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This topic consolidates legislative summaries of new and revised state laws pertaining to licensing, originating, and servicing mortgage loans. 

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March 29, 2019

Virginia allows institutions to refuse transactions if elder exploitation is suspected

Buckley Sandler, LLP--InfoBytes Blog

On March 18, the Virginia Governor signed HB 1987, which authorizes staff of financial institutions to refuse a transaction, delay a transaction, or refuse to disburse transaction funds if the staff member (i) has a good faith belief that the transaction may involve the financial exploitation of an aged or incapacitated adult; or (ii) files a report or has knowledge that a report has been filed with the responsible local authority that states in good faith that the transaction may involve financial exploitation of an aged or incapacitated adult. Unless authorized by a court, the bill allows the continued refusal for up to 30 days after the date the transaction was initially requested. The financial institution and its staff are immune from civil or criminal liability under the bill, absent gross negligence or willful misconduct. The bill is effective July 1.

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March 29, 2019

West Virginia amends provisions related to regulated consumer loans

Buckley Sandler, LLP--Infobytes Blog

On March 26, the West Virginia governor signed HB 3143, which amends the requirements for regulated consumer lending in the state to provide that a person making or taking assignment of consumer loans, or “undertaking direct collection of payments,” must first be licensed by the state’s Commissioner of Banking. Among other things, the act also adjusts the threshold amounts “for which certain finance charges can be imposed” on consumer loans, including revolving loan accounts. For instance, (i) on loans less than $3,500 that are not secured by real property, the finance charge “may not exceed 31 percent per year on the unpaid balance of the principal amount”; and (ii) on loans between $3,500 and $15,000, the finance charge “may not exceed 27 percent per year on the unpaid balance of the principal amount.” The act also provides restrictions relating to when finance charges may be imposed again, and states that, in certain cases, the “financing of [] charges is permissible and does not constitute charging interest on interest.” The act further clarifies that the new licensing provisions exclude “any collection agencies as defined and licensed by the West Virginia Collection Agency Act of 1973.” HB 3143 is effective June 7.

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March 29, 2019

North Dakota expands personal identifying information law

Buckley Sandler, LLP--InfoBytes Blog

On March 20, the North Dakota governor signed SB 2262, which, among other things, amends the state’s law covering the unauthorized use of personal identifying information (PII). Specifically, the bill expands the definition of PII to include, (i) an individual’s payment card information; (ii) an individual’s biometric data; and (iii) any other information that can be used to access a person's financial records. Under the bill, an individual is guilty of an offense if the individual “obtains or attempts to obtain, transfers, records, or uses or attempts to use” any PII of another individual, living or deceased, to obtain anything of value without consent of the other individual. The bill is effective August 1.

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March 28, 2019

Utah Amends Licensing Provisions under RMPLA

Utah Senate Bill 140 amends provisions related to real estate, including

  • defines terms; 
  • amends provisions regarding the Division of Real Estate's issuance of a citation; 
  • establishes criteria and parameters for temporary authorization to act as a mortgage loan originator; 
  • beginning January 1, 2020, requires a background check for certain licenses to include ongoing monitoring through the Federal Bureau of Investigation's Next Generation Identification System's Rap Back Service; 
  • requires the Division of Real Estate to establish a fee for background checks; 
  • permits the Securities Commission to make rules, with the concurrence of the Division of Real Estate, in relation to background checks; 
  • amends the grounds for disciplinary action against a sales agent, principal broker, or association broker;  
  • permits a real estate appraiser to conduct an evaluation; and 
  • makes technical and conforming changes.

Most provisions are effective on May 14, 2019 with the exception of background checks which is effective January 1, 2020.

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March 28, 2019

Utah Modifies Provisions under Consumer Credit Protection Act

Utah Senate Bill 193 amends provisions enforced by the attorney general.  This bill

  • modifies the applicability of the Protection of Personal Information Act;
  • amends the penalty for a violation of the Protection of Personal Information Act or the Consumer Credit Protection Act; 
  • establishes a statute of limitations for an enforcement action under the Protection of 16 Personal Information Act or the Consumer Credit Protection Act; 
  • allows funds in the Attorney General Litigation Fund to be used for education and outreach on certain matters; 
  • modifies the available remedies in an action under the Utah Antitrust Act; and 
  • makes technical and conforming changes.

These provisions are effective on May 14, 2019.

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March 28, 2019

Utah Privacy Law Would Be First to Require Search Warrant for Government to Access Stored Data

Ballard Spahr LLP--This publication was written by members of Ballard Spahr's Privacy and Data Security Group

Utah Governor Gary Herbert is expected to sign a new privacy law in the coming weeks that will make his state the first to protect private electronic data stored with third-party providers from government access without a warrant.

