Below you will find links to the sections of the (The "Act"). Click on a section title to read that particular section.

12-61-901. Short title.

This part 9 shall be known and may be cited as the "Mortgage Broker Registration Act"..

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12-61-902. Definitions. As used in this part 9, unless the context otherwise requires:

Capital letters indicate new material added to existing statutes; dashes through words indicate deletions from existing statutes and such material not part of act.

(1) "Affiliate" means a person who, directly or indirectly, through intermediaries controls, is controlled by, or is under the common control of another person addressed by this part 9.

(1.5) "BORROWER" MEANS ANY PERSON WHO CONSULTS WITH OR RETAINS A MORTGAGE BROKER IN AN EFFORT TO OBTAIN OR SEEK ADVICE OR INFORMATION ON OBTAINING OR APPLYING TO OBTAIN A RESIDENTIAL MORTGAGE LOAN FOR HIMSELF, HERSELF, OR PERSONS INCLUDING HIMSELF OR HERSELF, REGARDLESS OF WHETHER THE PERSON ACTUALLY OBTAINS SUCH A LOAN.

(2) "Broker a mortgage" means to directly or indirectly act as a mortgage broker.

(3) "Director" means the director of the division of real estate.

(4) "Division" means the division of real estate.

(5)"Mortgage broker" means an individual who negotiates, originates, or offers or attempts to negotiate or originate for a borrower, and for a commission or other thing of value, a RESIDENTIAL MORTGAGE loan to be consummated and funded by a mortgage lender.

(6) "Mortgage lender" means a lender who is in the business of making RESIDENTIAL mortgage loans if:
(a) The lender is the payee on the promissory note evidencing the loan; and
(b) The loan proceeds are obtained by the lender from its own funds or from a line of credit made available to the lender from a bank or other entity who regularly loans money to lenders for the purpose of funding mortgage loans..

(7) "Originate" means to submit an application or documentation to a MORTGAGE lender or underwriter in an attempt to obtain a RESIDENTIAL MORTGAGE loan.

(8) "RESIDENTIAL MORTGAGE LOAN" MEANS A LOAN THAT IS PRIMARILY FOR PERSONAL, FAMILY, OR HOUSEHOLD USE AND THAT IS SECURED BY A MORTGAGE OR DEED OF TRUST ON RESIDENTIAL REAL ESTATE UPON WHICH IS CONSTRUCTED OR INTENDED TO BE CONSTRUCTED A SINGLE-FAMILY DWELLING OR MULTIPLE-FAMILY DWELLING OF FOUR OR FEWER UNITS.

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12-61-903. Registration required.

(1) (a) On or after January 1, 2007, unless registered with the director, a person shall not broker a mortgage, offer to broker a mortgage, act as a mortgage broker, or offer to act as a mortgage broker.

b) A registered mortgage broker shall apply for registration in accordance with subsection (2) of this section every three years.

(2) An applicant for registration shall submit to the director the following:

(a) A criminal history background check in compliance with subsection (3) of this section;

(b) A disclosure of all administrative discipline taken against the applicant concerning the categories listed in section 12-61-905 (1) (c); and

(c) The application fee established by the director in accordance with section 12-61-908.

(3) Prior to submitting an application for registration, an applicant shall submit a set of fingerprints to the Colorado bureau of investigation. Upon receipt of the applicant's fingerprints, the Colorado bureau of investigation shall use the fingerprints to conduct a state and national criminal history record check using records of the Colorado bureau of investigation and the federal bureau of investigation. All costs arising from such criminal history record check shall be borne by the applicant and shall be paid when the set of fingerprints is submitted. Upon completion of the criminal history record check, the bureau shall forward the results to the director.

(4) Before registering an applicant, the director shall require the applicant to post a bond as required by section 12-61-907.

(5) The director shall issue or deny a registration within twenty-one days after receiving the completed criminal history record check, completed application, application fee, and proof of the posting of the surety bond.

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12-61-904. Exemptions.

