hb 0817

CHAPTER 313

HB 817 - FINAL VERSION

AN ACT relative to the regulation of first and second mortgage brokers and mortgage servicers.

SPONSORS: Rep. Spiess, Hills 47

This bill makes various changes to the laws governing first and second mortgage brokers and providers of mortgage services.

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Matter which is either (a) all new or (b) repealed and reenacted appears in regular type.

AN ACT relative to the regulation of first and second mortgage brokers and mortgage servicers.

Be it Enacted by the Senate and House of Representatives in General Court convened:

313:1 Definitions; "Branch Office." RSA 397-A:1, II is repealed and reenacted to read as follows:

II. "Branch office" means a business location within this state of a person required to be licensed under this chapter. Branch office does not include a person's principal office location.

313:2 New Paragraph; Definitions; "Commissioner." Amend RSA 397-A:1 by inserting after paragraph II the following new paragraph:

313:3 New Paragraph; Definition; "Principal Office" Added. Amend RSA 397-A:1 by inserting after paragraph X the following new paragraph:

X-a. "Principal office" means the main office location of a person required to be licensed under this chapter.

313:4 License Application; Requirements; Investigation; Net Worth Statement, Service of Process Added. Amend RSA 397-A:5 to read as follows:

I. To be considered for licensing, each person shall complete and file with the banking department one verified application [~~required~~] prescribed by the [~~bank~~] commissioner. At a minimum, the application shall state the primary business address of the applicant, the address of its principal office and all branch offices located or to be located within the state, and a list of the principal owners, officers, and directors of the applicant. The applicant shall submit any other information that the [~~bank~~] commissioner may require.

II.(a). The license issued for the licensee's principal place of business shall be referred to as a "principal office license." Each additional license issued for first mortgage lending activity occurring in a location in this state that is separate from the licensee's principal place of business shall be referred to as a "branch office license." If the applicant or licensee desires to make or broker first mortgage loans in more than one location [~~within this state~~], the [~~bank~~] commissioner, upon favorable action on the applicant's principal office license, shall issue a branch office license for each location where the business of making or brokering first mortgage loans is to be conducted.

(b) Each license application shall be accompanied by a nonrefundable application fee of $250 for each separate office location [~~within this state~~] to be licensed. Sums collected under this chapter shall be payable to the state treasurer as restricted revenue and credited to the appropriation for the [~~bank~~] commissioner, consumer credit administration division.

(c) Each applicant shall be required to submit to the banking department detailed financial information sufficient for the [~~bank~~] commissioner to determine the applicant's ability to conduct the business of a mortgage banker or a mortgage broker with financial integrity. [~~At a minimum,~~] The application shall include a statement of net worth. Net worth statements provided in connection with a license application under this section shall be subject to review and verification during the course of any examination or investigation conducted under the authority of RSA 397-A:12. Each mortgage banker applicant [~~must~~] shall demonstrate a net worth of $100,000 [~~in cash or marketable securities or~~] or post a continuous surety bond in [~~said~~] the amount [~~as determined by rules adopted by the bank commissioner. At a minimum,~~] of $100,000. Each mortgage broker, or any person required to be licensed by this section and not funding a loan, shall [~~provide~~] post a continuous surety bond in the amount of $20,000 to the [~~bank~~] commissioner. [Net worth statements provided in connection with a license application under this section shall be subject to review and verification during the course of any examination or investigation conducted under the authority of RSA 397-A:12.] Surety bonds shall include a provision requiring the surety to give written notice to the commissioner 20 days in advance of the cancellation or termination of the bond. Every bond shall provide that no recovery may be made against the bond unless the state makes a claim for recovery or the person brings suit naming the principal within 6 years after the act upon which the recovery or suit is based.

III. Every applicant for licensing under this chapter shall file with the commissioner, in such form as the commissioner prescribes by rule, irrevocable consent appointing the commissioner to receive service of any lawful process in any non-criminal suit, action or proceeding against the applicant or the applicant's successor, executor, or administrator which arises under this chapter or any rule or order under this chapter after the consent has been filed, with the same force and validity as if served personally on the person filing the consent. A person who has filed such a consent in connection with a previous registration need not file another. When any person, including any nonresident of this state, engages in conduct prohibited or made actionable by this chapter or any rule or order under this chapter, and such person has not filed a consent to service of process under this section and personal jurisdiction over such person cannot otherwise be obtained in this state, that conduct shall be considered equivalent to such person's appointment of the commissioner to receive service of any lawful process. Service may be made by leaving a copy of the process in the office of the commissioner along with $5, but is not effective unless:

(a) The plaintiff, who may be the attorney general in a suit, action, or proceeding instituted by him or her, forthwith sends a notice of the service and a copy of the process by registered mail to the defendant or respondent at such person's last address on file with the commissioner; and

(b) The plaintiff's affidavit of compliance with this paragraph is filed in the case on or before the return day of the process, if any, or within such further time as the court allows.

IV.(a) Upon the applicant's filing of the complete application and payment of the required fee, the [~~bank~~] commissioner shall have, in accordance with RSA 541-A:29, up to 120 days to investigate and determine whether the applicant's financial resources, experience, personnel, and record of past or proposed conduct warrant the public's confidence and the issuance of a license.

(b) The [~~bank~~] commissioner shall determine whether the applicant's proposed interest rates and fees are in accordance with the interest rates and fees charged by other first mortgage lenders, and whether said rates and fees will promote a free and competitive market.

313:5 License Term; Renewal; Procedure Changed. RSA 397-A:8, II is repealed and reenacted to read as follows:

II. If a person holds a valid license under this section and is in compliance with this chapter and the rules thereunder, such licensee may renew the license by paying the required fee to the banking department on or before December 1 for the ensuing year that begins on January 1. Failure to renew the license shall result in the license terminating on December 31.

313:6 New Paragraph; Change in Name; Ownership; Location; Obligation to Update. Amend RSA 397-A:10 by inserting after paragraph III the following new paragraph:

IV. Persons licensed under this chapter are under a continuing obligation to update information on file with the commissioner. If any information filed with the commissioner becomes materially inaccurate, the licensee must promptly submit to the commissioner an amendment to its application records that will correct the information on file with the commissioner. An amendment shall be considered to be filed promptly if the amendment is filed within 30 days of the event that requires the filing of the amendment.

II. Those licensees that maintain their files in another state are required to return such files to their principal New Hampshire office or the office of their New Hampshire agent for examination no later than 21 calendar days after being requested to do so by the banking department. Failure to provide files and documents within the time established by this paragraph shall subject a licensee or person to a fine of $50 per day for each day after 21 days the files and documents are not produced. Failure to provide files and documents within 60 days after being requested to do so by the banking department shall be sufficient cause for license revocation, suspension, or denial.