Under the legislation passed unanimously by the Utah Legislature earlier this month, law enforcement agencies need a warrant to obtain information about an individual from wireless communications providers, email platforms, search engine providers, or social media companies.

While much of the focus over the past two years has been on laws to protect consumer privacy rights, protecting private information from disclosure to law enforcement has also generated attention. Traditionally, the general rule followed, on both the federal and state levels, has been that law enforcement agencies can access information through third-party providers because individuals have no reasonable expectation of privacy when they share their personal information with third parties.

The U.S. Supreme Court curbed that traditional rule in last year’s 5-4 opinion in Carpenter v. United States, in which the majority held that the government’s search of personal cell phone location information held by a wireless communications provider constitutes a Fourth Amendment search, and therefore requires a warrant. However, the opinion did not extend beyond location information, and the dissenting justices urged that legislation was needed to govern this body of law in a new age of technology.

Utah’s new law addresses the issue head-on by specifically providing that “a law enforcement agency may not obtain, without a search warrant issued by a court upon probable cause,” the location information from an electronic device or “electronic information or data transmitted by the owner of the electronic information or data to a remote computing service provider.” “Electronic information or data” is defined broadly to include “a sign, signal, writing, image, sound, or intelligence of any nature transmitted or stored in whole or in part by a wire, radio, electromagnetic, photoelectronic, or photooptical system.” In other words, law enforcement agencies cannot obtain information about an individual from third-party service providers without obtaining a warrant. Notably, there are specific exceptions, such as when the third-party provider believes an emergency exists with risk of death, serious physical injury, or sexual abuse.

Assuming Gov. Herbert signs the bill, Utah likely will not be the last state to venture into this area of law. Companies should therefore keep in mind that on top of the growing patchwork of consumer privacy laws and regulations, they may face new laws and regulations that change longstanding practices in how they respond to requests from governmental agencies.

Ballard Spahr's Privacy and Data Security Group provides a full range of counseling, transactional, regulatory compliance, investigative, and litigation services across industry sectors. The Group assists in drafting privacy policies, third-party vendor agreements, and information security policies and procedures.


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March 27, 2019

Utah Amends Provisions Regarding Notaries Public Reform Act

Utah House Bill 52 modifies the Notaries Public Reform Act to allow a notarization to be performed remotely.

These provisions are effective on November 1, 2019.

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March 27, 2019

Virginia Modifies Licensing Provisions Regarding MLOs

Virginia House Bill 2251 

  • repeals provisions relating to the issuance of transitional mortgage loan originator licenses and replaces them with provisions granting temporary authority to act as a mortgage loan originator; 
  • conforms Virginia's law with requirements in the federal Economic Growth, Regulatory Relief, and Consumer Protection Act; and
  • conforms provisions related to the expiration of mortgage loan originator pre-licensure education courses.

These provisions are effective on July 1, 2019.

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March 27, 2019

Kentucky Enacts Provisions Regarding Notaries and County Clerks

Kentucky Senate Bill 114

  • creates new sections of KRS Chapter 423 to define various terms; 
  • limits the applicability of the Act to notarial acts performed on or after January 1, 2020; 
  • allows a notarial officer to perform a notarial act in Kentucky; 
  • outlines requirements for certain notarial acts; 
  • requires a personal or online appearance before a notarial officer; 
  • specifies the requirements of identifying an individual before a notarial officer; 
  • allows a notarial officer to refuse to perform a notarial act; 
  • states who may perform a notarial act in Kentucky; 
  • recognizes notarial acts performed in other states; 
  • recognizes notarial acts performed in federally recognized Indian tribes under federal law, and in foreign countries; 
  • allows a notary public to perform a notarial act by means of communication technology; 
  • requires a notarial act to be evidenced by a certificate; 
  • provides short-form certificates for use by notarial officers; 
  • outlines the requirements for an official stamp of a notary public; 
  • assigns responsibility of the notary public's stamping device to the notary public; 
  • requires a notary public to maintain a journal chronicling all notarial acts performed by that notary public; 
  • requires a notary public to register with the Secretary of State that the notary public will be performing notarial acts with respect to electronic records; 
  • outlines the necessary requirements to be a notary public; 
  • outlines grounds for suspending, denying, or revoking a commission as a notary public; 
  • requires the Secretary of State to maintain an electronic database of notaries public; 
  • details prohibited acts; 
  • establishes the validity of notarial acts; 
  • allows the Secretary of State to promulgate administrative regulations to implement this Act; 
  • requires all commissions occurring after the effective date of this Act to comply with this Act; 
  • states that a portion of this Act may be cited as the Uniform Real Property Electronic Recording Act; 
  • creates a new section of KRS Chapter 382 to state that a paper copy of an electronic record shall satisfy a law requiring a tangible document; 
  • amends KRS 423.200 to make technical corrections; 
  • amends KRS 369.103 to allow electronic signatures on transactions relating to the conveyance of interests in real property and the creation or transfer of negotiable instruments; 
  • amends KRS 382.230 to remove reference to KRS 382.140; 
  • creates a new section of KRS Chapter 382 to provide for the order of priority between physical and electronic documents presented to the county clerk; 
  • amends KRS 382.200 and 382.280 to make technical corrections; 
  • amends KRS 64.012 to update fees of county clerks for recording documents; 
  • amends KRS 382.240 to allow a reimbursement to county clerks for prepayment of postage; 
  • amends KRS 382.360 to no longer require the county clerk to deliver the original deed of release; 
  • creates a task force on issues regarding the implementation of this Act; and
  • repeals KRS 382.140, 382.190, 423.010, 423.020, 423.030, 423.040, 423.050, 423.060, 423.070, 423.080, and 423.990.