(1) EXCEPT AS OTHERWISE PROVIDED IN SECTION 12-61-911, this part 9 shall not apply to the following:

(a) Employees of an agency of the federal government, of the Colorado government, or of any of Colorado's political subdivisions;

(b) An owner of real property who offers credit secured by a mortgage or deed of trust on the property sold;

(c) A bank, savings bank, savings and loan association, building and loan association, industrial bank, industrial loan company, credit union, or bank or savings association holding company organized under the laws of any state, the District of Columbia, a territory or protectorate of the United States, or the United States, subject to regulation and supervision by a federal banking agency, or an operating subsidiary or affiliate of such entities, or an employee or exclusive agent of any of such entities, including, without limitation, a subsidiary or affiliate of such entities;

(d) An attorney who renders services in the course of practice, who is licensed in Colorado, and who is not primarily engaged in the business of negotiating residential mortgage loans;

(e) A federal housing administration approved mortgagee or an appointed federal housing administration correspondent, acting through officers, partners, members, exclusive agents, contractors, or employees of such entities when making or brokering any mortgage loan; or

(f) A person who:

(I) Funds a residential mortgage loan that has been originated and processed by a registered person or by an exempt person;

(II) Does not solicit borrowers in Colorado for the purpose of making residential mortgage loans; and

(III) Does not participate in the negotiation of residential mortgage loans with the borrower, except for setting the terms under which a person may buy or fund a residential mortgage loan originated by a registered or exempt person.

(2) The exemptions in subsection (1) of this section shall not apply to persons acting beyond the scope of such exemptions.

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12-61-904.5. Broker's relationship to borrower - rules.

(1) A MORTGAGE BROKER SHALL HAVE A DUTY OF GOOD FAITH AND FAIR DEALING IN ALL COMMUNICATIONS AND TRANSACTIONS WITH A BORROWER. SUCH DUTY INCLUDES, BUT IS NOT LIMITED TO:

(a) THE DUTY TO NOT RECOMMEND OR INDUCE THE BORROWER TO ENTER INTO A TRANSACTION THAT DOES NOT HAVE A REASONABLE, TANGIBLE NET BENEFIT TO THE BORROWER, CONSIDERING ALL OF THE CIRCUMSTANCES, INCLUDING THE TERMS OF A LOAN, THE COST OF A LOAN, AND THE BORROWER'S CIRCUMSTANCES;

(b) THE DUTY TO MAKE A REASONABLE INQUIRY CONCERNING THE BORROWER'S CURRENT AND PROSPECTIVE INCOME, EXISTING DEBTS AND OTHER OBLIGATIONS, AND ANY OTHER INFORMATION KNOWN TO THE MORTGAGE BROKER AND, AFTER MAKING SUCH INQUIRY, TO MAKE HIS OR HER BEST EFFORTS TO RECOMMEND, BROKER, OR ORIGINATE A RESIDENTIAL MORTGAGE LOAN THAT TAKES INTO CONSIDERATION THE INFORMATION SUBMITTED BY THE BORROWER; AND

(c) THE DUTY NOT TO COMMIT ANY UNCONSCIONABLE ACT OR PRACTICE LISTED IN SECTION 38-40-105 (1.7), C.R.S.

(2) FOR PURPOSES OF IMPLEMENTING SUBSECTION

(1) OF THIS SECTION, THE DIRECTOR MAY ADOPT RULES DEFINING WHAT CONSTITUTES A REASONABLE, TANGIBLE NET BENEFIT TO THE BORROWER.

(3) A VIOLATION OF THIS SECTION CONSTITUTES A DECEPTIVE TRADE PRACTICE UNDER THE "COLORADO CONSUMER PROTECTION ACT", ARTICLE 1 OF TITLE 6, C.R.S.

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12-61-905. Powers and duties of the division.

(1) The director shall deny, refuse to renew, or revoke the registration of an applicant who has:(a) Filed an application with the director containing material misstatements of fact or omitted any disclosure required by this part 9;

(b) Within the last five years, been convicted of or pled guilty or nolo contendere to a crime involving fraud, deceit, material misrepresentation, theft, or the breach of a fiduciary duty; or

(c) WITHIN THE LAST FIVE YEARS, had a license, registration, or certification issued by Colorado or another state revoked or suspended for fraud, deceit, material misrepresentation, theft, or the breach of a fiduciary duty, and such discipline denied the person authorization to practice as:

(d) BEEN ENJOINED WITHIN THE IMMEDIATELY PRECEDING FIVE YEARS UNDER THE LAWS OF THIS OR ANY OTHER STATE OR OF THE UNITED STATES FROM ENGAGING IN DECEPTIVE CONDUCT RELATING TO THE BROKERING OF A MORTGAGE LOAN;

(f) BEEN FOUND TO HAVE VIOLATED THE PROVISIONS OF SECTION 12-61-911.

