the words and terms defined in sections 3 to 8, inclusive, of this act have

the meanings ascribed to them in those sections.

mortgage company pursuant to this chapter.

1. Directly or indirectly, is secured by a lien on commercial property;

and

2. Is created with the consent of the owner of the commercial

property.

located in this state and which is not used for a residential dwelling or

dwellings intended for occupancy by four or fewer families.

institutions.

loan association, thrift company or credit union.

department of business and industry.

course of business, makes commercial mortgage loans of more than

$250,000 that are funded exclusively from one or more of the following

sources:

depository financial institution or other sources that are liability items on

the person’s financial statements.

institutional investor or between the person and a depository financial

institution, trust company, profit-sharing or pension trust, installment

lender or insurance company.

depository financial institution or other sources that are liability items on

the affiliate’s financial statements for which the affiliate’s assets are

pledged. As used in this subsection, "affiliate" means another person

who, directly or indirectly through one or more intermediaries, controls,

is controlled by or is under common control with the person who is the

institutional investor.

company pursuant to this chapter.

(a) A person who, directly or indirectly:

(1) Holds himself out as being able to:

(I) Buy or sell notes secured by liens on real property; or

1. (II) Make loans secured by liens on real property using his own

1. money; and

(2) Does not engage in any other act or transaction described in the

definition of "mortgage broker," as set forth in section 57 of this act,

unless the person is also licensed as a mortgage broker pursuant to

chapter 645B of NRS.

(1) Negotiates, originates or makes or offers to negotiate, originate

or make commercial mortgage loans as an agent for or on behalf of an

institutional investor; and

(2) Does not engage in any other act or transaction described in the

definition of "mortgage broker," as set forth in section 57 of this act,

unless the person is also licensed as a mortgage broker pursuant to

chapter 645B of NRS.

2. For the purposes of this section, a person does not make a loan

secured by a lien on real property using his own money if any portion of

the money that is used to make the loan is provided by another person

who acquires ownership of or a beneficial interest in the loan.

1. Limit any statutory or common law right of a person to bring a

civil action against a mortgage company for any act or omission involved

in the transaction of business by or on behalf of the mortgage company;

2. Limit the right of the state to punish a person for the violation of

any law, ordinance or regulation; or

3. Establish a basis for a person to bring a civil action against the

state or its officers or employees for any act or omission in carrying out

the provisions of this chapter, including, without limitation, any act or

omission relating to the disclosure of information or the failure to

disclose information pursuant to the provisions of this chapter.

provisions of this chapter do not apply to:

1. Any person doing business under the laws of this state, any other

state or the United States relating to banks, savings banks, trust

companies, savings and loan associations, consumer finance companies,

industrial loan companies, credit unions, thrift companies or insurance

companies, unless the business conducted in this state is not subject to

supervision by the regulatory authority of the other jurisdiction, in which

case licensing pursuant to this chapter is required.

2. A real estate investment trust, as defined in 26 U.S.C. § 856,

unless the business conducted in this state is not subject to supervision by

the regulatory authority of the other jurisdiction, in which case licensing

pursuant to this chapter is required.

3. An employee benefit plan, as defined in 29 U.S.C. § 1002(3), if the

loan is made directly from money in the plan by the plan’s trustee.

4. An attorney at law rendering services in the performance of his

duties as an attorney at law.

5. A real estate broker rendering services in the performance of his

duties as a real estate broker.

6. Any firm or corporation:

(a) Whose principal purpose or activity is lending money on real

property which is secured by a mortgage;

(b) Approved by the Federal National Mortgage Association as a

seller and servicer; and

(c) Approved by the Department of Housing and Urban Development

and the Department of Veterans Affairs.

7. Any person doing any act under an order of any court.

8. Any one natural person, or husband and wife, who provides

money for investment in loans secured by a lien on real property, on his

own account, unless such a person makes a loan secured by a lien on

real property using his own money and assigns all or a part of his interest

in the loan to another person, other than his spouse or child, within 5

years after the date on which the loan is made or the deed of trust is

recorded, whichever occurs later.

9. Agencies of the United States and of this state and its political

subdivisions, including the public employees’ retirement system.

10. A seller of real property who offers credit secured by a mortgage

of the property sold.

of this chapter pursuant to subsection 1 or 6 of section 10 of this act

must:

(a) File a written application for a certificate of exemption with the

office of the commissioner;

(b) Pay the fee required pursuant to section 14 of this act; an

d

(c) Include with the written application satisfactory proof that the

person meets the requirements of subsection 1 or 6 of section 10 of this

act.

2. The commissioner may require a person who claims an exemption

from the provisions of this chapter pursuant to subsections 2 to 5,

inclusive, or 7 to 10, inclusive, of section 10 of this act to:

(a) File a written application for a certificate of exemption with the

office of the commissioner;

(b) Pay the fee required pursuant to section 14 of this act; and

(c) Include with the written application satisfactory proof that the

person meets the requirements of at least one of those exemptions.

3. A certificate of exemption expires automatically if, at any time, the

person who claims the exemption no longer meets the requirements of at

least one exemption set forth in the provisions of section 10 of this act.

4. If a certificate of exemption expires automatically pursuant to this

section, the person shall not provide any of the services of a mortgage

company or otherwise engage in, carry on or hold himself out as

engaging in or carrying on the business of a mortgage company, unless

the person applies for and is issued:

(a) A license as a mortgage company pursuant to this chapter; or

(b) Another certificate of exemption.

5. The commissioner may impose upon a person who is required to

apply for a certificate of exemption or who holds a certificate of

exemption an administrative fine of not more than $10,000 for each

violation that he commits, if the person:

(a) Has knowingly made or caused to be made to the commissioner

any false representation of material fact;

(b) Has suppressed or withheld from the commissioner any

information which the person possesses and which, if submitted by him,

would have rendered the person ineligible to hold a certificate of

exemption; or

(c) Has violated any provision of this chapter, a regulation adopted

pursuant to this chapter or an order of the commissioner that applies to a

person who is required to apply for a certificate of exemption or who

holds a certificate of exemption.

exemption from the provisions of this chapter governing the making of a

loan of money.

2. The commissioner may grant the exemption if he finds that:

(a) The making of the loan would not be detrimental to the financial

condition of the lender or the debtor;

(b) The lender or the debtor has established a record of sound

performance, efficient management, financial responsibility and

integrity;

(c) The making of the loan is likely to increase the availability of

capital for a sector of the state economy; and

(d) The making of the loan is not detrimental to the public interest.

3. The commissioner:

(a) May revoke an exemption unless the loan for which the exemption

was granted has been made; and

(b) Shall issue a written statement setting forth the reasons for his

decision to grant, deny or revoke an exemption.

company must file a written application for a license with the office of

the commissioner and pay the fee required pursuant to section 14 of this

act. An application for a license as a mortgage company must:

(a) Be verified.

(b) State the name, residence address and business address of the

applicant and the location of each principal office and branch office at

which the mortgage company will conduct business within this state.

(c) State the name under which the applicant will conduct business as

a mortgage company.

(d) If the applicant is not a natural person, list the name, residence

address and business address of each person who will have an interest in

the mortgage company as a principal, partner, officer, director or trustee,

specifying the capacity and title of each such person.

(e) Indicate the general plan and character of the business.

(f) State the length of time the applicant has been engaged in the

business of a mortgage company.

(g) Include a financial statement of the applicant.

(h) Include any other information required pursuant to the

regulations adopted by the commissioner or an order of the

commissioner.

2. If a mortgage company will conduct business at one or more

branch offices within this state, the mortgage company must apply for a

license for each such branch office.

3. Except as otherwise provided in this chapter, the commissioner

shall issue a license to an applicant as a mortgage company if:

(a) The application complies with the requirements of this chapter;

and

(b) The applicant and each general partner, officer or director of the

applicant, if the applicant is a partnership, corporation or

unincorporated association:

(1) Has a good reputation for honesty, trustworthiness and integrity

and displays competence to transact the business of a mortgage company

in a manner which safeguards the interests of the general public. The

applicant must submit satisfactory proof of these qualifications to the

commissioner.