III. The affairs and records [~~within this state~~] of every licensee shall be subject at any time to such periodic, special, regular, or other examination by the banking department with or without notice to the licensee. All books, papers, files, related material, and records of assets of the licensee shall be subject to the banking department's examination.

313:9 New Paragraphs; Examinations; Recovery of Costs Added. Amend RSA 397-A:12 by inserting after paragraph V the following new paragraphs:

VI. In any investigation to determine whether any person has violated or is about to violate this chapter or any rule or order under this chapter, upon the commissioner's finding that the person violated this chapter or a rule or order under this chapter, or the person charged with the violation being found in default, the commissioner shall be entitled to recover the cost of the investigation, in addition to any other penalty provided for under this chapter.

VII. Every person being examined, and all of the officers, directors, employees, agents, and representatives of such person shall make freely available to the commissioner or his or her examiners, the accounts, records, documents, files, information, assets, and matters in their possession or control relating to the subject of the examination and shall facilitate the examination.

VIII. Upon receipt of a written report of examination, the licensee shall have 30 days or such additional reasonable period as the commissioner for good cause may allow, within which to review the report, recommend any changes and set forth in writing the remedial course of action the licensee will pursue to correct any reported deficiencies outlined in the report.

IX. If so requested by the person examined, within the period allowed in paragraph VIII, or if deemed advisable by the commissioner without such request, the commissioner shall hold a closed hearing relative to the report and shall not file the report in the department until after such closed hearing and issuance of his or her order thereon. If no such closed hearing has been requested or held, the examination report, with such modifications, if any, as the commissioner deems proper, shall be accepted by the commissioner and filed upon expiration of the review period provided for in paragraph VIII. The report shall be accepted and filed within 6 months after the final hearing thereon.

X. All reports pursuant to this section shall be absolutely privileged and although filed in the department as provided in paragraph IX shall nevertheless not be for public inspection. The comments and recommendations of the examiner shall also be deemed confidential information and shall not be available for public inspection.

313:10 Annual Report; Financial Statement Added. Amend RSA 397-A:13, II - IV to read as follows:

II. Each licensee shall also file, under oath, its financial statement with the commissioner within 90 days from the date of its fiscal year end. The financial statement shall be prepared in accordance with generally accepted accounting principles with appropriate note disclosures. A first mortgage banker's financial statement shall include a balance sheet, income statement, statement of changes in owners' equity, and a cash flow statement. A first mortgage broker's financial statement shall include a balance sheet or a statement of net worth. If the financial statement filed under this section is not audited, a certification statement shall be attached and signed by a duly authorized officer of the licensee. The certification statement shall state that the financial statement is true and accurate to the best of the officer's belief and knowledge.

III. The banking department shall publish its analysis of the information required [~~under this section~~] in the licensee's annual report as a part of [~~its~~] the commissioner's annual report.

[~~III.~~] IV. Any licensee failing to file either the annual report or the financial statement required by this section within the time prescribed may be required to pay to the banking department a penalty of $25 for each calendar day the annual report or financial statement is overdue. [If a licensee elects to file a composite report and the composite report is not filed on or before February 1 as required in this section the penalty prescribed in this section shall apply separately for each license and branch license so violating.] The penalties for failure to file an annual report that are prescribed by this paragraph shall not apply to mortgage brokers licensed under this chapter who earned no money from purchasing, placing or selling first mortgage loans during the preceding year and who indicate such in writing to the banking department on or before February 1.

[~~IV.~~] V. In addition to the annual report and financial statement, the banking department may require such additional regular or special reports as it may deem necessary to the proper supervision of licensees under this chapter.

313:11 Advertising; "Licensed by the New Hampshire Banking Department" Added. Amend RSA 397-A:14-a, III to read as follows:

III. Any advertisement, printing, display, publication, distribution, or broadcast offering loans governed by this chapter shall clearly and conspicuously contain the [~~valid and existing license number issued~~] disclosure, "Licensed by the New Hampshire banking department" [~~under this chapter~~]. Failure to comply with the provisions of this paragraph shall constitute sufficient cause for license revocation, suspension, or denial.

313:12 Consumer Inquiries; Licensee's Response; Date of Transmission Changed. Amend RSA 397-A:15-a, II to read as follows:

II. A licensee who fails to respond to consumer complaints as required by this section within the time prescribed shall pay to the commissioner the sum of $50 for each day such response is overdue. For purposes of this section, the date of transmission shall be the date such response is [~~postmarked~~] received by the commissioner.

313:13 License Revocation; Suspension; Appeal; Show Cause Order, Opportunity for Hearing Added. RSA 397-A:17, I and II are repealed and reenacted to read as follows:

I. The commissioner may issue an order requiring the person to whom any license has been granted to show cause why the license should not be revoked. The order shall give reasonable notice of the opportunity for a hearing and shall state the reasons for the issuance of the order. The commissioner may by order, upon due notice and opportunity for hearing, assess penalties, deny, suspend or revoke a license if it is in the public interest and the applicant or licensee, any partner, officer, or director, any person occupying a similar status or performing similar functions, or any person directly or indirectly controlling the applicant or licensee:

(c) Has accepted or processed loan applications transmitted or brokered by a mortgage broker who is not licensed, and is not exempt from licensing, under this chapter;

(d) Has filed an application for licensing which as of its effective date, or as of any date after filing in the case of an order denying effectiveness, was incomplete in any material respect or contained any statement which was, in light of the circumstances under which it was made, false or misleading with respect to any material fact;

(e) Has made a false or misleading statement to the commissioner or in any reports to the commissioner;

(f) Has made fraudulent misrepresentations, has circumvented or concealed, through whatever subterfuge or device, any of the material particulars or the nature thereof required to be stated or furnished to a borrower under the provisions of this chapter;

(h) Is the subject of an order entered within the past 5 years by this state, any other state, or federal regulator denying, suspending or revoking licenses or registration;

(i) Is permanently, preliminarily, or temporarily enjoined by any court of competent jurisdiction from engaging in or continuing any conduct or practice involving any aspect of lending or collection activities;

(j) Is not qualified on the basis of such factors as experience, knowledge, and financial integrity;

(k) Has engaged in dishonest or unethical practices in the conduct of the business of making or collecting mortgage loans;

II. The banking department may, upon due notice and opportunity for a hearing, suspend any license for a period not exceeding 30 days, pending investigation by the banking department.

313:14 New Paragraphs; License Revocation; Suspension; Appeal; Entities; Licensee or Applicant not in Existence. Amend RSA 397-A:17 by inserting after paragraph V the following new paragraphs:

VI. If a licensee is a partnership, association, corporation, or entity however organized, it shall be sufficient cause for the suspension or revocation of a license that any officer, director, or trustee of a licensed association or corporation or any member of a licensed partnership has so acted or failed to act in behalf of said licensee as would be cause for suspending or revoking a license to such party as an individual. Each licensee shall be responsible for supervision of its branch offices and for the acts of any or all of its employees and originators while acting as its agent if such licensee, after actual knowledge of said acts, retained the benefits, proceeds, profits, or advantages accruing from said acts or otherwise ratified said acts.