(I) A mortgage broker;

(II) A real estate broker, as defined by section 12-61-101 (2);

(III) A real estate salesperson, as defined by section 12-61-101 (3);

(IV) A real estate appraiser, as defined by section 12-61-702 (5);

(V) An insurance producer, as defined by section 10-2-103 (6), C.R.S.;

(VI) An attorney;

(VII) A securities broker-dealer, as defined by section 11-51-201 (2), C.R.S.;
(VIII) A securities sales representative, as defined by section 11-51-201 (14), C.R.S.;

(IX) An investment advisor, as defined by section 11-51-201 (9.5), C.R.S.; or

(X) An investment advisor representative, as defined by section 11-51-201 (9.6), C.R.S.

(2) The director may investigate the activities of a registrant or other person that present grounds for disciplinary action under this part 9 or that violate section 12-61-910 (1).

(3) (a) If the director has reasonable grounds to believe that a mortgage broker is no longer qualified under subsection (1) of this section, the director may summarily suspend the mortgage broker's registration pending a hearing to revoke the registration. A summary suspension shall conform to article 4 of title 24, C.R.S.

(b) The director shall suspend the registration of a broker who fails to maintain the bond required by section 12-61-907 until the registrant complies with such section.

(4) The director or an administrative law judge appointed pursuant to part 10 of article 30 of title 24, C.R.S., shall conduct disciplinary hearings concerning mortgage brokers. Such hearings shall conform to article 4 of title 24, C.R.S..

(5) (a) Except as provided in paragraph (b) of this subsection (5), a person whose registration has been revoked shall not be eligible for registration for two years after the effective date of the revocation.

(b) If the director or an administrative law judge determines that an application contained a misstatement of fact or omitted a required disclosure due to an unintentional error, the director shall allow the applicant to correct the application. Upon receipt of the corrected and completed application, the director or administrative law judge shall not bar the applicant from being registered on the basis of the unintentional misstatement or omission.

(6) (a) The director or an administrative law judge may administer oaths, take affirmations of witnesses, and issue subpoenas to compel the attendance of witnesses and the production of all relevant papers, books, records, documentary evidence, and materials in any hearing or investigation conducted by the director or an administrative law judge.

(b) Upon failure of a witness to comply with a subpoena or process, the district court of the county in which the subpoenaed witness resides or conducts business may issue an order requiring the witness to appear before the director or administrative law judge and produce the relevant papers, books, records, documentary evidence, testimony, or materials in question. Failure to obey the order of the court may be punished as a contempt of court. The director or an administrative law judge may apply for such order.

(7) (a)If the director has reasonable cause to believe that a person is violating this part 9, including but not limited to section 12-61-910 (1), the director may enter an order requiring such person to cease and desist such violations.

(b) THE DIRECTOR, UPON HIS OR HER OWN MOTION MAY, AND, UPON THE COMPLAINT IN WRITING OF ANY PERSON, SHALL, INVESTIGATE THE ACTIVITIES OF ANY REGISTRANT OR LICENSEE OR ANY PERSON WHO ASSUMES TO ACT IN SUCH CAPACITY WITHIN THE STATE. IN ADDITION TO ANY OTHER PENALTY WHICH MAY BE IMPOSED PURSUANT TO THIS PART 9, ANY PERSON VIOLATING ANY PROVISION OF THIS PART 9 OR ANY RULES PROMULGATED PURSUANT TO THIS ARTICLE MAY BE FINED UPON A FINDING OF MISCONDUCT BY THE DIRECTOR AS FOLLOWS:

(I) IN THE FIRST ADMINISTRATIVE PROCEEDING, A FINE NOT IN EXCESS OF ONE THOUSAND DOLLARS PER ACT OR OCCURRENCE;

(II) IN ANY SUBSEQUENT ADMINISTRATIVE PROCEEDING, A FINE NOT LESS THAN ONE THOUSAND DOLLARS NOR IN EXCESS OF TWO THOUSAND DOLLARS PER ACT OR OCCURRENCE.

(c) ALL FINES COLLECTED PURSUANT TO THIS SUBSECTION (7) SHALL BE TRANSFERRED TO THE STATE TREASURER, WHO SHALL CREDIT SUCH MONEYS TO THE MORTGAGE BROKER LICENSING CASH FUND CREATED IN SECTION 12-61-908.

