Mortgage lenders and brokers regulated.
Terms used in this Act mean:
Any applicant for licensure or registration shall submit to the director an application
on forms prescribed by the division. The forms shall include, at a minimum, all addresses at which
business is to be conducted, the names and titles of each director and principal officer of the
business, and a description of the business activities and experience of the applicant.
Each applicant for licensure and registration under this Act shall submit to a state
and federal criminal background investigation by means of fingerprint checks by the Division of
Criminal Investigation and the Federal Bureau of Investigation. Upon application, the Division of
Banking shall submit completed fingerprint cards to the Division of Criminal Investigation. Upon
completion of the criminal background check, the Division of Criminal Investigation shall forward
to the Division of Banking all information obtained as a result of the criminal background check.
The Division of Banking may require a state and federal criminal background check for any
licensee who is the subject of a disciplinary investigation by the division. Failure to submit or
cooperate with the criminal background investigation is grounds for denial of an application or
may result in revocation of a license. The applicant shall pay for any fees charged for the cost of
fingerprinting or the criminal background investigation. Any applicant who has previously
completed a background check in another jurisdiction in anticipation of receiving a license or
registration in that jurisdiction may have the results of such a background check forwarded to the
division in satisfaction of this requirement. However, no background check in another jurisdiction
may be used if it was completed more than one year prior to application.
The applicant for an initial license shall submit a fee in the amount of not more than
five hundred dollars for a mortgage broker license, and not more than one thousand dollars for a
mortgage lender license. The applicant for initial registration shall submit a fee in the amount of
not more than two hundred fifty dollars for mortgage loan originator registration. The director shall
establish the fees by rules promulgated pursuant to chapter 1-26.
No license or registration granted pursuant to this Act is assignable.
Any license or registration granted under this Act expires on the following
December thirty-first after its issuance.
Any application for renewal of a license or registration under this Act must be
postmarked to the director by December first and shall be accompanied by a fee to be established
by the director by rules promulgated pursuant to chapter 1-26. Any license granted by the division
prior to the implementation of this Act is valid until December 31, 2007. However, no mortgage
loan originator is required to be licensed prior to December 31, 2007. The fee to transact business
as a mortgage broker may not exceed five hundred dollars. The fee to transact business as a
mortgage lender may not exceed one thousand dollars. The fee to register as a mortgage loan
originator may not exceed two hundred fifty dollars. Any licensee or registrant that files for
renewal after December first and before January first of the next calendar year shall pay a late fee
in addition to the renewal fee. The late fee, not to exceed twenty-five percent of the renewal fee,
shall be established by the director by rules promulgated pursuant to chapter 1-26. After January
first no license may be issued unless an application is filed pursuant to sections 2 to 5, inclusive,
of this Act.
The following entities and their employees and exclusive agents are exempt from
the provisions of this Act:
Any mortgage broker or mortgage lender licensed to practice in the State of South
Dakota may use the services of a mortgage loan originator that operates under direct control and
supervision of the mortgage broker or mortgage lender. The mortgage loan originator shall be
registered by the director and while registered and employed by a mortgage broker or mortgage
lender may not be deemed to be operating as a mortgage broker or mortgage lender.
Any applicant for a license shall submit with the application a bond in the amount
of twenty-five thousand dollars. The bond shall be issued by a surety company qualified to do
business as a surety in this state. The bond shall be in favor of this state for the use of this state and
any person who has a cause of action under this Act against the licensee. The bond shall be
Any person, who without first obtaining a license or registration under this Act,
engages in the business or occupation of, or advertises or holds the person out as, or claims to be,
or temporarily acts as, a mortgage broker, mortgage lender, or mortgage loan originator in this state
is guilty of a Class 2 misdemeanor and may be held responsible for all costs of prosecution,
Any licensee or registrant is subject to examination and investigation by the
director. The director shall promulgate rules pursuant to chapter 1- 26 that specify the process by
which examinations and investigations will be performed.
The director may suspend, not to exceed six months, or revoke a license or
registration if the director finds:
Any licensee whose license or registration is subject to suspension or revocation
by the director, may contest such suspension or revocation in accordance with the provisions of
Any licensee under this Act, in addition to the license and other fees provided by
this Act, shall pay the annual tax provided in chapter 10-43, upon the net income of the licensee
measured by the net income assignable to the licensee's business in South Dakota. The State of
South Dakota, any political subdivision of the state, and any quasi-governmental organization
created by an executive order of the State of South Dakota and any subsidiary of such organization;
any nonprofit United States Treasury Community Development Financial Institution, Small
Business Administration Certified Development Company, or Regional Revolving Loan Fund; or
any commercial club, chamber of commerce, or industrial development corporation formed
9-12-11 or 9-27-37 is exempt from the payment of this tax.
The director may promulgate rules pursuant to chapter 1-26 for the continuing
education of mortgage brokers, mortgage lenders, and mortgage loan originators, and for the
management and administration of licenses and registrations issued pursuant to this Act.
, inclusive, be repealed.
Fees collected pursuant to this Act shall be deposited with the state treasurer in the
banking special revenue fund created in
51A-2-30. Expenditures from the fund shall be
appropriated through the normal budget process.