VII. If the commissioner finds that any licensee or applicant for license is no longer in existence or has ceased to do business as a first mortgage broker or first mortgage banker, or cannot be located after reasonable search, the commissioner may by order revoke the license or deny the application. The commissioner may deem abandoned and withdraw any application for licensure made pursuant to this chapter, if any applicant fails to respond in writing within 180 days to a written request from the commissioner requesting a response. Such request shall be sent via certified mail to the last known address of the applicant that is on file with the commissioner.

313:15 Violations; Cease and Desist Order. Amend RSA 397-A:18 to read as follows:

I. The banking department may issue and serve upon any licensee or person over whom it has jurisdiction a complaint setting forth charges whenever the department is of the opinion that the licensee or person is violating or has violated any provision of this chapter or any rule or order under this chapter.

II. The banking department may issue a cease and desist order against any licensee or person who it has reasonable cause to believe is in violation of the provisions of this chapter or any rule or order under this chapter. Delivery of such order shall be by hand or registered mail at the principal office of the licensee or other person. The order shall be calculated to give reasonable notice of the rights of the person to request a hearing on the order and shall state the reasons for the entry of the order. A hearing shall be held not later than 10 days after the request for such hearing is received by the commissioner after which and within 20 days of the date of the hearing the commissioner shall issue a further order vacating the cease and desist order or making it permanent as the facts require. All hearings shall comply with 541-A. If the person to whom a cease and desist order is issued fails to appear at the hearing after being duly notified, such person shall be deemed in default, and the proceeding may be determined against him or her upon consideration of the cease and desist order, the allegations of which may be deemed to be true. If the person to whom a cease and desist order is issued fails to request a hearing within 30 calendar days of receipt of such order, then such person shall likewise be deemed in default, and the order shall, on the thirty-first day, become permanent, and shall remain in full force and effect until and unless later modified or vacated by the commissioner, for good cause shown.

[III. If, within 15 business days after being served with a cease and desist order, the licensee or other person fails or refuses to comply or obtain a valid license, such failure shall constitute a violation of the order and this chapter.]

313:16 Administration by Commissioner; Rulemaking; Basis for Actions. Amend RSA 397-A:20 to read as follows:

I. The [~~bank~~] commissioner shall administer and enforce the provisions of this chapter.

II. Pursuant to RSA 541-A, the [~~bank~~] commissioner may adopt such rules as he or she deems necessary to the administration and enforcement of this chapter. Such rules shall be consistent with the provisions of this chapter, and may include, but shall not be limited to, the following:

(d) Personal disclosure statements to meet the requirements of RSA 397-A:5, III.

III. The commissioner may prepare, alter, or withdraw such forms as are necessary to comply with the provisions of this title.

IV. The commissioner may issue, amend, or rescind such orders as are reasonably necessary to carry out the provisions of this chapter.

V. The commissioner may, for good cause shown, abate all or a portion of delinquency penalties assessed under this chapter.

VI. All actions taken by the commissioner pursuant to this chapter shall be taken only when the commissioner finds such action necessary or appropriate to the public interest or for the protection of consumers and consistent with the purposes fairly intended by the policy and provisions of this title.

313:17 Penalties; Knowing Violation, Negligent Violation Added. Amend RSA 397-A:21 to read as follows:

I. Any person who violates any provision of this chapter shall be guilty of a misdemeanor for each violation if a natural person, or guilty of a felony if any other person.

II. Any person who knowingly violates any rule or order of the commissioner may, upon notice and opportunity for hearing, except where another penalty is expressly provided, be subject to suspension or revocation of any registration or license, or imposition of an administrative fine not to exceed $2,500 for each violation in lieu of or in addition to suspension or revocation, as may be applicable under this title, for violation of the provision to which such rule or order relates. Each of the acts specified shall constitute a separate violation.

III. Any person who negligently violates any rule or order of the commissioner may, upon notice and opportunity for hearing, except where another penalty is expressly provided, be subject to suspension, revocation, or denial of any registration or license, including the forfeiture of any application fee, or the imposition of an administrative fine not to exceed $1,500 for each violation, in lieu of or in addition to suspension or revocation, as may be applicable under this title, for violation of the provision to which such rule or order relates. Each of the acts specified shall constitute a separate violation.

IV. Any person who, either knowingly or negligently, violates any provision of this chapter may, upon notice and opportunity for hearing, and in addition to any such other penalty provided for by law, be subject to suspension, revocation or denial of any registration or license, including forfeiture of any application fee, or an administrative fine not to exceed $2,500, or both. Each of the acts specified shall constitute a separate violation, and each such administrative action or fine may be imposed in addition to any criminal or civil penalties imposed.

V. Every person who directly or indirectly controls a person liable under this section, every partner, principal executive officer or director of such person, every person occupying a similar status or performing a similar function, every employee of such person who materially aids in the act constituting the violation, and every licensee or person acting as a common law agent who materially aids in the acts constituting the violation, either knowingly or negligently, may, upon notice and opportunity for hearing, and in addition to any other penalty provided for by law, be subject to suspension, revocation, or denial of any registration or license, including the forfeiture of any application fee, or the imposition of an administrative fine not to exceed $2,500, or both. Each of the acts specified shall constitute a separate violation, and such administrative action or fine may be imposed in addition to any criminal or civil penalties imposed. No person shall be liable under this paragraph who shall sustain the burden of proof that such person did not know, and in the exercise of reasonable care could not have known, of the existence of facts by reason of which the liability is alleged to exist.

313:18 Records and Filings. RSA 397-A:22 is repealed and reenacted to read as follows:

I. A document is filed when it is received by the commissioner. If any filing deadline date falls on a weekend or on a New Hampshire state or federal legal holiday, the due date shall be automatically extended to the next business day following such weekend or holiday.

II. Electronic filings, when received by the commissioner, are deemed filed, and are prima facie evidence that a filing has been duly authorized and made by the signatory on the application or document, are admissible in any civil or administrative proceeding under this chapter, and are admissible in evidence in accordance with the rules of superior court in any action brought by the attorney general under this chapter.

III. A licensee may maintain its records in electronic format if, upon request, the licensee provides the commissioner with:

(a) A full explanation of the programming of any data storage or communications systems in use; and

(b) Information from any books, records, electronic data processing systems, computers or any other information storage system in the form requested by the commissioner.

313:19 New Section; Severability. Amend RSA 397-A by inserting after section 22 the following new section:

397-A:23 Severability. If any provision of this chapter or the application thereof to any person or circumstance is held invalid, the invalidity does not affect other provisions or applications of the chapter which can be given effect without the invalid provisions or application and to this end the provisions of this chapter are severable.