(8) The director shall keep records of the persons registered as mortgage brokers and of disciplinary proceedings. The records kept by the director shall be open to public inspection in a reasonable time and manner determined by the director.

(9) (a) The director shall maintain a system, which may include, without limitation, a hotline or web site, that gives consumers a reasonably easy method for making complaints about a mortgage broker.

(b) The director shall review the complaints annually and prepare a report to be issued to the committee of the general assembly that has oversight of mortgage brokers. Such report shall contain the trends in complaints and investigations under this part 9.

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12-61-906. Immunity.

A person participating in good faith in the filing of a complaint or report or participating in an investigation or hearing before the director or an administrative law judge pursuant to this part 9 shall be immune from any liability, civil or criminal, that otherwise might result by reason of such action.

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12-61-907. Bond required.

(1) Prior to registration, an applicant for registration shall post with the director a surety bond, or an alternative authorized by article 35 of title 11, C.R.S., of twenty-five thousand dollars. A registered mortgage broker shall maintain such bond at all times.

(2) The surety shall not be required to pay a person making a claim upon the bond until a final determination of fraud, forgery, criminal impersonation, or fraudulent representation has been made by a court with jurisdiction.

(3) The surety bond shall require the surety to provide notice to the director within thirty days if payment is made from the surety bond or if the bond is cancelled.

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12-61-908. Fees.

(1) The director may set the fee for registration under this part 9. The fee shall be set in an amount, not to exceed two hundred dollars, that offsets the direct and indirect costs of implementing this part 9. The moneys collected pursuant to this section shall be transferred to the state treasurer, who shall credit them to the mortgage broker registration cash fund

(2) There is hereby created in the state treasury the mortgage broker registration cash fund. Moneys in the fund shall be spent only to implement this part 9 and shall not revert to the general fund at the end of the fiscal year. The fund shall be subject to annual appropriation by the general assembly.

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12-61-909. Attorney general - district attorney - jurisdiction.

The attorney general shall have concurrent jurisdiction with the district attorneys of this state to investigate and prosecute allegations of criminal violations of this part 9.

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12-61-910. Violations - injunctions.

(1) (a) Brokering a mortgage or practicing as a mortgage broker without registering under this part 9 shall be a class 1 misdemeanor and shall be punished as provided in section 18-1.3-501, C.R.S.

(b) Each mortgage brokered by an unregistered person shall be a separate violation of this subsection (1).

(2) The director may forward information concerning possible violations of the law committed by or complaints filed against a mortgage broker to the attorney general, a district attorney, or a state or federal law enforcement agency.

(3) The director may request that an action be brought in the name of the people of the state of Colorado by the attorney general or the district attorney of the district in which the violation is alleged to have occurred to enjoin a person from engaging in or continuing the violation or from doing any act that furthers the violation. In such an action, an order or judgment may be entered awarding such preliminary or final injunction as is deemed proper by the court. The notice, hearing, or duration of an injunction or restraining order shall be made in accordance with the Colorado rules of civil procedure.

(4) A violation of this part 9 shall not affect the validity or enforceability of any mortgage.

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12-61-910.3. Rule-making authority.

THE DIRECTOR SHALL HAVE AUTHORITY TO PROMULGATE RULES AS NECESSARY TO ENABLE THE DIRECTOR TO CARRY OUT THE DIRECTOR'S DUTIES UNDER THIS PART 9.

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12-61-911. Prohibited conduct - fraud - misrepresentation conflict of interest - rules.

(1) A MORTGAGE BROKER, INCLUDING A MORTGAGE BROKER OTHERWISE EXEMPTED FROM THIS PART 9 BY SECTION 12-61-904 (1) (b) OR (1) (c), SHALL NOT:

(a) DIRECTLY OR INDIRECTLY EMPLOY ANY SCHEME, DEVICE, OR ARTIFICE TO DEFRAUD OR MISLEAD BORROWERS OR LENDERS OR TO DEFRAUD ANY PERSON;

(b) ENGAGE IN ANY UNFAIR OR DECEPTIVE PRACTICE TOWARD ANY PERSON; (c) OBTAIN PROPERTY BY FRAUD OR MISREPRESENTATION;