(2) Has not been convicted of, or entered a plea of nolo contendere

to, a felony or any crime involving fraud, misrepresentation or moral

turpitude.

(3) Has not made a false statement of material fact on his

application.

(4) Has not had a license that was issued pursuant to the provisions

of this chapter or chapter 645B of NRS suspended or revoked within the

10 years immediately preceding the date of his application.

(5) Has not had a license that was issued in any other state, district

or territory of the United States or any foreign country suspended or

revoked within the 10 years immediately preceding the date of his

application.

(6) Has not violated any provision of this chapter or chapter 645B

of NRS, a regulation adopted pursuant thereto or an order of the

commissioner.

4. If an applicant is a partnership, corporation or unincorporated

association, the commissioner may refuse to issue a license to the

applicant if any member of the partnership or any officer or director of

the corporation or unincorporated association has committed any act or

omission that would be cause for refusing to issue a license to a natural

person.

this chapter expires each year on December 31, unless it is renewed. To

renew a license, the licensee must submit to the commissioner on or

before December 31 of each year:

(a) An application for renewal that complies with the requirements of

this chapter; and

(b) The fee required to renew the license pursuant to this section.

2. If the licensee fails to submit any item required pursuant to

subsection 1 to the commissioner on or before December 31 of any year,

the license is canceled. The commissioner may reinstate a canceled

license if the licensee submits to the commissioner:

(a) An application for renewal that complies with the requirements of

this chapter;

(b) The fee required to renew the license pursuant to this section; and

(c) A reinstatement fee of $200.

3. Except as otherwise provided in section 11 of this act, a certificate

of exemption issued pursuant to this chapter expires each year on

December 31, unless it is renewed. To renew a certificate of exemption, a

person must submit to the commissioner on or before December 31 of

each year:

(a) An application for renewal that complies with the requirements of

this chapter; and

(b) The fee required to renew the certificate of exemption.

4. If the person fails to submit any item required pursuant to

subsection 3 to the commissioner on or before December 31 of any year,

the certificate of exemption is canceled. Except as otherwise provided in

section 11 of this act, the commissioner may reinstate a canceled

certificate of exemption if the person submits to the commissioner:

(a) An application for renewal that complies with the requirements of

this chapter;

(b) The fee required to renew the certificate of exemption; and

(c) A reinstatement fee of $100.

5. A person must pay the following fees to apply for, to be issued or

to renew a license as a mortgage company pursuant to this chapter:

(a) To file an original application for a license, $1,500 for the

principal office and $40 for each branch office. The person must also

pay such additional expenses incurred in the process of investigation as

the commissioner deems necessary. All money received by the

commissioner pursuant to this paragraph must be placed in the

investigative account created by NRS 232.545.

(b) To be issued a license, $1,000 for the principal office and $60 for

each branch office.

(c) To renew a license, $500 for the principal office and $100 for each

branch office.

6. A person must pay the following fees to apply for or to renew a

certificate of exemption pursuant to this chapter:

(a) To file an application for a certificate of exemption, $200.

(b) To renew a certificate of exemption, $100.

7. To be issued a duplicate copy of any license or certificate of

exemption, a person must make a satisfactory showing of its loss and pay

a fee of $10.

8. Except as otherwise provided in this chapter, all fees received

pursuant to this chapter must be deposited in the state treasury for credit

to the state general fund.

and 14 of this act, a natural person who applies for the issuance or

renewal of a license as a mortgage company shall submit to the

commissioner:

(a) In any application for issuance of a license, the social security

number of the applicant and the statement prescribed by the welfare

division of the department of human resources pursuant to NRS 425.520.

The statement must be completed and signed by the applicant.

(b) In any application for renewal of a license, the statement

prescribed by the welfare division of the department of human resources

pursuant to NRS 425.520. The statement must be completed and signed

by the applicant.

2. The commissioner shall include the statement required pursuant

to subsection 1 in:

(a) The application or any other forms that must be submitted for the

issuance or renewal of the license; or

(b) A separate form prescribed by the commissioner.

3. The commissioner shall not issue or renew a license as a mortgage

company if the applicant is a natural person who:

(a) Fails to submit the statement required pursuant to subsection 1; o

r

(b) Indicates on the statement submitted pursuant to subsection 1 that

he is subject to a court order for the support of a child and is not in

compliance with the order or a plan approved by the district attorney or

other public agency enforcing the order for the repayment of the amount

owed pursuant to the order.

4. If an applicant indicates on the statement submitted pursuant to

subsection 1 that he is subject to a court order for the support of a child

and is not in compliance with the order or a plan approved by the district

attorney or other public agency enforcing the order for the repayment of

the amount owed pursuant to the order, the commissioner shall advise

the applicant to contact the district attorney or other public agency

enforcing the order to determine the actions that the applicant may take

to satisfy the arrearage.

activities authorized by this chapter.

2. The provisions of this chapter do not prohibit a licensee from:

(a) Holding a license as a mortgage broker pursuant to chapter 645B

of NRS; or

(b) Conducting the business of a mortgage company and the business

of a mortgage broker in the same office or place of business.

conspicuous place in the office for which the license has been issued.

2. A mortgage company may not transfer or assign a license to

another person, unless the commissioner gives his written approval.

percent or more of the outstanding voting stock of a mortgage company

and must approve a transfer of voting stock of a mortgage company

which constitutes a change of control.

2. The person who acquires stock resulting in a change of control of

the mortgage company shall apply to the commissioner for approval of

the transfer. The application must contain information which shows that

the requirements of this chapter for obtaining a license will be satisfied

after the change of control. Except as otherwise provided in subsection 3,

the commissioner shall conduct an investigation to determine whether

those requirements will be satisfied. If, after the investigation, the

commissioner denies the application, he may forbid the applicant from

participating in the business of the mortgage company.

3. A mortgage company may submit a written request to the

commissioner to waive an investigation pursuant to subsection 2. The

commissioner may grant a waiver if the applicant has undergone a

similar investigation by a state or federal agency in connection with the

licensing of or his employment with a financial institution.

4. As used in this section, "change of control" means:

(a) A transfer of voting stock which results in giving a person, directly

or indirectly, the power to direct the management and policy of a

mortgage company; or

(b) A transfer of at least 25 percent of the outstanding voting stock of

a mortgage company.

the department of business and industry, the commissioner shall exercise

general supervision and control over mortgage companies doing business

in this state.

2. In addition to the other duties imposed upon him by law, the

commissioner shall:

(a) Adopt any regulations that are necessary to carry out the

provisions of this chapter, except as to loan fees.

(b) Conduct such investigations as may be necessary to determine

whether any person has violated any provision of this chapter, a

regulation adopted pursuant to this chapter or an order of the

commissioner.

(c) Conduct an annual examination of each mortgage company doing

business in this state.

(d) Conduct such other examinations, periodic or special audits,

investigations and hearings as may be necessary and proper for the

efficient administration of the laws of this state regarding mortgage

companies.

(e) Classify as confidential certain records and information obtained

by the division when those matters are obtained from a governmental

agency upon the express condition that they remain confidential. This

paragraph does not limit examination by the legislative auditor.

(f) Conduct such examinations and investigations as are necessary to

ensure that mortgage companies meet the requirements of this chapter

for obtaining a license, both at the time of the application for a license

and thereafter on a continuing basis.

3. For each special audit, investigation or examination, a mortgage

company shall pay a fee based on the rate established pursuant to NRS

658.101.

pursuant to NRS 658.055 and cooperate fully with the audits and

examinations performed pursuant thereto.

audit, investigation or hearing, the commissioner may:

(a) Compel the attendance of any person by subpoena.

(b) Administer oaths.

(c) Examine any person under oath concerning the business and

conduct of affairs of any person subject to the provisions of this chapter

and in connection therewith require the production of any books, records

or papers relevant to the inquiry.