These provisions are effective on January 1, 2020.

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March 26, 2019

North Dakota Amends Provisions Regarding Abandoned Property and Foreclosure

North Dakota Senate Bill 2205 amends provisions relating to foreclosure and abandoned property. 

  • Section 28-23-11 The Sheriff's certificate must now include the applicable redemption
    period, where subject to redemption
  • Section 32-19-18 now excludes abandoned property from redemption rights
  • Section 32-19-19 amends the abandoned property statute to include "at the time of the
    commencement of the foreclosure action and at any time before the sheriff's sale" as the eligible time period to petition for abandonment
  • Section 32-19-23 is amended to add "Actual service of the notice before foreclosure is not required if the property is abandoned...or if service by mail as provided in this chapter has been attempted three times and the attempted service is returned as refused or unclaimed"
  • Section 32-19-23.1 is a new section, adding a standard for "Abandoned property - Prima facie evidence" (e.g. Affidavit of Abandonment)
  • Section 32-19-27 amends the proof of service notice affidavit requirements to include "service was attempted and refused or unclaimed, or the property is abandoned"

These provisions are effective on August 1, 2019.

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March 23, 2019

Idaho Modifies Provisions Regarding Revised Uniform Law on Notarial Acts

The state of Idaho modified its provisions relating to its Revised Uniform Law on Notarial Acts that include providing for remotely located individuals and communication technology. These provisions are effective on January 1, 2020.

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March 21, 2019

Montana HB-107 Amends Provisions Regarding Mortgage Act

The state of Montana amended its provisions relating to its Mortgage Act that include, but is not limited to, adding capital requirements for mortgage servicers; adding net worth requirements for mortgage lenders; revising designated manager and branch office requirements; and revising surety bond requirements. These provisions are effective on October 1, 2019.

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March 21, 2019

South Dakota Amends Provisions Regarding Notarial Acts

South Dakota House Bill 1272 provides for remote notarization. 

  • Adds a new section of definition of terms
  • Adds a new section to read that "A notarial officer in this state, while located in this state, may perform by means of communication technology a notarial act executed on a document by a person who appears before, but is not in the physical presence of the notarial officer if the notarial officer..."
  • Amends section § 18-1-3.1 to address requirements for the notarial seal
  • Amends section § 18-1-7 to address restrictions for persons who are  a principal party to the instrument or document
  • Amends section § 18-1-11 Class 2 misdemeanor requirements to include allowances for appearance by communication technology
  • Amends section § 18-1-12.1 Class 1 misdemeanor requirements to include obtaining a commission from the secretary of state
  • Amends section § 18-4-10 to address oath or affirmation requirements

These provisions are effective on July 1, 2019.

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March 15, 2019

North Dakota Modifies Licensing Provisions under Money Brokers Act

Relating to the examination of technology service providers, the capital requirement for trust companies, the examination of trust companies, the definition of a financial institution, surety bond requirements for money brokers and collection agencies, notice requirement for deferred presentment service providers, fees for money transmitters, and reporting requirements for debt-settlement providers; and to repeal sections 13-04.1-05.1, 13- 05-05.2, 13-08-05.2, and 13-09-10.1 of the North Dakota Century Code, relating to automatic renewal of license in 2009 for money brokers, automatic renewal of license in 2014 for collection agencies, deferred presentment service providers, and money transmitters.

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