(d) SOLICIT OR ENTER INTO A CONTRACT WITH A BORROWER THAT PROVIDES IN SUBSTANCE THAT THE MORTGAGE BROKER MAY EARN A FEE OR COMMISSION THROUGH THE MORTGAGE BROKER'S "BEST EFFORTS" TO OBTAIN A LOAN EVEN THOUGH NO LOAN IS ACTUALLY OBTAINED FOR THE BORROWER;

(e) 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 FROM A LENDER WITH WHOM THE MORTGAGE BROKER MAINTAINS A WRITTEN CORRESPONDENT OR LOAN BROKER AGREEMENT UNDER SECTION 12-61-913;

(f) FAIL TO MAKE A DISCLOSURE TO A LOAN APPLICANT OR A NONINSTITUTIONAL INVESTOR AS REQUIRED BY SECTION 12-61-914 AND ANY OTHER APPLICABLE STATE OR FEDERAL LAW;

(g) 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;

(h) NEGLIGENTLY MAKE ANY FALSE STATEMENT OR KNOWINGLY AND WILLFULLY MAKE ANY OMISSION OF MATERIAL FACT IN CONNECTION WITH ANY REPORTS FILED BY A MORTGAGE BROKER OR IN CONNECTION WITH ANY INVESTIGATION CONDUCTED BY THE DIVISION;

(i) ADVERTISE ANY RATE OF INTEREST WITHOUT CONSPICUOUSLY DISCLOSING THE ANNUAL PERCENTAGE RATE IMPLIED BY SUCH RATE OF INTEREST;

(j) FAIL TO COMPLY WITH ANY REQUIREMENT OF THE FEDERAL "TRUTH IN LENDING ACT", 15 U.S.C. SEC. 1601 AND REGULATION Z, 12 CFR 226; THE "REAL ESTATE SETTLEMENT PROCEDURES ACT OF 1974", 12 U.S.C. SEC. 2601 AND REGULATION X, 24 CFR 3500; THE "EQUAL CREDIT OPPORTUNITY ACT", 15 U.S.C. SEC. 1691 AND REGULATION B, CFR 202.9, 202.11, AND 202.12; TITLE V, SUBTITLE A OF THE FINANCIAL MODERNIZATION ACT OF 1999 (KNOWN AS THE "GRAMM-LEACH-BLILEY ACT"), 12 U.S.C. SECS. 6801-6809; THE FEDERAL TRADE COMMISSION'S PRIVACY RULES, 16 CFR 313-314, MANDATED BY THE "GRAMM-LEACH-BLILEY ACT"; THE "HOME MORTGAGE DISCLOSURE ACT OF 1975", 12 U.S.C. SEC. 2801 ET SEQ. AND REGULATION C, HOME MORTGAGE DISCLOSURE; THE "FEDERAL TRADE COMMISSION ACT",12CFR 203, 15 U.S.C. SEC. 45(a); THE "TELEMARKETING AND CONSUMER FRAUD AND ABUSE PREVENTION ACT", 15 U.S.C. SECS. 6101 TO 6108; AND THE FEDERAL TRADE COMMISSION TELEPHONE SALES RULE, 16 CFR 310, AS AMENDED, IN ANY ADVERTISING OF RESIDENTIAL MORTGAGE LOANS OR ANY OTHER APPLICABLE MORTGAGE BROKER ACTIVITIES COVERED BY THE ACTS. THE DIRECTOR MAY ADOPT RULES REQUIRING MORTGAGE BROKERS TO COMPLY WITH OTHER APPLICABLE FEDERAL STATUTES AND REGULATIONS IN ANY ADVERTISING OF RESIDENTIAL MORTGAGE LOANS, OR ANY OTHER MORTGAGE BROKER ACTIVITY.

(k) FAIL TO PAY A THIRD-PARTY PROVIDER, NO LATER THAN THIRTY DAYS AFTER THE RECORDING OF THE LOAN CLOSING DOCUMENTS OR NINETY DAYS AFTER COMPLETION OF THE THIRD-PARTY SERVICE, WHICHEVER COMES FIRST, UNLESS OTHERWISE AGREED OR UNLESS THE THIRD-PARTY SERVICE PROVIDER HAS BEEN NOTIFIED IN WRITING THAT A BONA FIDE DISPUTE EXISTS REGARDING THE PERFORMANCE OR QUALITY OF THE THIRD-PARTY SERVICE;

(l) COLLECT, CHARGE, ATTEMPT TO COLLECT OR CHARGE, OR USE OR PROPOSE ANY AGREEMENT PURPORTING TO COLLECT OR CHARGE ANY FEE PROHIBITED BY SECTION 12-61-914 OR 12-61-915; OR

(m) FAIL TO COMPLY WITH ANY PROVISION OF THIS PART 9 OR ANY RULE ADOPTED PURSUANT TO THIS PART 9.