2. Any person subpoenaed under the provisions of this section who

willfully refuses or willfully neglects to appear at the time and place

named in the subpoena or to produce books, records or papers required

by the commissioner, or who refuses to be sworn or answer as a witness,

is guilty of a misdemeanor.

3. The commissioner may assess against and collect from a person

all costs, including, without limitation, reasonable attorney’s fees, that

are attributable to any examination, periodic or special audit,

investigation or hearing that is conducted to examine or investigate the

conduct, activities or business of the person pursuant to this chapter.

times at each location where the mortgage company conducts business in

this state complete and suitable records of all mortgage transactions

made by the mortgage company at that location. Each mortgage

company shall also keep and maintain at all times at each such location

all original books, papers and data, or copies thereof, clearly reflecting

the financial condition of the business of the mortgage company.

2. Each mortgage company shall submit to the commissioner each

month a report of the mortgage company’s activity for the previous

month. The report must:

(a) Specify the volume of loans made by the mortgage company for

the month or state that no loans were made in that month;

(b) Include any information required pursuant to the regulations

adopted by the commissioner; and

(c) Be submitted to the commissioner by the 15th day of the month

following the month for which the report is made.

3. The commissioner may adopt regulations prescribing accounting

procedures for mortgage companies handling trust accounts and the

requirements for keeping records relating to such accounts.

than 60 days after the last day of each fiscal year for a mortgage

company, the mortgage company shall submit to the commissioner a

financial statement that:

(a) Is dated not earlier than the last day of the fiscal year; and

(b) Has been prepared from the books and records of the mortgage

company by an independent public accountant who holds a permit to

engage in the practice of public accounting in this state that has not been

revoked or suspended.

2. The commissioner may grant a reasonable extension for the

submission of a financial statement pursuant to this section if a mortgage

company requests such an extension before the date on which the

financial statement is due.

3. If a mortgage company maintains any accounts described in

section 26 of this act, the financial statement submitted pursuant to this

section must be audited. The public accountant who prepares the report

of an audit shall submit a copy of the report to the commissioner at the

same time that he submits the report to the mortgage company.

4. The commissioner shall adopt regulations prescribing the scope of

an audit conducted pursuant to subsection 3.

specific statute, all papers, documents, reports and other written

instruments filed with the commissioner pursuant to this chapter are

open to public inspection.

2. The commissioner may withhold from public inspection or refuse

to disclose to a person, for such time as the commissioner considers

necessary, any information that, in his judgment, would:

(a) Impede or otherwise interfere with an investigation that is

currently pending against a mortgage company; or

(b) Have an undesirable effect on the welfare of the public or the

welfare of any mortgage company.

amount of any advance fee, salary, deposit or money paid to any

mortgage company or other person to obtain a loan secured by a lien on

real property must be placed in escrow pending completion of the loan or

a commitment for the loan.

2. The amount held in escrow pursuant to subsection 1 must be

released:

(a) Upon completion of the loan or commitment for the loan, to the

mortgage company or other person to whom the advance fee, salary,

deposit or money was paid.

(b) If the loan or commitment for the loan fails, to the person who

made the payment.

3. Advance payments to cover reasonably estimated costs paid to

third persons are excluded from the provisions of subsections 1 and 2 if

the person making them first signs a written agreement which specifies

the estimated costs by item and the estimated aggregate cost, and which

recites that money advanced for costs will not be refunded. If an itemized

service is not performed and the estimated cost thereof is not refunded,

the recipient of the advance payment is subject to the penalties provided

in section 39 of this act.

taxes or insurance premiums on real property which secures any loan

made by the mortgage company must be deposited in an insured

depository financial institution and kept separate, distinct and apart from

money belonging to the mortgage company. Such money, when

deposited, is to be designated as an "impound trust account" or under

some other appropriate name indicating that the accounts are not the

money of the mortgage company.

2. The mortgage company has a fiduciary duty to each debtor with

respect to the money in an impound trust account.

3. The mortgage company shall, upon reasonable notice, account to

any debtor whose real property secures a loan made by the mortgage

company for any money which that person has paid to the mortgage

company for the payment of taxes or insurance premiums on the real

property.

4. The mortgage company shall, upon reasonable notice, account to

the commissioner for all money in an impound trust account.

5. A mortgage company shall:

(a) Require contributions to an impound trust account in an amount

reasonably necessary to pay the obligations as they become due.

(b) Within 30 days after the completion of the annual review of an

impound trust account, notify the debtor:

(1) Of the amount by which the contributions exceed the amount

reasonably necessary to pay the annual obligations due from the

account; and

(2) That the debtor may specify the disposition of the excess money

within 20 days after receipt of the notice. If the debtor fails to specify

such a disposition within that time, the mortgage company shall

maintain the excess money in the account.

This subsection does not prohibit a mortgage company from requiring

additional amounts to be paid into an impound trust account to recover a

deficiency that exists in the account.

6. A mortgage company shall not make payments from an impound

trust account in a manner that causes a policy of insurance to be

canceled or causes property taxes or similar payments to become

delinquent.

execution or attachment on any claim against the mortgage company.

2. It is unlawful for a mortgage company knowingly to keep or cause

to be kept any money in a depository financial institution under the

heading of "impound trust account" or any other name designating such

money as belonging to the debtors of the mortgage company, unless the

money has been paid to the mortgage company by a debtor pursuant to

section 26 of this act and is being held in trust by the mortgage company

pursuant to the provisions of that section.

mortgage company pursuant to the terms of a loan secured by a lien on

real property, the mortgage company may not charge the person a late

fee, an additional amount of interest or any other penalty in connection

with that payment if the payment is delivered to the mortgage company

before 5 p.m. on:

(a) The day that the payment is due pursuant to the terms of the loan,

if an office of the mortgage company is open to customers until 5 p.m. on

that day; or

(b) The next day that an office of the mortgage company is open to

customers until 5 p.m., if the provisions of paragraph (a) do not

otherwise apply.

2. A person and a mortgage company may not agree to alter or waive

the provisions of this section by contract or other agreement, and any

such contract or agreement is void and must not be given effect to the

extent that it violates the provisions of this section.

commissioner may investigate a mortgage company or other person if,

for any reason, it appears that:

(a) The mortgage company is conducting business in an unsafe and

injurious manner or in violation of any provision of this chapter, a

regulation adopted pursuant to this chapter or an order of the

commissioner;

(b) The person is offering or providing any of the services of a

mortgage company or otherwise engaging in, carrying on or holding

himself out as engaging in or carrying on the business of a mortgage

company without being licensed or exempt from licensing pursuant to

the provisions of this chapter; or

(c) The person is violating any other provision of this chapter, a

regulation adopted pursuant to this chapter or an order of the

commissioner.

2. If, upon investigation, the commissioner has reasonable cause to

believe that the mortgage company or other person has engaged in any

conduct or committed any violation described in subsection 1, the

commissioner may:

(a) Advise the district attorney of the county in which the conduct or

violation occurred, and the district attorney shall cause the appropriate

legal action to be taken against the mortgage company or other person to

enjoin the conduct or the operation of the business or prosecute the

violation; and

(b) Bring a civil action to:

(1) Enjoin the mortgage company or other person from engaging in

the conduct, operating the business or committing the violation; and

(2) Enjoin any other person who has encouraged, facilitated, aided

or participated in the conduct, the operation of the business or the

commission of the violation, or who is likely to engage in such acts, from

engaging in or continuing to engage in such acts.

3. If the commissioner brings a civil action pursuant to subsection 2,

the district court of any county of this state is hereby vested with the

jurisdiction in equity to enjoin the conduct, the operation of the business

or the commission of the violation and may grant any injunctions that

are necessary to prevent and restrain the conduct, the operation of the

business or the commission of the violation. During the pendency of the

proceedings before the district court:

(a) The court may issue any temporary restraining orders as may

appear to be just and proper;

(b) The findings of the commissioner shall be deemed to be prima

facie evidence and sufficient grounds, in the discretion of the court, for

the ex parte issuance of a temporary restraining order; and

(c) The commissioner may apply for and on due showing is entitled to

have issued the court’s subpoena requiring forthwith the appearance of

any person to:

(1) Produce any documents, books and records as may appear

necessary for the hearing of the petition; and

(2) Testify and give evidence concerning the conduct complained of

in the petition.

pursuant to this chapter, if the commissioner has reasonable cause to

believe that:

(a) The assets or capital of a mortgage company are impaired; or

(b) A mortgage company is conducting business in an unsafe and

injurious manner that may result in danger to the public,

the commissioner may immediately take possession of all the property,

business and assets of the mortgage company that are located in this

state and retain possession of them pending further proceedings provided

for in this chapter.

