2017 - Senate Bill 20 - MC Provisions
Earlier this year, the Kansas Legislature passed, and the governor signed into law, legislation to update the Kansas Mortgage Business Act (KMBA) (K.S.A. 9-2201 et seq.). The bill, SB 20, takes effect July 1, 2017. Among other provisions, SB 20 updates mortgage laws in Kansas applicable to all current and future MC licensees.
The full text of SB 20 is available at the below link. Please note that Sec. 8 through Sec. 12 contain the provisions applicable to the KMBA.Download Full Text of SB 20 Here
SB 20 makes the following changes to the KMBA. Changes to existing law are in italics:
K.S.A. 2016 Supp. 9-2203 (d)
Mortgage Licensing- Clarifies that no other state license is required to conduct non-depository mortgage business.
"Nothing under this act shall require a licensee to obtain any other license under any other act for the sole purpose of conducting non-depository mortgage business."
K.S.A. 2016 Supp. 9-2204 (5)(d)
Mortgage Applications- Adds a provision that permits the commissioner to deem abandoned an application that is not complete within 60 days after the commissioner provides written notice to the applicant that the application is incomplete. Written notice will be provided to the applicant through the NMLS, as well as through a letter mailed using the contact information/address provided on the application.
"The commissioner shall consider an application for a license or registration abandoned if the applicant fails to complete the application within 60 days after the commissioner provides the applicant with written notice of the incomplete application. An applicant whose application is abandoned under this section may reapply to obtain a license or registration and shall pay the fee set forth in subsection (c) upon such application."
K.S.A. 2016 Supp. 9-2206 (b)
Mortgage Applications- Affords the applicant an opportunity for a hearing if an application is deemed abandoned.
"If an application is considered abandoned pursuant to K.S.A. 9-2204, and amendments thereto, an applicant may make written request for a hearing. The commissioner shall conduct a hearing in accordance with the Kansas administrative procedure act."
K.S.A. 2016 Supp. 9-2211 (b)(2)
Financial Requirements- Allows an applicant to employ an alternative accounting system to reflect net worth while requiring the applicant to demonstrate the method meets or exceeds GAAP. Net worth only applies to applicants not claiming a Kansas bona fide office.
"Submit evidence that establishes, to the commissioner's satisfaction, that the applicant or licensee shall at all times maintain a minimum net worth of $50,000. Evidence of net worth shall include the submission of a balance sheet of the applicant or a consolidated financial statement of the entity that owns or controls the applicant accompanied by a written statement by an independent certified public accountant attesting that the balance sheet or the consolidated financial statement has been reviewed in accordance with generally accepted accounting principles. Should the applicant or licensee choose a different accounting system other than generally accepted accounting principles, the burden to demonstrate that the accounting principles meet or exceed the generally accepted accounting principles shall be on the applicant or licensee using the alternate accounting principle method."
Should you have any questions pertaining to the contents of this communication, please contact Jim Payne, Director of Licensing at (785) 296-1877 or email@example.com.
Please note this should not be construed as legal advice or the creation of an attorney-client relationship. For legal advice regarding the application of Kansas or federal law to your situations, please consult with your own counsel.