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(2) BEFORE PROVIDING MORTGAGE SERVICES TO THE BORROWER, A MORTGAGE BROKER SHALL MAKE A FULL AND FAIR DISCLOSURE TO THE BORROWER, IN ADDITION TO ANY OTHER DISCLOSURES REQUIRED BY THIS PART 9 OR OTHER LAWS, OF ALL MATERIAL FEATURES OF THE LOAN PRODUCT AND ALL FACTS MATERIAL TO THE TRANSACTION.

(3) (a) A REAL ESTATE BROKER OR SALESPERSON LICENSED UNDER PART 1 OF THIS ARTICLE WHO ALSO ACTS AS A MORTGAGE BROKER SHALL CARRY ON SUCH MORTGAGE BROKER BUSINESS ACTIVITIES AND SHALL MAINTAIN SUCH PERSON'S MORTGAGE BROKER BUSINESS RECORDS SEPARATE AND APART FROM THE REAL ESTATE BROKER ACTIVITIES CONDUCTED PURSUANT TO PART 1 OF THIS ARTICLE. SUCH ACTIVITIES SHALL BE DEEMED SEPARATE AND APART EVEN IF THEY ARE CONDUCTED AT AN OFFICE LOCATION WITH A COMMON ENTRANCE AND MAILING ADDRESS IF:

(I) EACH BUSINESS IS CLEARLY IDENTIFIED BY A SIGN VISIBLE TO THE PUBLIC;

(II) EACH BUSINESS IS PHYSICALLY SEPARATED WITHIN THE OFFICE FACILITY; AND

(III) NO DECEPTION OF THE PUBLIC AS TO THE SEPARATE IDENTITIES OF THE BROKER BUSINESS FIRMS RESULTS.

(b) THIS SUBSECTION (3) SHALL NOT REQUIRE A REAL ESTATE BROKER OR SALESPERSON LICENSED UNDER PART 1 OF THIS ARTICLE WHO ALSO ACTS AS A MORTGAGE BROKER TO MAINTAIN A PHYSICAL SEPARATION WITHIN THE OFFICE FACILITY FOR THE CONDUCT OF ITS REAL ESTATE AND MORTGAGE BROKER ACTIVITIES IF THE DIRECTOR DETERMINES THAT MAINTAINING SUCH PHYSICAL SEPARATION WOULD CONSTITUTE AN UNDUE FINANCIAL HARDSHIP UPON THE MORTGAGE BROKER AND IS UNNECESSARY FOR THE PROTECTION OF THE PUBLIC.

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12-61-913. Written contract required - effect.


(1) EVERY CONTRACT BETWEEN A MORTGAGE BROKER AND A BORROWER SHALL BE IN WRITING AND SHALL CONTAIN THE ENTIRE AGREEMENT OF THE PARTIES.

(2) A MORTGAGE BROKER SHALL HAVE A WRITTEN CORRESPONDENT OR LOAN BROKER AGREEMENT WITH A LENDER BEFORE ANY SOLICITATION OF, OR CONTRACTING WITH, ANY MEMBER OF THE PUBLIC.

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12-61-914. Written disclosure of fees and costs - contents - limits on fees - lock-in agreement terms - rules.