2. If the licensee, the board of directors or any officer or person in

charge of the offices of the mortgage company refuses to permit the

commissioner to take possession of the property of the mortgage

company pursuant to subsection 1:

(a) The commissioner shall notify the attorney general; and

(b) The attorney general shall immediately bring such proceedings as

may be necessary to place the commissioner in immediate possession of

the property of the mortgage company.

3. If the commissioner takes possession of the property of the

mortgage company, the commissioner shall:

(a) Make or have made an inventory of the assets and known

liabilities of the mortgage company; and

(b) File one copy of the inventory in his office and one copy in the

office of the clerk of the district court of the county in which the

principal office of the mortgage company is located and shall mail one

copy to each stockholder, partner, officer, director or associate of the

mortgage company at his last known address.

4. The clerk of the court with which the copy of the inventory is filed

shall file it as any other case or proceeding pending in the court and

shall give it a docket number.

a mortgage company pursuant to section 30 of this act, the licensee,

officers, directors, partners, associates or stockholders of the mortgage

company may, within 60 days after the date on which the commissioner

takes possession of the property, make good any deficit in the assets or

capital of the mortgage company or remedy any unsafe and injurious

conditions or practices of the mortgage company.

2. At the expiration of the 60-day period, if the deficiency in assets or

capital has not been made good or the unsafe and injurious conditions or

practices remedied, the commissioner may apply to the court to be

appointed receiver and proceed to liquidate the assets of the mortgage

company which are located in this state in the same manner as now

provided by law for liquidation of a private corporation in receivership.

3. No other person may be appointed receiver by any court without

first giving the commissioner ample notice of his application.

4. The inventory made by the commissioner and all claims filed by

creditors are open at all reasonable times for inspection, and any action

taken by the receiver upon any of the claims is subject to the approval of

the court before which the cause is pending.

5. The expenses of the receiver and compensation of counsel, as well

as all expenditures required in the liquidation proceedings, must be fixed

by the commissioner subject to the approval of the court and, upon

certification of the commissioner, must be paid out of the money in his

hands as the receiver.

or not he is issued a license, the commissioner may impose upon the

applicant an administrative fine of not more than $10,000, if the

applicant:

(a) Has knowingly made or caused to be made to the commissioner

any false representation of material fact;

(b) Has suppressed or withheld from the commissioner any

information which the applicant possesses and which, if submitted by

him, would have rendered the applicant ineligible to be licensed pursuant

to the provisions of this chapter; or

(c) Has violated any provision of this chapter, a regulation adopted

pursuant to this chapter or an order of the commissioner in completing

and filing his application for a license or during the course of the

investigation of his application for a license.

2. For each violation committed by a licensee, the commissioner may

impose upon the licensee an administrative fine of not more than

$10,000, may suspend, revoke or place conditions upon his license, or

may do both, if the licensee, whether or not acting as such:

(a) Is insolvent;

(b) Is grossly negligent or incompetent in performing any act for

which he is required to be licensed pursuant to the provisions of this

chapter;

(c) Does not conduct his business in accordance with law or has

violated any provision of this chapter, a regulation adopted pursuant to

this chapter or an order of the commissioner;

(d) Is in such financial condition that he cannot continue in business

with safety to his customers;

(e) Has made a material misrepresentation in connection with any

transaction governed by this chapter;

(f) Has suppressed or withheld from a client any material facts, data

or other information relating to any transaction governed by the

provisions of this chapter which the licensee knew or, by the exercise of

reasonable diligence, should have known;

(g) Has knowingly made or caused to be made to the commissioner

any false representation of material fact or has suppressed or withheld

from the commissioner any information which the licensee possesses and

which, if submitted by him, would have rendered the licensee ineligible to

be licensed pursuant to the provisions of this chapter;

(h) Has failed to account to persons interested for all money received

for a trust account;

(i) Has refused to permit an examination by the commissioner of his

books and affairs or has refused or failed, within a reasonable time, to

furnish any information or make any report that may be required by the

commissioner pursuant to the provisions of this chapter or a regulation

adopted pursuant to this chapter;

(j) Has been convicted of, or entered a plea of nolo contendere to, a

felony or any crime involving fraud, misrepresentation or moral

turpitude;

(k) Has refused or failed to pay, within a reasonable time, any fees,

assessments, costs or expenses that the licensee is required to pay

pursuant to this chapter or a regulation adopted pursuant to this chapter;

(l) Has failed to satisfy a claim made by a client which has been

reduced to judgment;

(m) Has failed to account for or to remit any money of a client within

a reasonable time after a request for an accounting or remittal;

(n) Has commingled the money or other property of a client with his

own or has converted the money or property of others to his own use; or

(o) Has engaged in any other conduct constituting a deceitful,

fraudulent or dishonest business practice.

issued pursuant to NRS 425.540 that provides for the suspension of all

professional, occupational and recreational licenses, certificates and

permits issued to a person who is the holder of a license as a mortgage

company, the commissioner shall deem the license issued to that person

to be suspended at the end of the 30th day after the date on which the

court order was issued unless the commissioner receives a letter issued to

the holder of the license by the district attorney or other public agency

pursuant to NRS 425.550 stating that the holder of the license has

complied with the subpoena or warrant or has satisfied the arrearage

pursuant to NRS 425.560.

2. The commissioner shall reinstate a license as a mortgage

company that has been suspended by a district court pursuant to NRS

425.540 if the commissioner receives a letter issued by the district

attorney or other public agency pursuant to NRS 425.550 to the person

whose license was suspended stating that the person whose license was

suspended has complied with the subpoena or warrant or has satisfied

the arrearage pursuant to NRS 425.560.

association, the commissioner may take any disciplinary action set forth

in this chapter against the person if any member of the partnership or

any officer or director of the corporation or unincorporated association

has committed any act or omission that would be cause for taking such

disciplinary action against a natural person.

disciplinary action against a person or denying a person’s application for

a license, the commissioner shall cause written notice of the order to be

served personally or sent by certified mail or telegraph to the person.

2. Unless a hearing has already been conducted concerning the

matter, the person, upon application, is entitled to a hearing. If the

person does not make such an application within 20 days after the date

of the initial order, the commissioner shall enter a final order concerning

the matter.

3. A person may appeal a final order of the commissioner in

accordance with the provisions of chapter 233B of NRS that apply to a

contested case.

services of a mortgage company or otherwise to engage in, carry on or

hold himself out as engaging in or carrying on the business of a

mortgage company without first obtaining a license as a mortgage

company pursuant to this chapter, unless the person:

1. Is exempt from the provisions of this chapter; and

2. Complies with the requirements for that exemption.

business trust to conduct any business as a mortgage company within

this state, unless it:

1. Qualifies under chapter 80 of NRS; and

2. Complies with the provisions of this chapter or, if it claims an

exemption from the provisions of this chapter, complies with the

requirements for that exemption.

person, or any general partner, director, officer, agent or employee of a

person, who violates any provision of this chapter, a regulation adopted

pursuant to this chapter or an order of the commissioner is guilty of a

misdemeanor.

employee of a person, who violates any provision of section 25, 26 or 27

of this act is guilty of:

1. A misdemeanor if the amount involved is less than $250;

2. A gross misdemeanor if the amount involved is $250 or more but

less than $1,000; or

3. A category D felony if the amount involved is $1,000 or more, and

shall be punished as provided in NRS 193.130.

