HB 1322, Measures to Prevent Mortgage Fraud (Marshall/Groff)
Brokers must act for the benefit of the borrower, including making reasonable inquiry into the borrower’s financial situation and using best efforts to obtain a loan that takes into consideration the borrower’s situation.
SB 85, Protect Consumer Real Estate Transactions (Veiga/Massey)
Brokers are prohibited from trying to influence the judgment of a real estate appraiser through coercion, intimidation, or compensation.
SB 203, Mortgage Broker Licensing (Groff/Marshall)
The bill creates the “Mortgage Broker Licensing Act.” Brokers must now be licensed by the Division of Real Estate; must get adequate training, testing, and receive continuing professional education; and are now prohibited from engaging in 24 specific activities (misrepresentation, fraud, conflicts of interest, and obligations to the consumer). A broker who has had his license revoked for violating this legislation would not be eligible to get re-instated unless he provides full restitution to those individuals he has harmed.
SB 216, Mortgage Loan Acts Practices (Veiga/Marshall)
Imposes on a mortgage broker a statutory duty of good faith and fair dealing toward a borrower. These duties include:
* Not to recommend the borrower to enter into a transaction “that does not have a reasonable, tangible net benefit to the borrower” considering his circumstances.
* To make reasonable inquiry into the borrower’s financial circumstances and use best efforts to obtain a mortgage loan taking those circumstances into account.
* Not to engage in a pattern or practice of providing mortgage loans based on acquiring the foreclosure or liquidation value of the collateral without regard to ability to repay, or entering into a loan transaction knowing there was no reasonable probability of repayment by the borrower.
Violation of this duty of good faith and fair dealing is made a deceptive trade practice under the Colorado Consumer Protection Act.
SB 249, Real Estate Title Escrow Settlement (Veiga/Rice)
Directs the Division of Insurance to provide annual reports to the JBC and other specified legislative committees, and to post on the DOI website, a statistical report of the number of enforcement actions taken, the market trends associated with title insurance and real estate transactions, and consumer complaints generated by market analysis, investigation and enforcement efforts regarding title insurance.