(1) WITHIN THREE BUSINESS DAYS AFTER RECEIPT OF A LOAN APPLICATION OR ANY MONEYS FROM A BORROWER, A MORTGAGE BROKER SHALL PROVIDE TO EACH BORROWER A FULL WRITTEN DISCLOSURE CONTAINING AN ITEMIZATION AND EXPLANATION OF ALL FEES AND COSTS THAT THE BORROWER IS REQUIRED TO PAY IN CONNECTION WITH OBTAINING A RESIDENTIAL MORTGAGE LOAN, AND SPECIFYING THE FEE OR FEES THAT INURE TO THE BENEFIT OF THE MORTGAGE BROKER. A GOOD-FAITH ESTIMATE OF A FEE OR COST SHALL BE PROVIDED IF THE EXACT AMOUNT OF THE FEE OR COST IS NOT DETERMINABLE. EXCEPT AS REQUIRED BY PARAGRAPH (c) OF SUBSECTION (2) OF THIS SECTION, THIS SUBSECTION (1) SHALL NOT BE CONSTRUED TO REQUIRE DISCLOSURE OF THE DISTRIBUTION OR BREAKDOWN OF LOAN FEES, DISCOUNTS, OR POINTS BETWEEN THE MORTGAGE BROKER AND ANY LENDER OR INVESTOR.

(2) THE WRITTEN DISCLOSURE SHALL CONTAIN THE FOLLOWING INFORMATION:

(a) THE ANNUAL PERCENTAGE RATE, FINANCE CHARGE, AMOUNT FINANCED, TOTAL AMOUNT OF ALL PAYMENTS, NUMBER OF PAYMENTS, AMOUNT OF EACH PAYMENT, AMOUNT OF POINTS OR PREPAID INTEREST, AND THE CONDITIONS AND TERMS UNDER WHICH ANY LOAN TERMS MAY CHANGE BETWEEN THE TIME OF DISCLOSURE AND CLOSING OF THE LOAN. IF THE INTEREST RATE IS VARIABLE, THE WRITTEN DISCLOSURE SHALL CLEARLY DESCRIBE THE CIRCUMSTANCES UNDER WHICH THE RATE MAY INCREASE, ANY LIMITATION ON THE INCREASE, THE EFFECT OF AN INCREASE, AND AN EXAMPLE OF THE PAYMENT TERMS RESULTING FROM AN INCREASE.

(b) THE ITEMIZED COSTS OF ANY CREDIT REPORT, APPRAISAL, TITLE REPORT, TITLE INSURANCE POLICY, MORTGAGE INSURANCE, ESCROW FEE, PROPERTY TAX, INSURANCE, STRUCTURAL OR PEST INSPECTION, AND ANY OTHER THIRD-PARTY PROVIDER'S COSTS ASSOCIATED WITH THE RESIDENTIAL MORTGAGE LOAN;

(c) IF APPLICABLE, THE AMOUNT OF ANY COMMISSION OR OTHER COMPENSATION TO BE PAID TO THE MORTGAGE BROKER, INCLUDING THE MANNER IN WHICH SUCH COMMISSION OR OTHER COMPENSATION IS CALCULATED AND THE RELATIONSHIP OF SUCH COMMISSION OR OTHER COMPENSATION TO THE COST OF THE LOAN RECEIVED BY THE BORROWER;

(d) IF APPLICABLE, THE COST, TERMS, DURATION, AND CONDITIONS OF A LOCK-IN AGREEMENT AND WHETHER A LOCK-IN AGREEMENT HAS BEEN ENTERED, WHETHER THE LOCK-IN AGREEMENT IS GUARANTEED BY THE MORTGAGE BROKER OR LENDER, AND, IF A LOCK-IN AGREEMENT HAS NOT BEEN ENTERED, DISCLOSURE IN A FORM ACCEPTABLE TO THE DIRECTOR THAT THE DISCLOSED INTEREST RATE AND TERMS ARE SUBJECT TO CHANGE;

(e) A STATEMENT THAT IF THE BORROWER IS UNABLE TO OBTAIN A LOAN FOR ANY REASON, THE MORTGAGE BROKER MUST, WITHIN FIVE DAYS AFTER A WRITTEN REQUEST BY THE BORROWER, GIVE COPIES OF EACH APPRAISAL, TITLE REPORT, AND CREDIT REPORT PAID FOR BY THE BORROWER TO THE BORROWER, AND TRANSMIT THE APPRAISAL, TITLE REPORT, OR CREDIT REPORT TO ANY OTHER MORTGAGE BROKER OR LENDER TO WHOM THE BORROWER DIRECTS THE DOCUMENTS TO BE SENT;

(f) WHETHER AND UNDER WHAT CONDITIONS ANY LOCK-IN FEES ARE REFUNDABLE TO THE BORROWER; AND

(g) A STATEMENT PROVIDING THAT MONEYS PAID BY THE BORROWER TO THE MORTGAGE BROKER FOR THIRD-PARTY PROVIDER SERVICES ARE HELD IN A TRUST ACCOUNT AND ANY MONEYS REMAINING AFTER PAYMENT TO THIRD-PARTY PROVIDERS WILL BE REFUNDED.