1. As a substitute for the surety bond required by NRS 627.180, a

by direct and sole order of the state contractors’ board. The value of any

item deposited pursuant to this section must be based upon principal

amount or market value, whichever is lower.

3. The surety bond must be in substantially the following form:

initially deposit a surety bond that complies with the provisions of this

section or a substitute form of security that complies with the provisions

of section 40 of this act in the amount of $20,000. Not later than 3

months after the initial deposit and annually thereafter, the construction

control shall:

1. (a) Submit to the state contractors’ board a signed and notarized

1. affidavit attesting to the average monthly balance in the trust account

1. maintained by the construction control; and

1. (b) Deposit a surety bond that complies with the provisions of this

1. section or a substitute form of security that complies with the provisions

1. of section 40 of this act in the following amount based upon the average

1. monthly balance in the trust account maintained by the construction

1. control:

1. AVERAGE MONTHLY BALANCE AMOUNT OF BOND OR

1. SECURITY REQUIRED

1. Less than $2,000,000 $20,000

1. $2,000,000 or more but less than $4,000,000 40,000

1. $4,000,000 or more but less than $6,000,000 60,000

1. $6,000,000 or more but less than $8,000,000 80,000

1. $8,000,000 or more but less than $12,000,000 120,000

1. $12,000,000 or more but less than $20,000,000 200,000

1. complies with the provisions of this section or a substitute form of

1. security that complies with the provisions of NRS 645A.031 in the

1. following amount based upon the average monthly balance of the trust

1. account or escrow account maintained by the escrow agency pursuant to

1. NRS 645A.160:

1. AVERAGE MONTHLY BALANCE AMOUNT OF BOND OR

1. SECURITY REQUIRED

1. $50,000 or less $20,00

1. 0
2. More than $50,000 but not more than $250,000 $50,000

1. More than $250,000 but not more than $500,000 100,000

1. More than $500,000 but not more than $750,000 150,000

1. More than $750,000 but not more than $1,000,000 200,000

1. More than $1,000,000 250,000

The commissioner shall determine the appropriate amount of the surety

bond or substitute form of security that must be deposited initially by the

escrow agency based upon the expected average monthly balance of the

trust account or escrow account maintained by the escrow agency

pursuant to NRS 645A.160. After the initial deposit, the commissioner

shall, on a semiannual basis, determine the appropriate amount of the

surety bond or substitute form of security that must be deposited by the

escrow agency based upon the average monthly balance of the trust

account or escrow account maintained by the escrow agency pursuant to

NRS 645A.160.

pursuant to this section must be based upon principal amount or market

value, whichever is lower.

1. (a) A firm or corporation that is exempt from licensing as a mortgage

1. company pursuant to subsection 6 of section 10 of this act.

to chapter 645B of NRS in the office or place of business.

mortgage broker pursuant to this chapter.

institutions.

NRS 627.050.

and loan association, thrift company or credit union.

the department of business and industry.

645A.010.

645A.010.

692A.028.

license or registration issued in this state or any other state, district or

territory of the United States that authorizes the person who holds the

license or registration to engage in any business or activity described in

the provisions of this chapter, sections 2 to 39, inclusive, of this act,

chapter 604, 645, 645A, 645C or 649 of NRS or Title 55 or 56 of NRS.

acquires ownership of or a beneficial interest in a loan secured by a lien

on real property.

broker pursuant to this chapter.

(a) Is an employee or independent contractor of a mortgage broker

who is required to be licensed pursuant to this chapter; and

(b) Is authorized by the mortgage broker to engage in, on behalf of

the mortgage broker, any activity that would require the person, if he

were not an employee or independent contractor of the mortgage broker,

to be licensed as a mortgage broker pursuant to this chapter.

2. The term does not include a person who:

(a) Is licensed as a mortgage broker;

(b) Is a general partner, officer or director of a mortgage broker; or

(c) Performs only clerical or ministerial tasks for a mortgage broker.

indirectly:

(a) Holds himself out for hire to serve as an agent for any person in

an attempt to obtain a loan which will be secured by a lien on real

property;

(b) Holds himself out for hire to serve as an agent for any person who

has money to lend, if the loan is or will be secured by a lien on real

property;

(c) Holds himself out as being able to make loans secured by liens on

real property;

(d) Holds himself out as being able to buy or sell notes secured by

liens on real property; or

(e) Offers for sale in this state any security which is exempt from

registration under state or federal law and purports to make investments

in promissory notes secured by liens on real property.

2. The term does not include a person who is licensed as a mortgage

company, as defined in section 8 of this act, unless the person is also

licensed as a mortgage broker pursuant to this chapter.

NRS 692A.035.

related within the second degree by blood or marriage.

692A.060.

692A.070.

mortgage lending is hereby created.

2. The advisory council consists of five members appointed by the

legislative commission from a list of persons provided by the

commissioner.

3. The members of the advisory council:

(a) Must be persons who have experience with, an interest in or a

knowledge of issues relating to mortgage investments or mortgage

lending. Such persons may include, without limitation, investors, public

officers and employees, licensees and persons who have engaged in or

been involved with any business, profession or occupation relating to

mortgage investments or mortgage lending.

(b) Serve terms of 2 years and at the pleasure of the legislative

commission.

(c) May be reappointed.

(d) Serve without compensation and may not receive a per diem

allowance or travel expenses.

1. 4. Any vacancy in the membership of the advisory council must be

1. filled for the remainder of the unexpired term in the same manner as the

1. original appointment.

5. A member of the advisory council who is an officer or employee of

this state or a political subdivision of this state must be relieved from his

duties without loss of his regular compensation so that he may prepare

for and attend meetings of the advisory council and perform any work

necessary to carry out the duties of the advisory council in the most

timely manner practicable. A state agency or political subdivision of this

state shall not require an officer or employee who is a member of the

advisory council to make up the time he is absent from work to carry out

his duties as a member of the advisory council or use annual vacation or

compensatory time for the absence.

6. Notwithstanding any other provision of law, a member of the

advisory council:

(a) Is not disqualified from public employment or holding a public

office because of his membership on the advisory council; and

(b) Does not forfeit his public office or public employment because of

his membership on the advisory council.

1. investments and mortgage lending shall elect a chairman and a vice

1. chairman from among their membership. The vice chairman shall

1. perform the duties of the chairman during any absence of the chairman.

1. 2. The advisory council may meet at least once each calendar

1. quarter and at other times on the call of the chairman or a majority of its

1. members.

1. 3. The meetings of the advisory council may be held at any location

1. designated by the chairman or a majority of its members.

1. 4. A majority of the members of the advisory council constitutes a

1. quorum for the transaction of all business.
2. 5. The chairman may appoint subcommittees of the members of the

1. advisory council to consider specific problems relating to mortgage

1. investments or mortgage lending.

investments and mortgage lending is to:

1. Consult with, advise and make recommendations to the

commissioner in all matters relating to mortgage investments and

mortgage lending.

2. Make recommendations to the legislature concerning the

enactment of any legislation relating to mortgage investments and

mortgage lending.

3. Make recommendations to the legislature and the commissioner

concerning educational requirements and other qualifications for

persons who are engaged in any business, profession or occupation

relating to mortgage investments and mortgage lending.

4. Conduct hearings, conferences and special studies on all matters

relating to mortgage investments and mortgage lending.

5. Provide a forum for the consideration and discussion of all

matters relating to mortgage investments and mortgage lending.

investments and mortgage lending.

7. Engage in other activities that are designed to promote, improve

and protect the reliability and stability of mortgage investments and

mortgage lending in this state.

1. A person who claims an exemption from the provisions of this

chapter pursuant to subsection 1 or 6 of NRS 645B.015 must:

(a) File a written application for a certificate of exemption with the

office of the commissioner;

(b) Pay the fee required pursuant to NRS 645B.050; and

(c) Include with the written application satisfactory proof that the

person meets the requirements of subsection 1 or 6 of NRS 645B.015.