313:20 Change from "Bank Commissioner" to "Commissioner." Amend the following RSA provisions by replacing "bank commissioner" with "commissioner": 397-A:6; 397-A:7; 397-A:10, I; 397-A:10-a, I; 397-A:15-a, I.

II. "First mortgage loan" shall have the same meaning as provided in RSA 397-A:1, III.

[~~II.~~] III. "Mortgage servicing company" means an individual, partnership, corporation, association, or other entity however organized and wherever located which, for itself or on behalf of the holder of a first mortgage loan, records such payments on its books and records and performs such other administrative functions as may be necessary to properly carry out the mortgage holder's obligations under the mortgage agreement including, when applicable, the receipt of funds from the mortgagor to be held in escrow for payment of real estate taxes and insurance premiums and the distribution of such funds to the taxing authority and insurance company.

[~~III.~~] IV. "Mortgagor" means any person or persons obligated to repay a first mortgage loan.

313:22 Administration by Commissioner; Rulemaking; Orders, Basis for Actions Added. Amend RSA 397-B:3 to read as follows:

I. The [~~bank~~] commissioner shall administer and enforce the provisions of this chapter and, pursuant to RSA 541-A, shall adopt such rules as the commissioner deems necessary to the administration and enforcement of this chapter.

II. The commissioner may prepare, alter, or withdraw such forms as are necessary to comply with the provisions of this title.

III. The commissioner may issue, amend, or rescind such orders as are reasonably necessary to carry out the provisions of this chapter.

IV. The commissioner may require such regular or special reports as the commissioner deems necessary to the proper supervision of licensees under this chapter.

V. The commissioner may, for good cause shown, abate all or a portion of delinquency penalties assessed under this chapter.

VII. If the commissioner finds that any registrant or applicant for registration is no longer in existence or has ceased to do business as a mortgage servicing company, or cannot be located after reasonable search, the commissioner may by order revoke the registration or deny the application. The commissioner may deem abandoned and withdraw any application for registration made pursuant to this chapter, if any applicant fails to respond in writing within 180 days to a written request from the commissioner requesting a response. Such request shall be sent via certified mail to the last known address of the applicant that is on file with the commissioner.

VIII. The commissioner may issue an order requiring the person to whom any registration has been granted to show cause why the registration should not be revoked. The registration may be revoked for violations of this chapter or any rule or order thereunder. The commissioner may issue a cease and desist order against any registrant or person whom he or she has reasonable cause to believe is in violation of the provisions of this chapter or any rule or order under this chapter. Delivery of such orders shall be by hand or registered mail at the principal office of the licensee or other person. The orders shall be calculated to give reasonable notice of the right of the person to request a hearing on the order and shall state the reasons for the entry of the order. A hearing shall be held not later than 10 days after the request for such hearing is received by the commissioner after which and within 20 days of the date of the hearing the commissioner shall issue a further order vacating the revocation or cease and desist order or making it permanent as the facts require. All hearings shall comply with 541-A. If the person to whom a revocation or cease and desist order is issued fails to appear at the hearing after being duly notified, such person shall be deemed in default, and the proceeding may be determined against him or her upon consideration of the revocation or cease and desist order, the allegations of which may be deemed to be true. If the person to whom a revocation or cease and desist order is issued fails to request a hearing within 30 calendar days of receipt of such order, then such person shall likewise be deemed in default, and the order shall, on the thirty-first day, become permanent, and shall remain in full force and effect until and unless later modified or vacated by the commissioner, for good cause shown.

IX. The commissioner may by order deny, suspend, or revoke any registration or application if the commissioner finds that the order is in the public interest and the applicant or registrant, any partner, officer or director, any person occupying a similar status or performing similar functions, or any person directly or indirectly controlling the applicant or registrant:

(a) Has filed an application for registration which as of its effective date, or as of any date after filing in the case of an order denying effectiveness, was incomplete in any material respect or contained any statement which was, in light of the circumstances under which it was made, false or misleading with respect to any material fact;

(b) Has made a false or misleading statement to the commissioner or in any reports to the commissioner;

(d) Is the subject of an order entered within the past 5 years by the state, any other state, or federal regulator denying, suspending or revoking licenses or registration;

(e) Is permanently, preliminarily, or temporarily enjoined by any court of competent jurisdiction from engaging in or continuing any conduct or practice involving any aspect of mortgage servicing or collection activities;

(f) Has engaged in dishonest or unethical practices in the conduct of the business of servicing or collecting mortgage loans;

(g) Has violated this chapter or any rule or order thereunder or has violated applicable federal laws or rules thereunder; or

313:23 Registration; Fees; Term; Renewal; Service of Process Added. Amend RSA 397-B:4 to read as follows:

I. Any mortgage servicing company which services first mortgage loans secured by real property located in the state of New Hampshire shall be required to register with the banking department by filing a registration statement on a form prescribed by the [~~bank~~] commissioner and paying an original registration fee of $100. Each such registration shall expire on [~~August~~] December 31 of each calendar year. A registration may be renewed by filing a renewal statement on a form prescribed by the [~~bank~~] commissioner and paying a renewal registration fee of $50, on or before, [~~August 31 of each calendar~~] December 1 for registration for the ensuing year. Sums collected under this chapter shall be payable to the state treasurer as restricted revenue and credited to the appropriation of the [~~bank~~] commissioner, consumer credit administration division.

II. Every applicant for registration under this chapter shall file with the commissioner, in such form as the commissioner prescribes by rule, irrevocable consent appointing the commissioner to receive service of any lawful process in any non-criminal suit, action or proceeding against the applicant or the applicant's successor, executor, or administrator which arises under this chapter or any rule or order under this chapter after the consent has been filed, with the same force and validity as if served personally on the person filing the consent. A person who has filed such a consent in connection with a previous registration need not file another. When any person, including any nonresident of this state, engages in conduct prohibited or made actionable by this chapter or any rule or order under this chapter, and such person has not filed a consent to service of process under this section and personal jurisdiction over such person cannot otherwise be obtained in this state, that conduct shall be considered equivalent to such person's appointment of the commissioner to receive service of any lawful process. Service may be made by leaving a copy of the process in the office of the commissioner along with $5, but is not effective unless:

(b) The plaintiff's affidavit of compliance with this paragraph is filed in the case on or before the return day of the process, if any, or within such further time as the court allows.

313:24 Penalties; Knowing and Negligent Violation, Parties Subject to License Suspension Added. Amend RSA 397-B:6 to read as follows:

I. Any mortgage servicing company which violates any provision of RSA 397-B:5 shall be liable to the mortgagor for:

[I.](a) Any penalties, interest or other charges levied by the taxing authority or insurance company as a result of such violation; and

[~~II.~~](b) Any actual damages suffered by the mortgagor as a result of such violation, including, but not limited to, late payment penalties and associated interest, and any amount which would have been paid by an insurer for a casualty or liability claim had the insurance policy not been cancelled for nonpayment by the mortgage servicing company; and

[~~III.~~](c) In the case of any successful action to enforce the foregoing liability, the costs of the action together with reasonable attorney's fees as determined by the court.

