Minnesota Origination Reference Guide
- Kacey Olson
Owned by Kacey Olson
| Citation | Topic | Requirement |
| Residential Mortgage Originator and Servicer Licensing Act / Minn. Stat. Ann. §58.16 | Agency Relationship Disclosure | A residential mortgage originator who creates a fiduciary relationship with a borrower must provide a copy of the written contract to each borrower at or before the time of receipt of any fee paid for mortgage origination services. This does not apply to mortgage brokers who do not solicit or receive an advance fee. |
| Financial Corporations / Minn. Stat. Ann. §47.58(8) | Applicant Certification of Counseling | Prior to accepting a final and complete application for a reverse mortgage loan or charging any fees, a lender must receive a certification from the applicant or the applicant's authorized representative that the applicant has received counseling. The certification must be signed by the applicant and the counselor from the independent agency and must include the date of the counseling, the name, address and telephone number of both the mortgagor and the organization providing counseling. The lender must keep the certification as part of its records for the term of the loan. |
| Regulated Loan Act / Minn. Stat. Ann. §56.12 | Blank Spaces | A lender may not take any instrument in which blanks are left to be filled in after execution. |
| Financial Corporations / Minn. Stat. Ann. §47.20(8) | Copy of the Promissory Note and Mortgage | A lender making a conventional loan must give to the borrower a conformed copy of the promissory note and mortgage at the time they are executed or within a reasonable time after recordation of the mortgage. |
| Regulated Loan Act / Minn. Stat. Ann. §56.155(1) | Credit Insurance Disclosure | A statement must be made orally, except for loans by mail, and provided in writing to the borrower before the transaction is completed for each credit life, accident and health, and involuntary unemployment insurance coverage sold. In addition, the lender must disclose: (1) whether or not the benefits commence as of the first day of disability or involuntary unemployment; and (2) the number of days that an insured borrower must be disabled or involuntarily unemployed before benefits, whether retroactive or not, commence if a borrower procures insurance by or through a lender, the lender must disclose the cost to the borrower and the type of insurance, and the lender must cause to be delivered to the borrower a copy of the policy, certificate, or other evidence thereof, within a reasonable time. |
| Residential Mortgage Originator and Servicer Licensing Act / Minn. Stat. Ann. §58.16(6) | Disbursement of Trust Account Funds | At least monthly, the borrower must be provided a detailed written accounting of all disbursement of the borrower's funds from the trust account. |
| Residential Mortgage Originator and Servicer Licensing Act / Minn. Stat. Ann. §58.16(7) | Disclosure of Lenders or Loan Sources | This disclosure must be provided at the expiration of a contract for mortgage brokerage services. |
| Regulated Loan Act / Minn. Stat. Ann. §47.201(6) | Graduated Payment Disclosure | Each prospective borrower must receive materials explaining in reasonably simple terms the graduated payment home loan offered and a comparable standard conventional loan or cooperative apartment loan instrument with a fixed interest rate and level payments. The material must include: (A) a comparison of the terms of the graduated payment home loan and a standard conventional loan or cooperative apartment loan; (B) payment schedules for both types of instruments and the total payment in dollars over the full term of the loan (C) a description of the conversion option; and (D) a prominent statement that borrowers have the option to elect a standard conventional loan or cooperative apartment loan instrument. |
| Financial Corporations / Minn. Stat. Ann. §47.58(8) | Housing Counseling Agencies | Prior to accepting a final and complete application for a reverse mortgage loan or charging any fees, a lender must: (1) refer the borrower to an independent housing counseling agency. The lender must provide the prospective borrower with a list of at least 3 independent housing counseling agencies; and (2) receive a certification from the applicant or the applicant's authorized representative that the applicant has received counseling. |
| Residential Mortgage Originator and Servicer Licensing Act / Minn. Stat. Ann. §58.13(18) | Lower Investment Grade Loan Consent Disclosure | A residential mortgage originator may not make, provide, or arrange for a residential mortgage loan that is of a lower investment grade if the borrower's credit score, or comparable underwriting data, indicates that the borrower may qualify for a residential mortgage loan, available from or through the originator, that is of a higher investment grade, unless the borrower is informed that the borrower may qualify for a higher investment grade loan with a lower interest rate and/or lower discount points, and the borrower consents in writing to receipt of the lower investment grade loan. |
| Secure and Fair Enforcement for Mortgage Licensing Act / Minn. Stat. Ann. §58A.20 | NMLS Unique Identifier | The unique identifier of any person originating a residential mortgage loan must be clearly shown on all residential mortgage loan application forms, solicitations, or advertisements, including business cards or Web sites, and any other documents as established by rule or order of the Commissioner. |
| Residential Mortgage Originator and Servicer Licensing Act / Minn. Stat. Ann. §58.15 | Nonagency Disclosure | This disclosure must be provided within 3 business days of application if a residential mortgage originator does not contract or offer to contract to act as an agent of a borrower or accept an advance fee. This disclosure must be a separate document. |
| Financial Corporations / Minn. Stat. Ann. §47.20(2) | Notice of Default (Conventional Loans) | A lender making a conventional loan must ensure that the mortgage evidencing a conventional loan contains a provision whereby the lender, if it intends to foreclose, agrees to give the borrower written notice of any default under the terms or conditions of the promissory note or mortgage (Notice of Default). The lender must send the Notice of Default by certified mail to the address of the mortgaged property or another address the borrower may have designated in writing to the lender. The lender does not need to give the borrower the Notice of Default if the default consists of the borrower selling the mortgaged property without the required consent of the lender. |
| Financial Corporations / Minn. Stat. Ann. §47.20(9)(a) | Notice of Right to Discontinue Escrow | A mortgagee must allow a borrower to elect to discontinue escrowing for taxes and homeowner's insurance after the 5th anniversary of the date of the mortgage, unless the borrower has been more than 30 days delinquent in the previous 12 months. The borrower's election must be in writing. The lender or mortgage broker must notify an applicant of this right at or prior to closing of the mortgage loan. |
| Financial Corporations / Minn. Stat. Ann. §47.59(6) | Optional Insurance Disclosure | An additional charge may be made and included in the principal amount of a loan for credit insurance or mortgage insurance providing life, accident, health, or unemployment coverage written in connection with the loan if: (1) the insurance coverage is not required by the financial institution, and this fact is clearly and conspicuously disclosed in writing to the borrower; and (2) the borrower gives specific, dated, and separately signed affirmative written indication of the borrower's desire to do so after written disclosure to the borrower of the cost of the insurance. |
| Financial Corporations / Minn. Stat. Ann. §47.206(2) | Rate Lock Agreement | A lender offering borrowers the opportunity to enter into an agreement in advance of closing must disclose, in writing, to the borrowers at the time the offer is made: (1) a definite expiration date or term of the agreement, which may not be less than the reasonably anticipated closing date or time required to process, approve, and close the loan; (2) the circumstances, if any, under which the borrower will be permitted to close at a lower rate of interest or points than expressed in the agreement; (3) the steps required to process, approve, and close the loan, including the actions required of the borrower and lender; (4) that the agreement is enforceable by the borrower; and (5) the consideration required for the agreement. |
| Financial Corporations / Minn. Stat. Ann. §47.59(6) | Right to Choose Insurance Provider | This disclosure must be provided if an additional charge is made for insurance written in connection with a loan. |
| Residential Mortgage Originator and Servicer Licensing Act / Minn. Stat. Ann. §58.13(1) | Tangible Net Benefit Worksheet | A person licensee may not engage in churning. “Churning” means knowingly or intentionally making, providing, or arranging for a residential mortgage loan when the new residential mortgage loan does not provide a reasonable, tangible net benefit to the borrower considering all of the circumstances including the terms of both the new and refinanced loans, the cost of the new loan, and the borrower's circumstances. |
| Regulated Loan Act / Minn. Stat. Ann. §47.20(4b) | Shared Appreciation Disclosure (if applicable) | Before a conventional loan is made, the lender must disclose to the mortgagor or mortgagors the terms and conditions upon which the lender or mortgagee will receive any share of future appreciation of the mortgaged property. |
| Regulated Loan Act / Minn. Stat. Ann. §47.59(12) | Finance Charge (Open-End Loans) | A lender must give the following disclosure to the borrower in writing at the time an open-end credit account is established if the lender imposes a loan fee, points, or similar charge that relates to the opening of the account which is not included in the annual percentage rate given pursuant to the federal Truth in Lending Act: YOU HAVE BEEN ASSESSED FINANCE CHARGES, OR POINTS, WHICH ARE NOT INCLUDED IN THE ANNUAL PERCENTAGE RATE. THESE CHARGES MAY BE REFUNDED, IN WHOLE OR IN PART, IF YOU DO NOT USE YOUR LINE OF CREDIT OR IF YOU REPAY YOUR LINE OF CREDIT EARLY. THESE CHARGES INCREASE THE COST OF YOUR CREDIT. |
| Regulated Loan Act / Minn. Stat. Ann. §56.125(4) | Surrender of Homestead Exemption (Open-End Loans) | Prior to any licensee taking a lien upon the borrower's homestead as security for any open-end loan, the borrower must be provided with a statement, signed and dated by the borrower at the time of the execution of the contract surrendering the homestead exemption, immediately adjacent to a listing of the homestead property. |
| Residential Mortgage Originator and Servicer Licensing Act / Minn. Stat. Ann. §58.137(2) | Prepayment Disclosure (Application) | This disclosure must be provided verbally at application and on a separate document within 5 days of application if a residential mortgage originator offers or makes a loan that charges a prepayment penalty, fee, premium, or other charge greater than that permitted by Minn. Stat. Ann. § 58.137(2)(a)(4). |
| Residential Mortgage Originator and Servicer Licensing Act / Minn. Stat. Ann. §58.137(2) | Prepayment Disclosure (Closing) | This disclosure must be provided verbally and as a separate document within 3 days prior to the close of a loan if a residential mortgage originator offers or makes a loan that charges a prepayment penalty, fee, premium, or other charge greater than that permitted by Minn. Stat. Ann. §58.137(2)(a)(4). |