2. The commissioner may require a person who claims an exemption

from the provisions of this chapter pursuant to subsections 2 to 5,

inclusive, or 7 to 10, inclusive, of NRS 645B.015 to:

(a) File a written application for a certificate of exemption with the

office of the commissioner;

(b) Pay the fee required pursuant to NRS 645B.050; and

(c) Include with the written application satisfactory proof that the

person meets the requirements of at least one of those exemptions.

3. A certificate of exemption expires automatically if, at any time, the

person who claims the exemption no longer meets the requirements of at

least one exemption set forth in the provisions of NRS 645B.015.

4. If a certificate of exemption expires automatically pursuant to this

section, the person shall not provide any of the services of a mortgage

broker or otherwise engage in, carry on or hold himself out as engaging

in or carrying on the business of a mortgage broker, unless the person

applies for and is issued:

(a) A license as a mortgage broker pursuant to this chapter; or

(b) Another certificate of exemption.

5. The commissioner may impose upon a person who is required to

apply for a certificate of exemption or who holds a certificate of

exemption an administrative fine of not more than $10,000 for each

violation that he commits, if the person:

(a) Has knowingly made or caused to be made to the commissioner

any false representation of material fact;

(b) Has suppressed or withheld from the commissioner any

information which the person possesses and which, if submitted by him,

would have rendered the person ineligible to hold a certificate of

exemption; or

(c) Has violated any provision of this chapter, a regulation adopted

pursuant to this chapter or an order of the commissioner that applies to a

person who is required to apply for a certificate of exemption or who

holds a certificate of exemption.

applicant if the commissioner has reasonable cause to believe that the

applicant or any general partner, officer or director of the applicant has,

after October 1, 1999, employed or proposed to employ a person as a

mortgage agent or authorized or proposed to authorize a person to be

associated with a mortgage broker as a mortgage agent at a time when

the applicant or the general partner, officer or director knew or, in light

of all the surrounding facts and circumstances, reasonably should have

known that the person:

1. 1. Had been convicted of, or entered a plea of nolo contendere to, a

1. felony or any crime involving fraud, misrepresentation or moral

1. turpitude; or

2. Had a financial services license or registration suspended or

revoked within the immediately preceding 10 years.

may refuse to issue a license to the applicant if the commissioner has

reasonable cause to believe that the applicant would be subject to control

by a relative who would be ineligible to be licensed pursuant to this

chapter.

2. If an applicant is a partnership, corporation or unincorporated

association, the commissioner may refuse to issue a license to the

applicant if:

(a) Any member of the partnership or any officer or director of the

corporation or unincorporated association has committed any act or

omission that would be cause for refusing to issue a license to a natural

person; or

(b) The commissioner has reasonable cause to believe that any

member of the partnership or any officer or director of the corporation

or unincorporated association would be subject to control by a relative

who would be ineligible to be licensed pursuant to this chapter.

limit the authority of the commissioner to refuse to issue a license to an

applicant for any other lawful reason or pursuant to any other provision

of law.

1. Teach his mortgage agents the fundamentals of mortgage lending

and the ethics of the profession; and

2. Supervise the activities of his mortgage agents and the operation

of his business.

1. of a mortgage agent or otherwise engage in, carry on or hold himself out

1. as engaging in or carrying on the activities of a mortgage agent if the

1. person:

1. (a) Has been convicted of, or entered a plea of nolo contendere to, a

1. felony or any crime involving fraud, misrepresentation or moral

1. turpitude; or

1. (b) Has had a financial services license or registration suspended or

1. revoked within the immediately preceding 10 years.

1. 2. A mortgage agent may not be associated with or employed by more

1. than one mortgage broker at the same time.

1. 3. A mortgage broker shall register with the division each person

1. who will be associated with or employed by the mortgage broker as a

1. mortgage agent. To register a person as a mortgage agent, a mortgage

1. broker must:

1. (a) Submit to the division a registration form which is provided by the

1. division and which:

1. (1) States the name, residence address and business address of the

1. person;

1. (2) Is signed by the person;

1. (3) Includes a provision by which the person gives his written

1. consent to an investigation of his credit history, criminal history and

1. background; and

1. (4) Includes any other information or supporting materials required

1. by the regulations adopted by the commissioner. Such information or

1. supporting materials may include, without limitation, a complete set of

1. fingerprints from the person, the social security number of the person

1. and other forms of identification of the person; and

1. (b) Pay the actual costs and expenses incurred by the division to

1. investigate the credit history, criminal history and background of the

1. person. All money received pursuant to this paragraph must be placed in

1. the investigative account created by NRS 232.545.

1. 4. A mortgage broker shall not employ a person as a mortgage agent

1. or authorize a person to be associated with the mortgage broker as a
2. mortgage agent if the mortgage broker has not registered the person with

1. the division pursuant to subsection 3 or if the person:

1. (a) Has been convicted of, or entered a plea of nolo contendere to, a

1. felony or any crime involving fraud, misrepresentation or moral

1. turpitude; or

1. (b) Has had a financial services license or registration suspended or

1. revoked within the immediately preceding 10 years.

5. If a mortgage agent terminates his association or employment

with a mortgage broker for any reason, the mortgage broker shall, not

later than the end of the next business day following the date of

termination:

(a) Deliver to the mortgage agent or send by certified mail to the last

known residence address of the mortgage agent a written statement

which advises him that his termination is being reported to the division;

and

(b) Deliver or send by certified mail to the division:

(1) A written statement of the circumstances surrounding the

termination; and

(2) A copy of the written statement that the mortgage broker

delivers or mails to the mortgage agent pursuant to paragraph (a).

activities authorized by this chapter.

(a) Holding a license as a mortgage company pursuant to sections 2 to

39, inclusive, of this act; or

(b) Conducting the business of a mortgage company and the business

of a mortgage broker in the same office or place of business.

conducts business as or holds a controlling interest or position in:

(a) A construction control;

(b) An escrow agency or escrow agent; or

(c) A title agent, a title insurer or an escrow officer of a title agent or

title insurer,

the licensee shall fully disclose his status as, connection to or relationship

with the construction control, escrow agency, escrow agent, title agent,

title insurer or escrow officer to each investor, and the licensee shall not

require, as a condition to an investor acquiring ownership of or a

beneficial interest in a loan secured by a lien on real property, that the

investor transact business with or use the services of the construction

control, escrow agency, escrow agent, title agent, title insurer or escrow

officer or that the investor authorize the licensee to transact business

with or use the services of the construction control, escrow agency,

escrow agent, title agent, title insurer or escrow officer on behalf of the

investor.

2. For the purposes of this section, a person shall be deemed to hold

a controlling interest or position if the person:

(a) Owns or controls a majority of the voting stock or holds any other

controlling interest, directly or indirectly, that gives him the power to

direct management or determine policy; or

(b) Is a partner, officer, director or trustee.

3. As used in this section, "licensee" means:

(a) A person who is licensed as a mortgage broker pursuant to this

chapter; and

(b) Any general partner, officer or director of such a person.

1. in NRS 645B.175, the mortgage broker and his mortgage agents shall

1. not engage in any activity that is authorized pursuant to this chapter,

1. unless the mortgage broker maintains continuously a minimum net

1. worth in the following amount based upon the average monthly balance

1. of the accounts maintained by the mortgage broker pursuant to NRS

1. 645B.175:

1. AVERAGE MONTHLY BALANCE MINIMUM NET
   WORTH REQUIRED

1. $100,000 or less $25,000

1. More than $100,000 but not more than $250,000 50,000

1. More than $250,000 but not more than $500,000 100,000

1. More than $500,000 but not more than $1,000,000 200,000

1. More than $1,000,000 250,000

The commissioner shall determine the appropriate initial minimum net

worth that must be maintained by the mortgage broker pursuant to this

section based upon the expected average monthly balance of the

accounts maintained by the mortgage broker pursuant to NRS 645B.175.

After determining the initial minimum net worth that must be maintained

by the mortgage broker, the commissioner shall, on an annual basis,

determine the appropriate minimum net worth that must be maintained

by the mortgage broker pursuant to this section based upon the average

monthly balance of the accounts maintained by the mortgage broker

pursuant to NRS 645B.175.

