2025 -- H 5811

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LC001765

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     STATE OF RHODE ISLAND

IN GENERAL ASSEMBLY

JANUARY SESSION, A.D. 2025

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A N   A C T

RELATING TO FINANCIAL INSTITUTIONS -- AN ACT ADOPTING THE FEDERAL

SECURE AND FAIR ENFORCEMENT FOR MORTGAGE LICENSING ACT OF 2009

     Introduced By: Representatives Voas, Stewart, Kazarian, Casimiro, Solomon, O'Brien,
and Potter

     Date Introduced: February 28, 2025

     Referred To: House Corporations

     (Dept. of Business Regulation)

It is enacted by the General Assembly as follows:

     SECTION 1. Section 19-14.10-17 of the General Laws in Chapter 19-14.10 entitled "An

Act Adopting the Federal Secure and Fair Enforcement for Mortgage Licensing Act of 2009" is

hereby amended to read as follows:

     19-14.10-17. Prohibited acts and practices.

     It is a violation of this chapter for a person or individual subject to this chapter to:

     (1) Directly or indirectly employ any scheme, device, or artifice to defraud or mislead

borrowers or lenders or to defraud any person;

     (2) Engage in any unfair or deceptive practice toward any person;

     (3) Obtain property by fraud or misrepresentation;

     (4) Solicit or enter into a contract with a borrower that provides in substance that the person

or individual subject to this chapter may earn a fee or commission through “best efforts” to obtain

a loan even though no loan is actually obtained for the borrower;

     (5) Solicit, advertise, or enter into a contract for specific interest rates, points, or other

financing terms unless the terms are actually available at the time of soliciting, advertising, or

contracting;

     (6) Conduct any business covered by this chapter without holding a valid license as

required under this chapter, or assist or aid and abet any person in the conduct of business under

this chapter without a valid license as required under this chapter;

     (7) Fail to make disclosures as required by this chapter and any other applicable state or

federal law including regulations thereunder;

     (8) Fail to comply with this chapter or rules or regulations promulgated under this chapter,

or fail to comply with any other state or federal law, including the rules and regulations thereunder,

applicable to any business authorized or conducted under this chapter;

     (9) Make, in any manner, any false or deceptive statement or representation with regard to

the rates, points, or other financing terms or conditions for a residential mortgage loan, or engage

in bait-and-switch advertising;

     (10) Negligently make any false statement or knowingly and willfully make any omission

of material fact in connection with any information or reports filed with a governmental agency or

the Nationwide Mortgage Licensing System and Registry or in connection with any investigation

conducted by the director, or the director’s designee, or another governmental agency;

     (11) Make any payment, threat, or promise, directly or indirectly, to any person for the

purposes of influencing the independent judgment of the person in connection with a residential

mortgage loan, or make any payment, threat, or promise, directly or indirectly, to any appraiser of

a property, for the purposes of influencing the independent judgment of the appraiser with respect

to the value of the property;

     (12) Collect, charge, attempt to collect or charge, or use or propose any agreement

purporting to collect or charge, any fee prohibited by this chapter;

     (13) Cause or require a borrower to obtain property insurance coverage in an amount that

exceeds the replacement cost of the improvements as established by the property insurer; or

     (14) Fail to truthfully account for monies belonging to a party to a residential mortgage

loan transaction. ; or

     (15) Act in the capacity of and compensated as both a real estate agent and mortgage loan

originator in the same transaction.

     SECTION 2. This act shall take effect upon passage.

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EXPLANATION

BY THE LEGISLATIVE COUNCIL

OF

A N   A C T

RELATING TO FINANCIAL INSTITUTIONS -- AN ACT ADOPTING THE FEDERAL

SECURE AND FAIR ENFORCEMENT FOR MORTGAGE LICENSING ACT OF 2009

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     This act would prohibit an individual who is licensed as both a Rhode Island real estate

agent and mortgage loan originator to be compensated for both the sale of the property and the

origination or referral of the loan in securing the property.

     This act would take effect upon passage.

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LC001765

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