the U.S.
The conforming loan limit determines the maximum size of a mortgage that an Enterprise can buy or guarantee. By law the maximum conforming loan limit is based on the October-to-October change in the average house price in the Monthly Interest Rate Survey (MIRS) of the Federal Housing Finance Board (FHFB). The FHFB reported the decline in the average price was $501, or 0.16 percent, from $306,759 in October 2005 to $306,258 in October 2006. This is the first decline in the MIRS since 1992-93.
OFHEO announced November 15 it would keep the limit at 2006 levels if
(Continued on page 3)

UPCOMING SPEAKING ENGAGEMENTS There are no
speaking engagements scheduled for December.
Useful Links
MORTGAGE FORMS: CODE, REGULATIONS & APPLICATIONS
HTTP://WWW.STATE.GA.US/ MORTGAGE_FORMS.HTML UPDATING LICENSE INFORMATION
HTTP://WWW.STATE.GA.US/ DBF/MORTGAGE_FORMS.HTM
L#ONLINE PRESS RELEASES HTTP://WWW.GANET.ORG/D BF/BULLETINS.HTML

Continued on Page 3

Monthly Summary of Mortgage Activities For the Period Ending November 2006

Page 3

OTHER ITEMS & ISSUES
Net Branches
(This one just stays with us...)
As we have noted several times, the Department does not allow entities licensed under the Georgia Residential Mortgage Act to operate net branches in Georgia. However, the Department recognizes that many licensees operate in multiple states and that some of those other states do allow net branching.
The latest nuance involves a GRMA licensee whose net branch personnel contacted the Department to see if they could get a 1 time loan approval. Obviously, because that branch located in another state is being operated independently, it is unaware of the operating procedures in place and licenses held by the company.
A properly supervised branch would send those loans to the main office, or if the company has a policy to allow the use of alternate lenders, the branch should not be handling those requests independently of company management.

BROKERS Continuing Education
Please remember that the requirement for CE hours will begin with the FY 2008 licensing period (April 1, 2007 renewal). Licensees have had from January 1, 2006 through April 1, 2007 to obtain CE credits for this initial CE period. Beginning with the FY 2009 license renewal and going forward, April 1 through March 31 will be the period each year to obtain CE hours.
Licensees who fail to obtain credit by the April 1 deadline of any year have until June 30, 2007 to make up the credits, but will receive a $1,000 fine for failure to obtain credit in the qualifying 12 months for that renewal period. If the CE hours are then not obtained in the make-up period, the renewal will not be approved.
Note that there was a regulation change in 2006 which states that any person licensed in any year after April 1 must have the required 12 hours of CE credit in order to renew their license. So, if a person is licensed after April 1 but prior to December 31 in any given year, they must obtain CE hours in order to renew in the next year, and in order to avoid a fine must obtain those credits prior to March 31 of the renewal year.
Holiday

Please see 80-11-1-.03 paragraphs

Closings

(4) and (5) for branch require-

ments for the State of Georgia.

Department offices will be closed on the

following days:

Monday and Tuesday, December 25 &

26, 2006 for Christmas.

Monday, January 1, 2007 in observance of the New Year's holiday

Conforming Loans (Continued from page 2)
there was a decrease in Octoberto-October house prices and would defer that decline for one year.

"This amount is in keeping with OFHEO's recent announcement of an orderly and transparent process for any downward adjustment," said Lockhart. "We made this decision so as not to disrupt the end-of-the-year pipeline of mortgages or the market for mortgage-backed securities," said
Lockhart.

OFHEO also stated previously that additional guidance for the 2008 limits would be issued early next year.

Conforming Loan Limit/ % Increase

2007 $417,000

0

2006 $417,000

15.9%

2005 $359,650

7.8%

Prior to this year's decrease, the average increase in the FHFB survey over the previous five years was 8.8 percent.

OFHEO assumed responsibility for establishing the conforming loan limit with a February 2004 guidance.

The conforming loan limit is based on the FHFB monthly survey and not OFHEO's quarterly House Price Index (HPI), which will be released
November 30.