1. 2. If requested by the commissioner, a mortgage broker who is

1. subject to the provisions of this section and his mortgage agents shall

1. submit to the commissioner or allow the commissioner to examine any

1. documentation or other evidence that is related to determining the net

1. worth of the mortgage broker.

3. The commissioner:

(a) Shall adopt regulations prescribing standards for determining the

net worth of a mortgage broker; and

(b) May adopt any other regulations that are necessary to carry out

the provisions of this section.

than 60 days after the last day of each fiscal year for a mortgage broker,

the mortgage broker shall submit to the commissioner a financial

statement that:

(a) Is dated not earlier than the last day of the fiscal year; and

(b) Has been prepared from the books and records of the mortgage

broker by an independent public accountant who holds a permit to

engage in the practice of public accounting in this state that has not been

revoked or suspended.

2. The commissioner may grant a reasonable extension for the

submission of a financial statement pursuant to this section if a mortgage

broker requests such an extension before the date on which the financial

statement is due.

3. If a mortgage broker maintains any accounts described in

subsection 1 of NRS 645B.175, the financial statement submitted

pursuant to this section must be audited. If a mortgage broker maintains

any accounts described in subsection 4 of NRS 645B.175, those accounts

must be audited. The public accountant who prepares the report of an

audit shall submit a copy of the report to the commissioner at the same

time that he submits the report to the mortgage broker.

4. The commissioner shall adopt regulations prescribing the scope of

an audit conducted pursuant to subsection 3.

mortgage broker or mortgage agent shall not accept money from an

investor to acquire ownership of or a beneficial interest in a loan secured

by a lien on real property, unless the mortgage broker has obtained a

written appraisal of the real property securing the loan.

2. The written appraisal of the real property:

(a) Must be performed by an appraiser who is authorized to perform

appraisals in this state; and

(b) Must not be performed by the mortgage broker or a mortgage

agent, unless the mortgage broker or mortgage agent is certified or

licensed to perform such an appraisal pursuant to chapter 645C of NRS.

3. A copy of the written appraisal of the real property must be:

(a) Maintained at each office of the mortgage broker where money is

accepted from an investor to acquire ownership of or a beneficial interest

in a loan secured by a lien on the real property; and

(b) Made available during normal business hours for inspection by

each such investor and the commissioner.

4. A mortgage broker is not required to obtain a written appraisal of

the real property pursuant to this section if the mortgage broker obtains a

written waiver of the appraisal from each investor who acquires

ownership of or a beneficial interest in a loan secured by a lien on the

real property. A mortgage broker or mortgage agent shall not act as the

attorney in fact or the agent of an investor with respect to the giving of a

written waiver pursuant to this subsection.

5. As used in this section, "appraisal" has the meaning ascribed to it

in NRS 645C.030.

designee pursuant to subsection 2 of NRS 645B.175 upon completion of

a loan secured by a lien on real property, the mortgage broker that

arranged the loan shall, not later than 3 business days after the date on

which the mortgage broker receives a copy of the recorded deed of trust,

mail to the last known address of each investor who owns a beneficial

interest in the loan a copy of the recorded deed of trust.

in subsection 4 of NRS 645B.175 in which the mortgage broker deposits

payments from a debtor on a loan secured by a lien on real property and,

on the last day of any month, the debtor has failed to make two or more

consecutive payments in accordance with the terms of the loan, the

mortgage broker shall:

1. commissioner pursuant to subsection 2 of NRS 645B.080 the information

1. relating to delinquencies in payments and defaults that is required by the

1. regulations adopted pursuant to subsection 2;

1. (b) Not later than 15 days after the last day of each such month, mail

1. to the last known address of each investor who owns a beneficial interest

1. in the loan a notice containing the information relating to delinquencies

1. in payments and defaults that is required by the regulations adopted

1. pursuant to subsection 2; and

(c) Comply with the provisions of this section each month on a

continuing basis until:

(1) The debtor or his designee remedies the delinquency in

payments and any default; or

(2) The lien securing the loan is extinguished.

1. (a) Shall adopt regulations prescribing the information relating to

1. delinquencies in payments and defaults that a mortgage broker must

1. include in his report to the commissioner and in the notice mailed to

1. investors pursuant to subsection 1. Such regulations may provide for

1. variations between the information that a mortgage broker must include

1. in his report to the commissioner and the information that a mortgage

1. broker must include in the notice mailed to investors.

(b) May adopt any other regulations that are necessary to carry out

the provisions of this section.

mortgage broker pursuant to the terms of a loan secured by a lien on real

property, the mortgage broker may not charge the person a late fee, an

additional amount of interest or any other penalty in connection with

that payment if the payment is delivered to the mortgage broker before
5 p.m. on:

(a) The day that the payment is due pursuant to the terms of the loan,

if an office of the mortgage broker is open to customers until 5 p.m. on

that day; or

(b) The next day that an office of the mortgage broker is open to

customers until 5 p.m., if the provisions of paragraph (a) do not

otherwise apply.

2. A person and a mortgage broker or mortgage agent may not agree

to alter or waive the provisions of this section by contract or other

agreement, and any such contract or agreement is void and must not be

given effect to the extent that it violates the provisions of this section.

in any act or transaction on behalf of an investor pursuant to a power of

attorney unless:

(a) The power of attorney is executed for the sole purpose of providing

services for loans in which the investor owns a beneficial interest; and

(b) The provisions of the power of attorney:

(1) Have been approved by the commissioner;

(2) Expressly prohibit the mortgage broker and his mortgage agents

from engaging in any act or transaction that subordinates the priority of

a recorded deed of trust unless, before such an act or transaction, the

mortgage broker obtains written approval for the subordination from the

investor;

(3) Expressly prohibit the mortgage broker and his mortgage agents

from using or releasing any money in which the investor owns a

beneficial interest with regard to a specific loan for a purpose that is not

directly related to providing services for the loan unless, before any such

money is used or released for another purpose, the mortgage broker

obtains written approval from the investor to use or release the money for

the other purpose; and

(4) Expressly provide that the power of attorney is effective for a

period of not more than 6 months unless, before the date on which the

period expires, the mortgage broker obtains written approval from the

investor to extend the power of attorney for an additional period of not

more than 6 months. The mortgage broker may, on a continuing basis,

obtain written approval from the investor to extend the power of attorney

for one or more consecutive periods of not more than 6 months each,

except that the investor may execute only one written approval for an

extension during each such 6-month period.

2. A mortgage broker or mortgage agent shall not act as the attorney

in fact or the agent of an investor with respect to the giving of written

approval pursuant to paragraph (b) of subsection 1. An investor and a

mortgage broker or mortgage agent may not agree to alter or waive the

provisions of this section by contract or other agreement. Any such

contract or agreement is void and must not be given effect to the extent

that it violates the provisions of this section.

3. A power of attorney which designates a mortgage broker or

mortgage agent as the attorney in fact or the agent of an investor and

which violates the provisions of this section is void and must not be given

effect with regard to any act or transaction that occurs on or after

October 1, 1999, whether or not the power of attorney is or has been

executed by the investor before, on or after October 1, 1999.

4. The provisions of this section do not limit the right of an investor

to include provisions in a power of attorney that are more restrictive than

the provisions set forth in subsection 1.

adopted pursuant to subsection 2, file a complaint with the

commissioner, alleging that another person has violated a provision of

this chapter, a regulation adopted pursuant to this chapter or an order of

the commissioner.

2. The commissioner shall adopt regulations prescribing:

(a) The form that such a complaint must take;

(b) The information that must be included in such a complaint; and

(c) The procedures that a person must follow to file such a complaint.

commissioner pursuant to section 76 of this act, the commissioner shall

investigate each violation alleged in the complaint, unless the

commissioner has previously investigated the alleged violation.

2. Except as otherwise provided in subsection 2 of NRS 645B.090, if

the commissioner does not conduct an investigation of an alleged

violation pursuant to subsection 1 because he previously has investigated

the alleged violation, the commissioner shall provide to the person who

filed the complaint a written summary of the previous investigation and

the nature of any disciplinary action that was taken as a result of the

previous investigation.