II. Any person who knowingly violates any rule or order of the commissioner may, upon notice and opportunity for hearing, except where another penalty is expressly provided, be subject to suspension or revocation of any registration or license, or the imposition of an administrative fine not to exceed $2,500 for each violation, in lieu of or in addition to such suspension or revocation, as may be applicable under this title, for violation of the provision to which such rule or order relates. Each of the acts specified shall constitute a separate violation.

III. Any person who negligently violates any rule or order of the commissioner may, upon notice and opportunity for hearing, except where another penalty is expressly provided, be subject to suspension, revocation, or denial of any registration or license, including the forfeiture of any application fee, or the imposition of an administrative fine not to exceed $1,500 for each violation, in lieu of or in addition to such suspension or revocation, as may be applicable under this title, for violation of the provision to which such rule or order relates. Each of the acts specified shall constitute a separate violation.

IV. Any person who, either knowingly or negligently, violates any provision of this chapter may, upon notice and opportunity for hearing, and in addition to any such other penalty provided for by law, be subject to suspension, revocation, or denial of any registration or license, including forfeiture of any application fee, or imposition of an administrative fine not to exceed $2,500, or both. Each of the acts specified shall constitute a separate violation, and each such administrative action or fine may be imposed in addition to any criminal or civil penalties imposed.

V. Every person who directly or indirectly controls a person liable under this section, every partner, principal executive officer or director of such person, every person occupying a similar status or performing a similar function, every employee of such person who materially aids in the act constituting the violation, and every licensee or person acting as a common law agent who materially aids in the acts constituting the violation, either knowingly or negligently, may, upon notice and opportunity for hearing, and in addition to any other penalty provided for by law, be subject to suspension, revocation, or denial of any registration or license, including the forfeiture of any application fee, or imposition of an administrative fine not to exceed $2,500, or both. Each of the acts specified shall constitute a separate violation, and such administrative action or fine may be imposed in addition to any criminal or civil penalties imposed. No person shall be liable under this paragraph who shall sustain the burden of proof that such person did not know, and in the exercise of reasonable care could not have known, of the existence of facts by reason of which the liability is alleged to exist.

313:25 Surrender; "Bank" Removed Before "Commissioner". Amend RSA 397-B:8, I to read as follows:

I. Registrants under this chapter who cease to engage in the business of servicing mortgage loans in this state at any time during a registration year for any cause, including but not limited to bankruptcy, registration revocation, or voluntary dissolution, shall surrender such registration in person or by registered or certified mail to the [~~bank~~] commissioner within 15 calendar days of such cessation, and shall cause to be published in a newspaper of general circulation in the state a notice to such effect. The [~~bank~~] commissioner shall adopt rules in accordance with RSA 541-A relative to such notice.

313:26 Investigations; Subpoenas; Injunctions; Costs Added. Amend RSA 397-B:9 to read as follows:

I. The banking department may make such public or private investigations within or outside of this state as it deems necessary to determine compliance with this chapter and the rules adopted pursuant to it. The expense of such investigation shall be chargeable to and paid by the mortgage servicing company. Sums collected under this section shall be payable to the state treasurer as restricted revenue and credited to the appropriation for the [~~bank~~] commissioner, consumer credit administration division.

II. For the purpose of any investigation under this chapter, the banking department shall have the power to subpoena witnesses and administer oaths in any adjudicative proceedings, and to compel, by subpoena duces tecum, the production of all books, records, files, and other documents and materials relevant to its investigation.

III. Whenever the [~~bank~~] commissioner has reason to believe that any mortgage servicing company has been engaged or is engaged in an alleged violation of this chapter, the commissioner may request the attorney general to seek an order from a court having jurisdiction for an injunction temporarily or permanently restraining and enjoining the continuance of such act or acts.

IV. Any action taken by the banking department or [~~bank~~] commissioner under this chapter shall not be considered as a limitation of a mortgagor's ability to seek such relief as may be provided by any statute or at common law.

V. In any investigation to determine whether any person has violated or is about to violate this chapter or any rule or order under this chapter, upon the commissioner's finding that the person violated this chapter or a rule or order under this chapter, or the person charged with the violation being found in default, the commissioner shall be entitled to recover the cost of the investigation, in addition to any other penalty provided for under this chapter.

313:27 Records and Filings. RSA 397-B:11 is repealed and reenacted to read as follows:

III. A licensee may maintain its records in electronic format if, upon request, the licensee provides the commissioner with

(a) A full explanation of the programming of any data storage or communications systems in use; and

(b) Information from any books, records, electronic data processing systems, computers or any other information storage system in the form requested by the commissioner.

313:28 New Section; Severability. Amend RSA 397-B by inserting after section 11 the following new section:

397-B:12 Severability. If any provision of this chapter or the application thereof to any person or circumstance is held invalid, the invalidity does not affect other provisions or applications of the chapter which can be given effect without the invalid provisions or application and to this end the provisions of this chapter are severable.

I. "Borrower" shall include any legal successor to the borrower's rights or obligations.

II. "Branch office" means a business location within this state of a person required to be licensed under this chapter. Branch office does not include a person's principal office location.

IV. "Lender"' means any person making a loan secured by a mortgage as described in this chapter and shall include any legal successor to the rights of the lender.

V. "Loan" means any loan of money or goods or forbearance of money and goods or choses in action.

VI. "Principal office" means the main office location of a person required to be licensed under this chapter.

VII. "Second mortgage banker" means a person not exempt under RSA 398-A:10 who for compensation or gain, or in the expectation of compensation or gain, either directly or indirectly:

(a) Makes or originates second mortgage loans as payee on the note evidencing the loan; or

(b) Advances, or offers to advance, or makes a commitment to advance the banker's own funds for second mortgage loans, or closes second mortgage loans with the banker's own funds; or

VIII. "Second mortgage broker" means a person not exempt under RSA 398-A:10 who for compensation or gain, or in the expectation of compensation or gain, either directly or indirectly:

(a) Acts as an intermediary, finder, or agent of a lender or borrower for the purpose of negotiating, arranging, finding, or procuring second mortgage loans, or commitments for second mortgage loans; or

(b) Offers to serve as agent for any person in an attempt to obtain a second mortgage loan; or

IX. "Second mortgage loan" means a loan which is secured in whole or in part by a mortgage upon any interest in real property used as a dwelling with accommodations for not more than 4 families, which property is subject to the lien of one or more prior mortgages.

313:30 License Required; Requirements Added. Amend RSA 398-A:1-a to read as follows:

I. No person shall engage in the business of second mortgage loans unless [he] the person [~~or his broker, agent or other representative~~] first obtains a license as provided herein, except when the person lending money is the seller of the real estate upon which the second mortgage is to be taken as security. [~~A person shall not be deemed to be in the business of second mortgage home loans if he or she makes not more than 4 second mortgage loans in a calendar year~~]. A person who is licensed under RSA 397-A to broker first mortgage loans may obtain a license under this chapter to broker second mortgage loans by filing a notice and paying the fee required by RSA 398-A:1-a, III. A person who is licensed under RSA 397-A as a mortgage banker may obtain a second mortgage loan license under this chapter to make second mortgage loans by filing a notice and paying the fee required by RSA 398-A:1-a, III.

II. The application for such license shall be in writing, under oath and in the form prescribed by the [~~bank~~] commissioner.

III. The non-refundable license fee for each calendar year or part thereof shall be $250 for the principal office and $250 for each branch office.

IV. Upon the filing of [~~such~~] a complete application and the payment of said fee, the commissioner shall investigate the interest to be imposed by the applicant in comparison with the interest generally charged by other lenders in the community in which the business of the applicant is to be conducted, and if he or she shall find:

(a) The financial responsibility, experience, character and general fitness of the applicant are such as to command the confidence of the public and to warrant the belief that the business will be operated lawfully, honestly and fairly within the purposes of this chapter; and [~~that~~]

(b) The applicant has available for use in such business at [~~the~~] each location specified in the application at least $25,000, or has such amount available, or actually invested in loans made under this chapter[,]; and [~~that~~]

(c) Allowing the applicant to engage in business will promote the convenience and advantage of the community in which the business of the applicant is to be conducted[,] he or she shall enter an order approving such application, shall issue licenses to the applicant's principal and branch offices, and shall deliver [~~a license~~] the licenses to the applicant for a period which shall expire the December 31 following the date of its issuance. Each license shall state the name and address of the licensee and shall be conspicuously posted in the licensee's place of business. The license shall not be transferable or assignable. No licensee shall transact any business provided for by this chapter under [~~any other trade name unless he shall have a separate license therefor~~] a trade name or any other name different from the name stated in its license unless the license reflects the trade name in addition to the licensee's legal name. If the commissioner shall not so find, he or she shall enter an order denying such application and immediately notify the applicant of the denial[~~, returning the license fee~~]. Before the corporate or trade name under which the licensed business is conducted is changed, the licensee shall give notice to the commissioner who shall amend the license accordingly without cost.

V. [The applicant shall also, at the same time file with the commissioner a surety company bond to the state, in the sum of $5,000, to be approved by the commissioner, for the use of the state and of any person who may have a cause of action against the principal in said bond under the provisions of this chapter and conditioned that he will conform to and abide by each provision of this chapter and will pay to the state and to any such person any sum that may become due or owing to the state or to such person from said principal under and by virtue of the provisions hereof.] No license shall be issued to any person whose principal place of business is located outside of this state unless that person designates an agent residing within this state for service of process.

VI. Each license issued under the provisions of this chapter shall state the name and address of the principal office of the licensee and, if the license is a branch office license, the name and address of the branch office location for which that license is issued.

VII. If a person holds a valid license under this section and is in compliance with this chapter and the rules thereunder, such licensee may renew the license by paying the required fee to the banking department on or before December 1 for the ensuing year that begins on January 1. Failure to renew the license shall result in the license terminating on December 31.

VIII. Persons making second mortgage home loans who are licensed under this chapter are under a continuing obligation to update information on file with the commissioner. If any information filed with the commissioner becomes materially inaccurate, the licensee must promptly submit to the commissioner an amendment to its application records that will correct the information on file with the commissioner. An amendment shall be considered to be filed promptly if the amendment is filed within 30 days of the event that requires the filing of the amendment.

313:31 Revocation; Show Cause Order, Actions by Another, Appeal, Licensee or Applicant not in Business; Cease and Desist Order Added. RSA 398-A:1-b is repealed and reenacted to read as follows:

I. The commissioner may by order, upon notice and opportunity for a hearing, deny, suspend or revoke a license if it is in the public interest and the applicant or licensee, any partner, officer or director, any person occupying a similar status or performing similar functions, or any person directly or indirectly controlling the applicant or licensee:

(b) Does not meet the standards established in RSA 398-A:1-a, IV. The licensee shall have a right of appeal to the board of trust company incorporation;

(c) Has filed an application for licensing which as of its effective date, or as of any date after filing in the case of an order denying effectiveness, was incomplete in any material respect or contained any statement which was, in light of the circumstances under which it was made, false or misleading with respect to any material fact;

(d) Has made a false or misleading statement to the commissioner or in any reports to the commissioner;

(e) Has made fraudulent misrepresentations, has circumvented or concealed, through whatever subterfuge or device, any of the material particulars or the nature thereof required to be stated or furnished to a borrower under the provisions of this chapter;

(g) Is the subject of an order entered within the past 5 years by this state, any other state, or federal regulator denying, suspending or revoking licenses or registration;

(h) Is permanently, preliminarily, or temporarily enjoined by any court of competent jurisdiction from in engaging in or continuing any conduct or practice involving any aspect of lending or collection activities;

(i) Is not qualified on the basis of such factors as experience, knowledge, and financial integrity;

(j) Has engaged in dishonest or unethical practices in the conduct of the business of making or collecting mortgage loans;

(k) Has violated this chapter or any rule or order thereunder or has violated applicable federal laws or rules thereunder; or

II. The commissioner may issue an order requiring the person to whom any license has been granted to show cause why the license should not be revoked. The order shall be calculated to give reasonable notice of the opportunity for hearing, and shall state the reasons for the issuance of the order. A license may be suspended or revoked by the commissioner for violation of this chapter or any rule or order thereunder, for violation of applicable federal laws, or for other good cause shown.

III. If a licensee is a partnership, association, corporation, or entity however organized, it shall be sufficient cause for the suspension or revocation of a license that any officer, director, or trustee of a licensed association or corporation or any member of a licensed partnership has so acted or failed to act in behalf of said licensee as would be cause for suspending or revoking a license to such party as an individual. Each licensee shall be responsible for supervision of its branch offices and for the acts of any or all of its employees and originators while acting as its agent if such licensee, after actual knowledge of said acts, retained the benefits, proceeds, profits, or advantages accruing from said acts or otherwise ratified said acts.

IV. Any license revocation, suspension, or unfavorable action by the department on a license shall comply with the provisions of RSA 541-A. An aggrieved licensee may, pursuant to RSA 541-A and RSA 541, appeal an unfavorable action by the department. The department may take action for immediate suspension of a license, pursuant to RSA 541-A.

V. If the commissioner finds that any licensee or applicant for license is no longer in existence or has ceased to do business as a retail seller or sales finance company, or cannot be located after reasonable search, the commissioner may by order revoke the license or deny the application. The commissioner may deem abandoned and withdraw any application for licensure made pursuant to this chapter, if any applicant fails to respond in writing within 180 days to a written request from the commissioner requesting a response. Such request shall be sent via certified mail to the last known address of the applicant that is on file with the commissioner.

VI. The commissioner may issue a cease and desist order against any licensee or person who it has reasonable cause to believe is in violation of the provisions of this chapter or any rule or order under this chapter. Delivery of such order shall be by hand or registered mail at the principal office of the licensee or other person. The order shall be calculated to give reasonable notice of the rights of the person to request a hearing on the order and shall state the reasons for the entry of the order. A hearing shall be held not later than 10 days after the request for such hearing is received by the commissioner after which and within 20 days of the date of the hearing the commissioner shall issue a further order vacating the cease and desist order or making it permanent as the facts require. All hearings shall comply with 541-A. If the person to whom a cease and desist order is issued fails to appear at the hearing after being duly notified, such person shall be deemed in default, and the proceeding may be determined against him or her upon consideration of the cease and desist order, the allegations of which may be deemed to be true. If the person to whom a cease and desist order is issued fails to request a hearing within 30 calendar days of receipt of such order, then such person shall likewise be deemed in default, and the order shall, on the thirty-first day, become permanent, and shall remain in full force and effect until and unless later modified or vacated by the commissioner, for good cause shown.

313:32 Examinations; Subpoena Power, Reports Added. Amend RSA 398-A:1-c to read as follows:

I. For the purpose of discovering violations of this chapter and the Consumer Credit Protection Act, as amended (15 U.S.C. 1601 et seq.) the commissioner may, either personally or by any person designated by the commissioner, at any time, investigate the loans and business of any licensee and of any person, partnership, or corporation by whom any such loan shall be made, whether such person, partnership, or corporation shall act, or claim to act, as principal, agent, or broker, or under or without the authority of this chapter; and for that purpose the commissioner shall have free access to the books, papers, records, and vaults of all such persons, partnerships, and corporations. The commissioner shall also have authority to examine, under oath, all persons whose testimony the commissioner may require, relative to such loans or business.

II. The commissioner shall have the power to issue a subpoena to compel the attendance of witnesses and the production of documents, papers, books, records, and other evidence before the commissioner in any matter over which the commissioner has jurisdiction, control or supervision pertaining to the provisions of this chapter. The commissioner shall have the power to administer oaths and affirmation to any person whose testimony is required. If any person shall refuse to obey any such subpoena or to give testimony or to produce evidence as required thereby, any justice of the superior court may, upon application and proof of such refusal, order the issuance of a subpoena, or subpoena duces tecum, out of the superior court, for the witness to appear before the superior court to give testimony, and to produce evidence as required thereby. Upon filing such order in the office of the clerk of the superior court, the clerk shall issue such subpoena, as directed, requiring the person to whom it is directed to appear at the time and place therein designated. If any person served with any such subpoena shall refuse to obey the same, and to give testimony, and to produce evidence as required thereby, the commissioner may apply to any justice of the superior court who, after proof of such refusal, shall issue such citation, directed to any sheriff, for the arrest of such person, and, upon such person's being brought before such justice, proceed to a hearing of the case. The court shall have power to enforce obedience to such subpoena, and the answering of any question and the production of any evidence that may be proper, by a fine not exceeding $10,000 or by imprisonment, or by both.

III. The commissioner may require such regular or special reports or other information as the commissioner may deem necessary to the proper supervision of licensees under this chapter.

IV. Those licensees or persons that maintain their files and business documents in another state shall appoint a New Hampshire agent and shall return such files and documents to their principal New Hampshire office or the office of their New Hampshire agent for examination no later than 21 calendar days after being requested to do so by the banking department. Failure to provide files and documents within the time established by this paragraph shall subject a licensee or person to a fine of $50 per day for each day after 21 days the files and documents are not produced. Failure to provide files and documents within 60 days after being requested to do so by the banking department shall be sufficient cause for license revocation, suspension, or denial or other penalties under this chapter.

313:33 Costs; Costs Against Person in Violation Added. Amend RSA 398-A:1-d to read as follows:

I. The commissioner may make such an examination of the affairs, business, office, and records of any licensee. The expense of such examination shall be chargeable to and paid by the institution. The procedure for such payment shall be the same as for payments by institutions for cost of examinations under RSA 383:11. Sums collected under this chapter shall be payable to the state treasurer as restricted revenue and credited to the appropriation for the [~~bank~~] commissioner, consumer credit administration division.

II. In any investigation to determine whether any person has violated or is about to violate this chapter or any rule or order under this chapter, upon the commissioner's finding that the person violated this chapter or a rule or order under this chapter, or the person charged with the violation being found in default, the commissioner shall be entitled to recover the cost of the investigation, in addition to any other penalty provided for under this chapter.

III. Every person being examined, and all of the officers, directors, employees, agents and representatives of such person shall make freely available to the commissioner or the commissioner's examiners the accounts, records, documents, files, information, assets, and matters in their possession or control relating to the subject of the examination and shall facilitate the examination.

IV. Upon receipt of a written report of examination, the licensee shall have 30 days or such additional reasonable period as the commissioner for good cause may allow, within which to review the report, recommend any changes, and set forth in writing the remedial course of action the licensee will pursue to correct any reported deficiencies outlined in the report.

V. If requested by the person examined, within the period allowed in paragraph IV, or if deemed advisable by the commissioner without such request, the commissioner shall hold a closed hearing relative to the report and shall not file the report in the department until after such closed hearing and issuance of the commissioner's order thereon. If no such closed hearing has been requested or held, the examination report, with such modifications, if any, to the report as the commissioner deems proper, shall be accepted by the commissioner and filed upon expiration of the review period provided for in paragraph IV. The report shall in any event be accepted and filed within 6 months after the final hearing thereon.

VI. All reports pursuant to this section shall be absolutely privileged and, although filed in the department as provided in paragraph V, shall not be for public inspection. The comments and recommendations of the examiner shall also be deemed confidential information and shall not be available for public inspection.

313:34 Report; Financial Statement Added. Amend RSA 398-A:1-e to read as follows:

I. Each licensee shall file with the commissioner on or before February 1 of each year a report under oath concerning the business and operations for the preceding calendar year ending December 31 in the form prescribed by the commissioner. [Whenever a licensee operated 2 or more licensed offices or whenever 2 or more affiliated licensees operated licensed offices, then a composite report of such group of licensed offices may be filed in lieu of individual reports.] The commissioner shall publish an analysis of the information required under this section as a part of his or her annual report. Any licensee failing to file the report required by this section within the time prescribed shall pay to the commissioner the sum of $25 for each calendar day the report is overdue. [If a licensee elects to file a composite report and such composite report is not filed on or before February 1 as required under this section, the penalty prescribed in this section shall apply separately for each license held.]