As published on FannieMae's website, note the conforming loan limits in the table on Page 4:

Continued on Page 4

Monthly Summary of Mortgage Activities For the Period Ending November 2006

Page 4

2007 CONFORMING LOAN RATES
2007 Single-Family Mortgage Loan Limits
Effective January 1, 2007:

First mortgages
One-family loans: $417,000 Two-family loans: $533,850 Three-family loans: $645,300 Four-family loans: $801,950
Note: One- to four- family mortgages in Alaska, Hawaii, Guam, and the U.S. Virgin Islands are 50 percent higher than the limits for the rest of the country.
Second mortgages
$208,500 In Alaska, Hawaii, Guam, and the U.S. Virgin Islands: $312,750
Last Revised: December 01, 2006--http://www.fanniemae.com/aboutfm/loanlimits.jhtml

2007 State Holidays
The following is a list of State Holidays when the Capitol and all State agencies will be closed in 2007.

HOLIDAY New Year's Day Martin Luther King Jr.'s Birthday Confederate Memorial Day Memorial Day Independence Day Labor Day Columbus Day Veterans' Day
Thanksgiving Day Robert E. Lee's Birthday Christmas Day Washington's Birthday

DATE / OBSERVANCE DATE Monday, January 1 Monday, January 15
Monday, April 23 Monday, May 28 Wednesday, July 4 Monday, September 3 Monday, October 8 November 11 will be observed on Monday, November 12 Thursday, November 22 January 19 ~ will be observed on Friday, November 23 Tuesday, December 25 February 19 ~ will be observed on Monday, December 24

Happy Holidays
& Best Wishes For The New
Year
Continued on Page 5

Customer Service Georgia

Page 5

Governor Sonny Perdue has a campaign to put new emphasis on customer service, emphasizing easier access to government services, faster processes so customers can get business done quickly, and friendlier service in a customer-focused, goal-oriented culture. It is the Department's goal to provide excellent customer service, meeting and exceeding the expectations of our customers. Along those lines, we would like to recognize the following individuals for going above and beyond in serving our customers:
Bob Bauguss, Assistant Financial Examiner-Mortgage (Non-Depository Financial Institutions Division): Bob received a letter from a customer stating: "I wanted to take a moment to thank you for all of your help in the last few days with questions that I have had. You have been a vital source of information for us, and also so kind and encouraging. Again, I want to express my sincere appreciation for all of the help that you have given us. I genuinely hope that the Department of Banking and Finance realizes what a strong asset they have in you."

CONGRATULATIONS AND GREAT JOB!!

The Department is the state agency that regulates and examines banks, credit unions, and trust companies chartered by the State. The Department also has regulatory and/or licensing authority over mortgage brokers, lenders, and processors, money service businesses, international banking organizations, and bank holding companies conducting business in Georgia.
Our MISSION is to promote safe, sound, competitive financial services in Georgia through innovative, responsive regulation and supervision.
Our VISION is to be the best financial services industry regulator in the country Progressive. Proactive. Service-Oriented.
Continued on Page 6

Administrative Actions

For the Period Ending November 2006

CEASE AND DESIST ORDERS--ISSUED

Page 6

First Community Lending, Inc., Acworth, GA (license no. 12060) Cease and Desist Order issued October 17, 2006 became final on November 16, 2006.
Corey Mortgage Services, Inc., Atlanta, GA (license no. 6305) Cease and Desist Order issued September 29, 2006 became final November 1, 2006.
Davis, Pamela dba Wonderful Mortgage Consultant & Insurance, Jonesboro, GA Cease and Desist Order issued October 13, 2006 became final November 13, 2006.
Debt Management Consultants (DMC, LLC), Duluth, GA Cease and Desist Order issued October 27, 2006 became final November 27, 2006.
Johnson, Karen, College Park, GA Cease and Desist Order issued May 12, 2005 became final November 30, 2006.
Fairon & Associates, Inc. dba LoanNow Financial, Irvine, CA (license no. 19495) Cease and Desist Order issued October 3, 2006 became final November 5, 2006.
Mahan, Marie, Conyers, GA Cease and Desist issued Order October 10, 2006 became final November 10, 2006.
Norris, Clifford Lloyd, Lawrenceville, GA Cease and Desist Order October 10, 2006 became final November 10, 2006.
Torres, Jose, Duluth, GA Cease and Desist Order July 21, 2005 became final on November 7, 2006.
Worldwide Financial Group, Inc., Jonesboro, GA (license no. 12323) Cease and Desist Order issued October 25, 2006 became final November 15, 2006.

Continued on Page 7

Administrative Actions

For the Period Ending November 2006

Page 7

CEASE AND DESIST ORDERS--LIFTED OR RESCINDED



None

FINAL CONSENT ORDERS --ISSUED



None

SUPERIOR COURT INJUNCTIONS



None

FINE PUBLICATION

FINE REASON

1 Licensees fined for Advertising Violations 3 Licensees fined for Background Checks Violation 2 Licensees fined for Books & Records 1 Licensee fined for Employment of a Felon 4 Licensee fined for Loan Files not properly maintained 2 Licensee fined for Check returned for Insufficient Funds

1 Licensees fined for doing business w/ unlicensed entity
1 Licensees fined for Unapproved Branch Manager 3 Licensees fined for Prohibited Acts 2 Licensees for Unapproved Change in Management 2 Licensee fined for Miscellaneous/Other

Continued on Page 8

Monthly Summary of Mortgage Activities For the Period Ending November 2006

Page 8

LICENSEES/REGISTRANTS REVOKED, EXPIRED, SURRENDERED, WITHDRAWN OR DENIED

IN NOVEMBER 2006

ID#

NAME

CODE

REVOKED

EXPIRED

SURRENDERED

WITHDRAWN

DENIED

6305 COREY MTG SVCS INC

BD

7037 MTG MATTERS INC

BD

12060 1ST CMTY LENDING INC

BD

12974 PEACH PLUS FINL INC

BD

16661 JLM DIRECT FUNDING LTD

LD

19448 DEEPGREEN FINL INC

LD

19495 FAIRON & ASSOC INC

LD

21219 OASIS GRP LLC

BD

21633 EPIX FUNDING GROUP,

INC.

LD

21840 GA HOME FINANCIAL

CORP.

BD

TOTAL: 10

11-01-2006 11-16-2006
11-05-2006

11-01-2006
11-21-2006 11-07-2006 11-21-2006
11-03-2006

11-16-2006 11-17-2006

ID# 20163
21893 21909 21910 21921 21922
21940 21959 21969

LICENSEES/REGISTRANTS APPROVED OR REINSTATED IN NOVEMBER 2006

MB

ORIGINAL

COMPANY NAME Southern Horizon Financial Group, LLC * Innovative Mortgages, Inc.

CITY Kennesaw
Vienna

ST CODE

GA

L

VA

L

APPROVAL 04-01-2005
11-03-2006

RENEWAL REINSTATED 11-03-2006
11-03-2006

Rate One, Inc. The Mortgage People Memphis

TN

L

11-03-2006 11-03-2006

Taneise S. Deal

Alpharetta

GA

P

11-03-2006 11-03-2006

MBA Financial Associates, Inc.

Miramar

FL

B

11-03-2006 11-03-2006

Georgia Mortgage & Funding Group, LLC Lexington Capital Corporation

Tyrone Santa Ana

GA

B

CA

L

11-03-2006 11-03-2006

11-03-2006 11-03-2006

Premier Choice Mortgage, LLC Abaca Mortgage, Inc.

College Park Navarre

GA

B

FL

B

11-03-2006 11-03-2006

11-03-2006 11-03-2006

21971 21976 21984 21985 14335 21847
21926

Southern Mutual Mortgage, LLC Life City Financial Group, LLC Signature Mortgage Group, Inc. Citywide Mortgage Corporation Solstice Capital Group, Inc. # First Access Mortgage Corp.
Quid Quo Mortgage, Inc.