3. If the commissioner conducts an investigation of an alleged

violation pursuant to subsection 1, the commissioner shall determine

from the investigation whether there is reasonable cause to believe that

the person committed the alleged violation.

4. If, upon investigation, the commissioner determines that there is

not reasonable cause to believe that the person committed the alleged

violation, the commissioner shall provide the reason for his

determination, in writing, to the person who filed the complaint and to

the person alleged to have committed the violation.

5. Except as otherwise provided in subsection 6, if, upon

investigation, the commissioner determines that there is reasonable cause

to believe that the person committed the alleged violation, the

commissioner shall:

(a) Schedule a hearing concerning the alleged violation;

(b) Mail to the last known address of the person who filed the

complaint written notice that must include, without limitation:

(1) The date, time and place of the hearing; and

(2) A statement of each alleged violation that will be considered at

the hearing; and

(c) By personal service in accordance with the Nevada Rules of Civil

Procedure and any applicable provision of NRS, serve written notice of

the hearing to the person alleged to have committed the violation. The

written notice that is served pursuant to this paragraph must include,

without limitation:

(1) The date, time and place of the hearing;

(2) A copy of the complaint and a statement of each alleged

violation that will be considered at the hearing; and

(3) A statement informing the person that, pursuant to section 81 of

this act, if he fails to appear, without reasonable cause, at the hearing:

(I) He is guilty of a misdemeanor; and

(II) The commissioner is authorized to conduct the hearing in his

absence, draw any conclusions that the commissioner deems appropriate

from his failure to appear and render a decision concerning each alleged

violation.

6. The commissioner is not required to schedule or conduct a

hearing concerning an alleged violation pursuant to subsection 5 if the

commissioner and the person alleged to have committed the violation

enter into a written consent agreement settling or resolving the alleged

violation. If such a written consent agreement is executed, the

commissioner shall provide a copy of the written consent agreement to

the person who filed the complaint.

7. The commissioner may:

(a) Investigate and conduct a hearing concerning any alleged

violation, whether or not a complaint has been filed.

(b) Hear and consider more than one alleged violation against a

person at the same hearing.

mortgage broker or otherwise engages in, carries on or holds himself out

as engaging in or carrying on the business of a mortgage broker and, at

the time:

(a) The person was required to have a license pursuant to this chapter

and the person did not have such a license; or

(b) The person’s license was suspended or revoked pursuant to this

chapter,

the commissioner shall impose upon the person an administrative fine of

not more than $10,000 for each violation and, if the person has a license,

the commissioner shall revoke it.

2. If a person is exempt from the provisions of this chapter pursuant

to subsection 6 of NRS 645B.015 and the person, while exempt,

maintains, offers to maintain or holds himself out as maintaining any

accounts described in subsection 1 of NRS 645B.175 or otherwise

engages in, offers to engage in or holds himself out as engaging in any

activity that would remove the person from the exemption set forth in

subsection 6 of NRS 645B.015, the commissioner shall impose upon the

person an administrative fine of not more than $10,000 for each

violation and the commissioner shall revoke the person’s exemption. If

the commissioner revokes an exemption pursuant to this subsection, the

person may not again be granted the same or a similar exemption from

the provisions of this chapter. The person may apply for a license

pursuant to this chapter unless otherwise prohibited by specific statute.

3. If a mortgage broker violates any provision of subsection 1 of NRS

645B.080 and the mortgage broker fails, without reasonable cause, to

remedy the violation within 20 business days after being ordered by the

commissioner to do so or within such later time as prescribed by the

commissioner, or if the commissioner orders a mortgage broker to

provide information, make a report or permit an examination of his

books or affairs pursuant to this chapter and the mortgage broker fails,

without reasonable cause, to comply with the order within 20 business

days or within such later time as prescribed by the commissioner, the

commissioner shall:

(a) Impose upon the mortgage broker an administrative fine of not

more than $10,000 for each violation;

(b) Suspend or revoke the license of the mortgage broker; and

(c) Conduct a hearing to determine whether the mortgage broker is

conducting business in an unsafe and injurious manner that may result

in danger to the public and whether it is necessary for the commissioner

to take possession of the property of the mortgage broker pursuant to

NRS 645B.150.

each violation that may be committed by a person pursuant to this

chapter or the regulations adopted pursuant to this chapter, the

commissioner shall adopt regulations:

(a) Categorizing the violation as a major violation or a minor

violation; and

(b) Specifying the disciplinary action that will be taken by the

commissioner pursuant to this chapter against a person who commits:

(1) A major violation. The disciplinary action taken by the

commissioner for a major violation must include, without limitation,

suspension or revocation of the person’s license.

1. (2) More than two minor violations. The commissioner may

1. establish graduated sanctions for a person who commits more than two

1. minor violations based upon the number, the frequency and the severity

1. of the minor violations and whether the person previously has committed

1. any major violations.

2. The provisions of this section do not apply to a violation for which

the commissioner is required to take disciplinary action in accordance

with section 78 of this act.

association, the commissioner shall take any disciplinary action required

pursuant to section 78 of this act and may take any other disciplinary

action set forth in this chapter against the person if any member of the

partnership or any officer or director of the corporation or

unincorporated association has committed any act or omission that

would be cause for taking such disciplinary action against a natural

person.

fullest extent permitted by the Constitution of the United States and the

constitution of this state:

1. Order a summary suspension of a license pursuant to subsection 3

of NRS 233B.127; and

2. Take any other action against a licensee or other person that is

necessary to protect the health, safety or welfare of the public.

committed any violation that is described in NRS 645B.100, 645B.120 or

645B.150 or is alleged to have committed a violation of any other

provision of this chapter, a regulation adopted pursuant to this chapter or

an order of the commissioner, and the person fails to appear, without

reasonable cause, at a hearing before the commissioner concerning the

alleged conduct or violation:

1. The commissioner shall notify the attorney general that the person

failed to appear;

2. The person is guilty of a misdemeanor and shall be punished as

provided in NRS 645B.230; and

3. The commissioner may conduct the hearing in the person’s

absence, draw any conclusions that the commissioner deems appropriate

from his failure to appear and render a decision concerning the alleged

conduct or violation.

enforcement of this chapter. The attorney general shall, if appropriate,

investigate and prosecute a person who violates:

(a) Any provision of this chapter, a regulation adopted pursuant to

this chapter or an order of the commissioner, including, without

limitation, a violation of any provision of NRS 645B.100 or 645B.120; or

(b) Any other law or regulation if the violation is committed by the

person in the course of committing a violation described in paragraph

(a).

2. The attorney general shall, if appropriate, investigate and

prosecute a person who is alleged to have committed a violation

described in subsection 1 whether or not:

(a) The commissioner notifies the attorney general of the alleged

violation;

(b) The commissioner takes any disciplinary action against the person

alleged to have committed the violation;

(c) Any other person files a complaint against the person alleged to

have committed the violation; or

(d) A civil action is commenced against the person alleged to have

committed the violation.

3. When acting pursuant to this section, the attorney general may

commence his investigation and file a criminal action without leave of

court, and the attorney general has exclusive charge of the conduct of

the prosecution.

4. Except as otherwise provided by the Constitution of the United

States, the constitution of this state or a specific statute, a person shall, if

requested, provide the attorney general with information that would

assist in the prosecution of any other person who is alleged to have

committed a violation described in subsection 1. If a person fails, without

reasonable cause, to provide the attorney general with such information

upon request, the person is guilty of a misdemeanor and shall be

punished as provided in NRS 645B.230.

action against a person to enforce any provision of this chapter, a

regulation adopted pursuant to this chapter or an order of the

commissioner, including, without limitation, an order of the

commissioner:

(a) Imposing an administrative fine; or

(b) Suspending, revoking or placing conditions upon a license.

2. If the attorney general prevails in any civil action brought

pursuant to this chapter, the court shall order the person against whom

the civil action was brought to pay:

(a) Court costs; and

(b) