Monthly summary of mortgage activities, Jan. 2007

Georgia Department of Banking & Finance

NON-DEPOSITORY FINANCIAL
INSTITUTIONS

Monthly Summary of Mortgage Activities For the Period Ending January 2007

INSIDE THIS ISSUE

2007 Housekeeping Bill 1

Advertising & Marketing

1

EXAMINATION ISSUES

Fraud Programs

2

LICENSING & ADMINISTRATION

Continuing Education Programs

2

FY 2008 Renewals/HMDA

3

Administrative Actions & Fine Data

4/5

Licenses Revoked,

Expired...Denied

6

Licenses Approved & Reinstated

7

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

NEWS ITEMS

2007 Housekeeping Bill
The Department's Housekeeping Bill for this legislative session is Senate Bill 70. In addition to some basic housekeeping changes, some of the significant items related to the Georgia Residential Mortgage Act, Article 13 of Chapter 1 of Title 7 of the Official Code of Georgia, Code Sections 7-1-1000 to 7-1-1021, are noted below for your reference. A complete markedup version of the housekeeping bill can be found on the internet at:
http://www.legis.ga.gov/ legis/2007_08/fulltext/sb70.htm
Proposed Amendments Article 13
Licensing of Mortgage Lenders and Mortgage
Brokers
7-1-1001
The proposed change removes the availability of a licensing exemption for a person, other than a natural person, to make five or fewer loans per year.
7-1-1004
This amendment requires licensees and applicants to commence performing background checks within ten days of the initial hire of an

employee. In addition the timeframe in which the Department may not issue a license or may revoke a license from an applicant or licensee that employs any person against whom a final cease and desist order has been issued has been extended from three to five years.

education approval on any ground on which it might refuse to issue an approval. The amendment includes a provision that any notice or final order sent by certified mail that is returned to the Department as "refused" or "unclaimed" will be deemed to have been received by the addressee.

7-1-1006 This amendment eliminates branch application approval by operation of law if an application is not acted upon by the Department within 30 days.
7-1-1008

7-1-1018
This amendment includes a provision that any notice or final order sent by certified mail which is returned to the Department as "refused" or "unclaimed" is deemed to have been received by the addressee.

This amendment requires that a person who directly or indirectly acquires 10% or more of the ownership of a licensed entity must follow certain approval steps. The prior provision set the ownership threshold at 25%.

Advertising & Marketing

7-1-1009 This amendment clarifies that a licensee should maintain separate personal and business records.
7-1-1016 This amendment provides language prohibiting the use of loan information pertaining to a designated individual in advertisements without required disclosures being made.
7-1-1017 Language has been added to allow the Department to suspend or revoke a mortgage broker

The Department continues to receive complaints regarding solicitations from licensees to consumers that use a consumer's existing loan information to entice the consumer to refinance with it, "the un-named company" that has sent the solicitation, and get out of their existing loan with the licensee named in the solicitation, the current mortgagee. These solicitations generally result in fine assessments against licensees for various violations of GRMA.
Much of the problem seems to stem with the marketing company itself, which touts this "covert" advertising style as a good way to get a concerned consumer to call,
(Continued on page 2)

Continued on Page 2

Monthly Summary of Mortgage Activities For the Period Ending January 2007

Page 2

Advertising (Continued from page 1)
after thinking there is a problem with his or her existing mortgage.
However, the remainder of the problem stems from licensees themselves, who apparently forget the provisions of 7-1-1016 which, in addition to prohibiting false and misleading advertising, also prohibits advertising that does not include, among other items, a valid address of the licensee, the license number, and the indication that the company is a Georgia Residential Mortgage Licensee.
Should the proposed provisions of the 2007 Housekeeping Bill be approved, the detailed requirements regarding advertisements will require more due diligence on the part of the offending licensees to disclose their part in these solicitations, perhaps alleviating the consumer concerns that come from them.
EXAMINATION ISSUES
Does Your Fraud Prevention Program
Measure Up?
In recent months, the State of Georgia has relinquished its #1 position for the #3 position on the list of states in which mortgage fraud is the most prevalent. While the Department is happy to give up the #1 position, mortgage fraud detection and prevention continues to be our priority. For the Department, what constitutes mortgage fraud can be found under O.C.G.A 7-1-1013 (1)(2) and (6). These sections state, in part, that it is prohibited to misrepresent the material facts; conceal or cause another party to conceal material facts; or to engage in any transaction, practice or course of business which is not in good faith, or which operates a fraud upon any person. Such misrepresentations are those used in the loan process which may influence a mortgage lender to approve an application which would have otherwise been declined. The

examiners often find misrepresentations of occupancy, misrepresentations of employment or income, or failure to disclose previous loans. The Department's recourse is imposition of fines and possible administrative action, and might also include referrals to local or state law enforcement authorities.
As a mortgage licensee in the State of Georgia, it is your responsibility to develop and implement a mortgage fraud detection program that reduces the incidence of mortgage fraud. Fraud prevention begins with the implementation of a sound quality control program that is able to detect fraud at several different stages of the loan process. This process should include, but is not limited to: frequent auditing of in-process loan files; conducting review appraisals; using only approved closing attorneys; verifying income and asset information; and preventing any one employee from controlling the mortgage transaction from beginning to end, thereby establishing the separation of duties between loan officers, processors and other staff.
The Department's Mortgage Examiners will want to review your fraud prevention policies and procedures during an examination. Should you have any questions about your internal quality control procedures or if you would like to report any fraudulent activities, please contact the Department at 770-986-1136 and ask to speak to a mortgage examiner.
LICENSING ISSUES
Continuing Education Programs
Please see the December, 2006 Mortgage Monthly Summary for all of the specific requirements regarding the Continuing Education requirements for license renewals. That publication can be found on the web at http://www.ganet.org/ dbf/bulletins.html.

The purpose of this article is to answer some of the questions regarding continuing education that many licensees been asking, particularly regarding the approved providers and the acceptable methods by which the credit hours can be delivered and earned.

The regulation

concerning

continuing education addresses

these issues.

80-11-4-.01 Initial Experience and Education Requirements; Continuing Education.

Paragraph (7)(c) states: Seminars, courses or classes sponsored and approved by mortgage-related state and federal regulatory agencies, the National Association of Mortgage Brokers (NAMB), state and federal regulated lenders and their affiliates or professional associations, all of which must be recognized by the Department as proper providers of education requirements ("approved providers"). Requirements may be satisfied at monthly association meetings, conventions, seminars or through electronic means provided the subject meets the requirements of this Rule. For purposes of continuing education, instructors and speakers at seminars, conventions or classes sponsored by approved providers will not be required to seek Department approval as approved providers of mortgage education classes. Education providers shall assign a certificate number to each attendee of a seminar, course or class. In state providers must keep lists of attendees for at least two (2)
years .

Note the providers listed above which you can use, and the delivery method, which includes classroom, internet, and computer based delivery. The following should be noted by both providers and attendees regarding the Department's policy on electronic

UPCOMING SPEAKING ENGAGEMENTS
NDFI Deputy Commissioner Rod Carnes. Supervisory Examiner Diane Hester, and Mortgage Examiner Betty Thomas will be giving a presentation to the Georgia Association of Mortgage Brokers at noon on February 15, 2007 at the Cobb Galleria.
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)

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Monthly Summary of Mortgage Activities For the Period Ending January 2007

Page 3

Continuing Education--(Continued from page 2)
training delivery:
Approved in-state education providers must maintain specific records for at least two years. Licensees must maintain these records for five years, in a form that the Department authorizes. For all computer-based courses, in addition to the materials required by the Regulation, a school should also maintain the following information for each computer-based course:
1. The student's name, the course title, the number of hours taken to complete the course, the particular software version of the course, and the course serial number (if available);
2. A system to verify the completion of each module of instruction within the computer-based course and the date of completion of the course;

PASSWORDS: Are provided in your renewal notice. Contact the Department if you misplace this information.
INCOMPLETE or "INFORMATION REQUIRED" APPLICATIONS: Should any additional information be required for any renewal, the licensee will be contacted by e-mail or fax ONLY. Renewals requiring additional information cannot be approved until such information is received and approved. All fines and fees must be paid.

http://www.ffiec.gov/hmda/guide.htm
Reports of calendar year 2006 HMDA data are due March 1, 2007. Any questions or requests for information should be directed to:
Assistance Line: (202) 452-2016
Internet E-Mail Address: hmdahelp@frb.gov

LATE FILINGS: If you have attempted access but been unable to utilize the on-line system, please contact the Department for instructions to complete your application. HARD COPY FORMS ARE NOT AVAILABLE ON THE INTERNET. Failure to request assistance in a timely manner will NOT prevent the assessment of the late fee if the deadline has passed.

3. The scores for each student for all final examinations for those courses requiring such examinations; and
4. Verification of the above data by the school director/coordinator provided to the licensee for the licensee's recordkeeping purposes.

BROKERS ONLY - CONTINUING EDUCATION REQUIREMENT The continuing education reporting requirement is effective with this renewal.
HMDA Reporting

FY 2008 Renewals
The FY2008 on-line license renewal application system will be available beginning mid-February, 2007. ALL licensees MUST complete their application ON-LINE.
Licensees should use their USER ID and PASSWORD which will be mailed with the renewal notice in February. Please note the following:
PAYMENT: May be made by ACH or credit card ONLY.

Banks, savings and loan associations, credit unions, and mortgage and consumer finance companies are required to report HMDA data if they meet the law's criteria for coverage.
Generally, whether a lender is covered by HMDA depends on:
The lender's asset size (for example, an institution with assets of $34 million or less on December 31, 2004, did not have to collect HMDA data in 2005);
Whether the lender has an office in a metropolitan statistical area; and
The extent of the lender's housing-related lending activity.
In 2005, 8,853 lenders reported 2004 HMDA data.
"A Guide to HMDA Reporting: Getting It Right!" which provides guidance on collection and reporting of HMDA data is available at:

Continued on Page 4

Administrative Actions

For the Period Ending January 2007

CEASE AND DESIST ORDERS--ISSUED

Page 4

Classic Home Lending, Inc, Houston, TX (license no. 20780) Cease and Desist Order issued December 19, 2006 became final on January 18, 2007.
Crutchfield, Deitra, Riverdale, GA Cease and Desist Order issued December 21, 2006 became final on January 11, 2007.
Harrison, E. A. Tony dba Harrison & Associates Cease and Desist Order issued December 1, 2006 became final on January 1, 2007.
Losch, Debra, Tierra Verde, FL Cease and Desist Order issued December 21, 2006 became final on January 11, 2007.
Losch, Scott, Tierra Verde, FL Cease and Desist Order issued December 21, 2006 became final on January 11, 2007.
MBM Capital, Kennesaw, GA (license no. 12480) Cease and Desist Order issued December 7, 2006 became final on January 8, 2007.
Murray, Mary E., Richmond Hill, GA Cease and Desist Order issued December 21, 2006 became final January 21, 2007.
Roberson, Victor, Smyrna, GA -- Cease and Desist Order issued January 3, 2007, became final January 24, 2007.
Sebring Capital Partners, Limited Partnership, Carrollton, TX (license no. 12838) Cease and Desist Order issued December 19, 2006 became final on January 18, 2007.
Turner, Shannon, Stone Mountain, GA Cease and Desist Order issued December 21, 2006 became final January 22, 2007.
Tuttle, Charles, Covington, GA Cease and Desist Order issued December 21, 2006 became final on January 21, 2007.
Walter Mortgage Servicing, Inc., Tampa, FL Cease and Desist Order issued December 21, 2006 became final on January 21, 2007.
Washington, Charles L., Cumming, GA Cease and Desist Order issued November 21, 2006 became final on January 16, 2007.
Watson, Kelvin (aka "Kevin" and "Calvin" Watson), Jonesboro, GA Cease and Desist Order issued December 21, 2006 became final on January 11, 2007.

Continued on Page 5

Administrative Actions

For the Period Ending January 2007

Page 5

CEASE AND DESIST ORDERS--LIFTED OR RESCINDED
Argent Mortgage Company, LLC, Irvine, CA (license no. 17408) Cease and Desist Order by Consent issued August 16, 2006 was rescinded on January 10, 2007.
Nll Capital, LLC, Wauwatosa, WI (license no. 19197) Cease and Desist Order issued November 11, 2006 was rescinded on January 5, 2007.
FINAL CONSENT ORDERS --ISSUED



None

SUPERIOR COURT INJUNCTIONS



None

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

9 Licensees fined for Advertising Violations 4 Licensees fined for Background Checks Violation 4 Licensees fined for Books & Records 1 Licensee fined for Employment of a Felon 2 Licensees fined for Violation of Cease & Desist Order 1 Licensee fined for Failure to Submit to Exam 1 Licensee fined for $6.50 fees not paid 1 Licensee fined for Relocation of office w/o notice

1 Licensee fined for Unapproved Branch 3 Licensees fined for Unapproved Branch Manager 1 Licensee fined forGaFLA Violation 6 Licensees fined Loan Files not properly maintained 6 Licensees fined for Prohibited Acts 2 Licensees fined for Miscellaneous/Other 2 Licensees fined for doing business w/ unlicensed
Entity

Continued on Page 6

Monthly Summary of Mortgage Activities For the Period Ending January 2007

Page 6

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

ID#

NAME

IN JANUARY 2007

CODE

REVOKED

EXPIRED

SURRENDERED

WITHDRAWN DENIED

6366 ECONOMY MTG INC

BD

01-12-2007

6714 AAA MTG & FIN INC

BD

01-25-2007

6837 DELTA MTG CO

BD

01-04-2007

12480 MBM CAP

BD

01-08-2007

12638 TOWN & COUNTRY CREDIT

LD

01-02-2007

12838 SEBRING CAP PARTNERS LP

LD

01-18-2007

17798 HALLEN MTG CORP

BD

18685 AARDVARK FINL INC

PD

19249 TOTAL MTG SOLUTIONS LLC

BD

19459 LENDING ATL INC

BD

20356 HARBOURTON MTG INV CORP

LD

20570 JP MTG LLC

BD

20780 CLASSIC HM LENDING INC

LD

21059 MATRIX FINL LLC

BD

21080 EXECUTIVE CAP MTG LLC

BD

01-18-2007

01-25-2007 01-12-2007 01-12-2007 01-25-2007 01-12-2007 01-12-2007
01-12-2007 01-02-2007

TOTAL: 15

Continued on Page 7

Monthly Summary of Mortgage Activities For the Period Ending January 2007

Page 7

ID# 22101 22102 22104
20392 22018 22108
22110 22112
22118 22132
21986 22017 22070 22099 22119 22136 22144 22154 22157 22183
22185
22190 22046 22068 22071 22107 22135 22138
22140
22170

LICENSEES/REGISTRANTS APPROVED OR REINSTATED IN JANUARY 2007

COMPANY NAME Financial Help Services, Inc.

CITY Lake Wylie

MB

ST CODE

SC

L

ORIGINAL
APPROVAL 01-05-2007

RENEWAL 01-05-2007

Barron Lending, Inc.

Gainesvile

GA

B

01-05-2007 01-05-2007

Millennium Capital Mortgage Corporation

Longwood

FL

L

01-05-2007 01-05-2007

Family Home Loans, LLC *

Stone Mountain

GA

L

07-15-2005 01-12-2007

Kara Eve Garcia

Stone Mountain

GA

B

01-12-2007 01-12-2007

Global Mortgage Financial Group, Inc. 5 Stars Home Loan, LLC

Lake Worth Monroe

FL

B

GA

B

01-12-2007 01-12-2007

01-12-2007 01-12-2007

Innovative Mortgage Consultants, Inc. Admiral Lending, LLC

Baltimore Grand Rapids

MD

B

MI

L

01-12-2007 01-12-2007

01-12-2007 01-12-2007

Fulton & Kozak Mortgage Services, LLC Pioneer Mortgage Company

Morrow Cleveland

GA

B

TN

B

01-12-2007 01-19-2007

01-12-2007 01-19-2007

Lan Van Nguyen

Duluth

GA

B

01-19-2007 01-19-2007

Premier Mortgage Solutions, Inc.

Hyattsville

MD

B

01-19-2007 01-19-2007

Formula Mortgage Corporation

Hollywood

FL

B

01-19-2007 01-19-2007

C K Mortgage Processing, Inc.

Duluth

GA

P

01-19-2007 01-19-2007

Jori Lee Kasher

Duluth

GA

B

01-19-2007 01-19-2007

Multi-State Home Lending, Inc.

Laguna Hills

CA

L

01-19-2007 01-19-2007

Live Well Financial, Inc.

Richmond

VA

L

01-19-2007 01-19-2007

Charter Mortgage Investors, Inc.

Decatur

GA

B

01-19-2007 01-19-2007

American Home Mortgage Ventures, LLC Dollar Investment Corp. of Memphis
Metro Mortgage, Inc.

Melville Memphis Newnan

NY

R

TN

B

GA

B

01-19-2007 01-19-2007 01-19-2007

01-19-2007 01-19-2007 01-19-2007

Tristar Lending Corp.

Davie

FL

L

01-26-2007 01-26-2007

The Mortgage Firm, Inc.

Altamonte Springs

FL

L

01-26-2007 01-26-2007

North Country Mortgage Corp.

Islandia

NY

L

01-26-2007 01-26-2007

Mortgage Security Network, Inc.

Winter Springs

FL

L

01-26-2007 01-26-2007

Mortgage Affiliates of America, Inc. Danbury

CT

B

01-26-2007 01-26-2007

Borrower's Advantage Mortgage Corporation First Choice Lending & Investment Company The Funding Network, Inc.

Tampa Oakland Park Lawrenceville

GA

B

FL

L

GA

B

01-26-2007 01-26-2007 01-26-2007

01-26-2007 01-26-2007 01-26-2007

REINSTA TED

Continued on Page 8

Monthly Summary of Mortgage Activities For the Period Ending January 2007

Page 8

ID# 22196
22211 19197 11919 15256
16444
12465
17138

LICENSEES/REGISTRANTS APPROVED OR REINSTATED IN JANUARY 2007

MB

ORIGINAL

RENEWAL

COMPANY NAME

CITY

ST CODE

APPROVAL

Erasamus Land Acquisition Systems, Axis Home Lending Corporation NII Capital, LLC Harborside Financial Network, Inc.

Tampa Wauwatosa Wauwatosa San Marcos

FL

B

WI

B

WI

B

CA

L

01-26-2007 01-26-2007 06-25-2004 10-18-1996

01-26-2007 01-26-2007 01-05-2007 01-19-2007

Western Home Mortgage Corpora- Irvine

CA

B

12-17-1999

01-19-2007

Sierra Pacific Mortgage Company,

Folsom

CA

L

06-15-2001

01-19-2007

Mortgage Master, Inc. of MassachuAmanda C. Painter

Walpole Lake Park

MA

L

GA

B

05-09-1997 04-05-2002

01-26-2007 01-26-2007

REINSTA TED
01-05-2007 01-19-2007 01-19-2007 01-19-2007 01-26-2007 01-26-2007

TOTAL: 38

*

Upgrade Broker to Lender

+

Downgrade Lender to Broker

#

Upgrade Lender to Registrant



Downgrade Registrant to Lender

MB CODES B = BROKER L = LENDER R = REGISTRANT

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