(3) IF, AFTER THE WRITTEN DISCLOSURE IS PROVIDED UNDER THIS SECTION, A MORTGAGE BROKER ENTERS INTO A LOCK-IN AGREEMENT WITH A BORROWER OR REPRESENTS TO THE BORROWER THAT THE BORROWER HAS ENTERED INTO A LOCK-IN AGREEMENT, THEN NO LESS THAN THREE BUSINESS DAYS THEREAFTER, INCLUDING SATURDAYS, THE MORTGAGE BROKER SHALL DELIVER OR SEND BY FIRST-CLASS MAIL TO THE BORROWER A WRITTEN CONFIRMATION OF THE TERMS OF THE LOCK-IN AGREEMENT, WHICH SHALL INCLUDE A COPY OF THE DISCLOSURE MADE UNDER PARAGRAPH (d) OF SUBSECTION (2) OF THIS SECTION.

(4) (a) EXCEPT AS OTHERWISE PROVIDED IN PARAGRAPH (b) OF THIS SUBSECTION (4), A MORTGAGE BROKER SHALL NOT CHARGE ANY FEE THAT INURES TO THE BENEFIT OF THE MORTGAGE BROKER AND THAT EXCEEDS THE FEE DISCLOSED ON THE WRITTEN DISCLOSURE PURSUANT TO THIS SECTION UNLESS:

(I) THE NEED TO CHARGE THE FEE WAS NOT REASONABLY FORESEEABLE AT THE TIME THE WRITTEN DISCLOSURE WAS PROVIDED; AND

(II) THE MORTGAGE BROKER HAS PROVIDED TO THE BORROWER, NO LESS THAN THREE BUSINESS DAYS PRIOR TO THE SIGNING OF THE LOAN CLOSING DOCUMENTS, A CLEAR WRITTEN EXPLANATION OF THE FEE AND THE REASON FOR CHARGING A FEE EXCEEDING THAT WHICH WAS PREVIOUSLY DISCLOSED.

(b) IF THE BORROWER'S CLOSING COSTS ON THE FINAL SETTLEMENT STATEMENT, EXCLUDING PREPAID ESCROWED COSTS OF OWNERSHIP AS DEFINED BY THE DIRECTOR BY RULE, DO NOT EXCEED THE TOTAL CLOSING COSTS IN THE MOST RECENT GOOD-FAITH ESTIMATE, EXCLUDING PREPAID ESCROWED COSTS OF OWNERSHIP, NO OTHER DISCLOSURES SHALL BE REQUIRED BY THIS SUBSECTION (4).

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11-35-101. Alternatives to surety bonds permitted requirements.

(1) The requirement of a surety bond as a condition to
licensure or authority to conduct business or perform duties in this state
provided in sections 12-5.5-202 (2) (b), 12-6-111, 12-6-112, 12-6-112.2,
12-11-101 (1) (d), 12-11-104, 12-11-106, 12-14-124 (1), 12-59-115 (1),
12-60-509 (2.5) (b), 33-4-101 (1), 12-60-509(2.5) (b), 12-61-907,33-4-101
(1), 33-12-104 (1), 35-33-403 (3), 35-55-104 (1), 37-91-107 (2) and (3),
38-29-119 (2), 39-21-105 (4), 39-27-104 (2) (a), (2) (b), (2) (c), (2) (d), (2)
(e), (2.1) (a), (2.1) (b), (2.1) (c), (2.5) (a), and (2.5) (b), 39-28-105 (1),
42-6-115 (3), and 42-7-301 (6), C.R.S., may be satisfied by a savings
account or deposit in or a certificate of deposit issued by a state or national
bank doing business in this state or by a savings account or deposit in or a
certificate of deposit issued by a state or federal savings and loan
association doing business in this state. Such savings account, deposit, or
certificate of deposit shall be in the amount specified by statute, if any, and
shall be assigned to the appropriate state agency for the use of the people of
the state of Colorado. The aggregate liability of the bank or savings and
loan association shall in no event exceed the amount of the deposit. For the
purposes of the sections referred to in this section, "bond" includes the
savings account, deposit, or certificate of deposit authorized by this section.

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