NCCOB
NCCOB

Promoting strength and fairness in
the financial services marketplace


 
  • Examination Information
    • Common Recommendations
    • Common Violations
    • Disclosures
    • Document Retention and Destruction
    • Examination Tips

Common Violations Cited in Examination Reports


The Commissioner may, by order, deny, suspend, revoke, or refuse to issue or renew a license of a licensee or applicant for violations of the NC SAFE Act or may restrict or limit the activities relating to mortgage loans of any licensee or any person who owns an interest in or participates in the business of a licensee.

The Commissioner may, by order, impose a civil penalty of up to $25,000, for each violation of the NC SAFE Act upon a licensee or any partner, officer, director, or other person occupying a similar status or performing similar functions on behalf of a licensee. The Commissioner may also impose a civil penalty of up to twenty-five thousand dollars ($25,000) for each violation of the NC SAFE Act by a person other than a licensee or exempt person.

The mortgage examination staff of the North Carolina Office of Commissioner of Banks has prepared a listing of the most common recommendations cited in Examination Reports.

Regulatory Authority Summary
N.C. Gen. Stat. § 53‑244.040 (a) Licensee allowed individuals to solicit and accept applications for mortgage loans without first obtaining a license as a mortgage loan originator.
N.C. Gen. Stat. § 24-1-1A (c) (1) (f) Licensee collected miscellaneous fees exceeding statutory limit (.25% of loan amount or $150, whichever is greater).
N.C. Gen. Stat. § 53-244.109(5) Licensee failed to timely and clearly disclose to the borrower material information, including the total broker compensation, expected to influence the borrower’s decision.
Title 31, Part 1029 of the Code of Federal Regulations (CFR) Anti-money laundering (AML) programs requirements are not met. Each loan or finance company must develop and implement a written AML program that is reasonably designed to prevent the loan or finance company from being used to facilitate money laundering or the financing of terrorist activities.
N.C. Gen. Stat. § 24 10(g) Licensee collected fees on subordinate lien mortgages exceeding the statutory limit (2% of loan amount).
1) 04 N.C.A.C. 03M .0501(c).

2) Regulation B, Equal Credit Opportunity Act (15 USC 1691), 202.9 Notifications.

3) Fair Credit Reporting Act (FCRA), 15 U.S.C.
Licensee failed to notify individuals of adverse action taken on credit applications or did not notify individuals in a timely manner.
N.C. Gen. Stat. § 53-244.111 (8) Borrowers are paying a premium for discount points yet deriving little benefit in return.
N.C. Gen. Stat. § 53-244.107 Licensee did not clearly display the unique identifier (NMLS Entity ID) of any MLO engaged in the mortgage business on all loan application forms, solicitations, and advertisements, including websites and social media.
N.C. Gen. Stat. § 45-102 Licensee did not, at least 45 days prior to filling a notice of hearing in a foreclosure proceeding, provide written notice to the borrower including resources to avoid foreclosure and an itemization of any chargers that must be paid to bring the loan current.