II. Each licensee shall also file, under oath, its financial statement with the commissioner within 90 days from the date of its fiscal year end. The financial statement shall be prepared in accordance with generally accepted accounting principles and shall include a balance sheet, income statement, statement of changes in owners' equity, a cash flow statement and note disclosures. If the financial statement is not audited, a certification statement shall be attached and signed by a duly authorized officer of the sales finance company. The certification statement shall state that the financial statement is true and accurate to the best of the officer's belief and knowledge. Any licensee failing to file the financial statement required by this section within the time prescribed shall pay to the commissioner the sum of $25 for each calendar day the report is overdue.

313:35 Consumer Inquiries; Response to Consumer Complaint; Date of Transmission Changed. Amend RSA 398-A:6-a, II to read as follows:

313:36 Penalties; Knowing and Negligent Violation, Actions by Another, Added. Amend RSA 398-A:7-a to read as follows:

I. Any person who wilfully violates any provision of this chapter shall be guilty of a misdemeanor if a natural person, or guilty of a felony if any other person, for each such violation.

III. Any person who negligently violates any rule or order of the commissioner may, upon notice and opportunity for hearing, except where another penalty is expressly provided, be subject to suspension, revocation, or denial of any registration or license, including the forfeiture of any application fee, or imposition of administrative fine not to exceed $1,500 for each violation in lieu of or in addition to suspension or revocation, as may be applicable under this title, for violation of the provision to which such rule or order relates. Each of the acts specified shall constitute a separate violation.

IV. Any person who, either knowingly or negligently, violates any provision of this chapter may, upon notice and opportunity for hearing, and in addition to any such other penalty provided for by law, be subject to suspension, revocation or denial of any registration or license, including forfeiture of any application fee, or imposition of an administrative fine not to exceed $2,500, or both. Each of the acts specified shall constitute a separate violation, and each such administrative action or fine may be imposed in addition to any criminal or civil penalties imposed.

V. Every person who directly or indirectly controls a person liable under this section, every partner, principal executive officer or director of such person, every person occupying a similar status or performing a similar function, every employee of such person who materially aids in the act constituting the violation, and every licensee or person acting as a common law agent who materially aids in the acts constituting the violation, either knowingly or negligently, may, upon notice and opportunity for hearing, and in addition to any other penalty provided for by law, be subject to suspension, revocation, or denial of any registration or license, including the forfeiture of any application fee, or imposition of an administrative fine not to exceed $2,500, or both. Each of the acts specified shall constitute a separate violation, and such administrative action or fine may be imposed in addition to any criminal or civil penalties imposed. No person shall be liable under this paragraph who shall sustain the burden of proof that such person did not know, and in the exercise of reasonable care could not have known, of the existence of facts by reason of which the liability is alleged to exist.

313:37 Rulemaking Authority; Orders, Basis for Actions, Added. Amend RSA 398-A:13 to read as follows:

I. The [~~bank~~] commissioner shall adopt rules, pursuant to RSA 541-A, relative to the administration and enforcement of this chapter governing institutions which make second mortgage loans within the state of New Hampshire [~~relative~~] including but not limited to the following:

[~~III.~~](c) Procedures for responding to consumer concerns and inquiries.

II. The commissioner may prepare, alter, or withdraw such forms as are necessary to comply with the provisions of this title.

III. The commissioner may issue, amend, or rescind such orders as are reasonably necessary to carry out the provisions of this chapter.

IV. The commissioner may, for good cause shown, abate all or a portion of delinquency penalties assessed under this chapter.

V. All actions taken by the commissioner pursuant to this chapter shall be taken only when the commissioner finds such action necessary or appropriate to the public interest or for the protection of consumers and consistent with the purposes fairly intended by the policy and provisions of this title.

313:38 New Section; Records and Filings. Amend RSA 398-A by inserting after section 13 the following new section:

III. A licensee may maintain its records in electronic format if, upon request, the licensee provides the commissioner with:

(a) A full explanation of the programming of any data storage or communications systems in use; and

(b) Information from any books, records, electronic data processing systems, computers or any other information storage system in the form requested by the commissioner.

313:39 Change from "Bank Commissioner" to "Commissioner." Amend the following RSA provisions by replacing "bank commissioner" with "commissioner": 398-A:1-f; 398-A:6-a, I; 398-A:11; and 398-A:12.

I. RSA 397-A:4, VIII, relative to exemptions from the licensing of nondepository first mortgage bankers and brokers.

II. RSA 398-A:10, VIII, relative to exemptions from the regulation of second mortgage home loans.

313:41 Revocation; SB 181 Amendment. Amend RSA 398-A:1-b, I(b)to read as follows:

(b) Does not meet the standards established in RSA 398-A:1-a, IV[~~. The licensee shall have a right of appeal to the board of trust company incorporation~~];

313:42 Nullification of SB 181 Amendment. RSA 398-A:1-b as inserted by 2003, 166:2 (SB 181) shall not take effect.

313:43 Contingent Amendment; SB 121; New Paragraph; Definition. Amend RSA 398-A:1 by inserting after paragraph V the following new paragraph:

V-a. "Originator" means an individual who is employed or retained and supervised by a mortgage lender or broker required to be licensed under RSA 397-A or 398-A, and who, for compensation or gain or in the expectation of compensation or gain, negotiates, solicits, arranges, or finds a mortgage loan. No individual may act as an originator for more than one licensee.

313:44 Contingent Amendment; SB 121. RSA 398-A:1-a, II is repealed and reenacted to read as follows:

II. The application for such license shall be in writing, under oath and in the form prescribed by the commissioner. Each applicant shall provide a list of all individuals, and the address of the work location of each such individual, who will act as originators for the licensee.

313:45 Contingent Amendment; SB 121. RSA 398-A:1-e, I is repealed and reenacted to read as follows:

I. Each licensee shall file with the commissioner on or before February 1 of each year a report under oath concerning the business and operations for the preceding calendar year ending December 31 in the form prescribed by the commissioner. The annual report shall include a list of all individuals, and the address of the work location of each such individual, who act as originators for the licensee. The commissioner shall publish an analysis of the information required under this section as a part of his or her annual report. Any licensee failing to file the report required by this section within the time prescribed shall pay to the commissioner the sum of $25 for each calendar day the report is overdue.

313:46 Contingency. If SB 121-FN of the 2003 session becomes law, then sections 43 -45 of this act shall take effect at 12:01 a.m. on the effective date of sections 1-40 of this act. If SB 121-FN of the 2003 session does not become law, then sections 42 - 45 of this act shall not take effect.

(Effective Date: I. Sections 43 - 45 shall take effect as provided in section 46

II. Section 41 shall take effect January 1, 2004

III. Remainder shall take effect August 20, 2003)