Duluth Doraville Marietta Norcross Irvine Hammond
Jupiter

GA

B

GA

B

GA

B

GA

B

CA

R

LA

B

FL

B

11-03-2006 11-03-2006 11-03-2006 11-03-2006 04-02-1999 11-10-2006
11-10-2006

11-03-2006 11-03-2006 11-03-2006 11-03-2006 11-10-2006 11-10-2006
11-10-2006

21949 Fidelity One Finance, LLC 21952 Infinite Possibilities Worldwide, LLC

Miami Lithonia

FL

B

GA

B

11-10-2006 11-10-2006

11-10-2006 11-10-2006

21953 United Home Mortgage (Inc.)

Minneapolis

MN

B

11-10-2006 11-10-2006

Continued on Page 9

Monthly Summary of Mortgage Activities For the Period Ending November 2006

Page 9

ID# 21960 21966

LICENSEES/REGISTRANTS APPROVED OR REINSTATED IN NOVEMBER 2006

COMPANY NAME

CITY

MB ST CODE

ORIGINAL APPROVAL

RENEWAL REINSTATED

Source 1 Lending, LLC

Atlanta

GA

B

11-10-2006 11-10-2006

GNM Enterprises, Inc. (MI)

Madison

MI

B

11-10-2006 11-10-2006

21983 Home-Key Capital, Inc.

Auburn

GA

B

21992 Gates Lending, LLC

Atlanta

GA

B

20422 SunnyMTG.com 866-768-CASH,

Fort Lauderdale FL

L

LLC *

21956 Julie Bordelon

Kennesaw

GA

B

21963 Taylor Mortgage Broker Consulting, Inc.
21977 Champion Financial Group, LLC

Alpharetta Savannah

GA

B

GA

B

21979 J & S Capital Group, Inc.

Duluth

GA

B

21980 NuVision Mortgage Services, LLC Suwanee

GA

B

21988 Home Servicing, LLC (Louisiana)

Baton Rouge

LA

L

21989 Trinity Freedom Mortgage, Inc.

Lilburn

GA

B

21993 Atlanta Mortgage Lending, LLC

Suwanee

GA

B

22005 Ameriquest Asset Management,

Orange

CA

L

LLC

22008 Reliance Mortgage Brokerage, Inc. Fort Lauderdale FL

B

22009 Global Mortgage Lenders, LLC

Atlanta

GA

B

21885 Discount Mortgage Warehouse,

Sunny Isles

FL

L

Inc.

Beach

21903 Crown Mortgage Group & Associ- Deerfield Beach FL

B

ates, LLC

21978 Regent Mortgage Funding, LLC

Naples

FL

L

21999 Brand Mortgage Group, LLC

Lawrenceville

GA

L

16942 American Lending Corporation

Owings Mills

MD

L

17491 AGA Investors, LLC

Albany

GA

B

20013 Pacific West Lending, Inc.

Carlsbad

CA

L

20754 Branch Mortgage Consultants, Inc. East Setauket

NY

B

15922 Peachtree City Mortgage House,

Peachtree City GA

B

LLC

11-10-2006 11-10-2006 08-05-2005
11-17-2006 11-17-2006
11-17-2006 11-17-2006 11-17-2006 11-17-2006 11-17-2006 11-17-2006 11-17-2006
11-17-2006 11-17-2006 11-24-2006
11-24-2006
11-24-2006 11-24-2006 11-30-2001 08-30-2002 01-21-2005 11-18-2005 07-21-2000

11-10-2006 11-10-2006 11-17-2006
11-17-2006 11-17-2006
11-17-2006 11-17-2006 11-17-2006 11-17-2006 11-17-2006 11-17-2006 11-17-2006
11-17-2006 11-17-2006 11-24-2006
11-24-2006
11-24-2006 11-24-2006 11-03-2006 11-03-2006 11-10-2006 11-17-2006 11-24-2006

11-03-2006 11-03-2006 11-10-2006 11-17-2006 11-24-2006

TOTAL: 44

*

Upgrade Broker to Lender

+

Downgrade Lender to Broker

#

Upgrade Lender to Registrant



Downgrade Registrant to Lender

MB CODES B = BROKER L = LENDER R = REGISTRANT

Continued on Page 10

Monthly Summary of Mortgage Activities For the Period Ending November 2006

Page 10

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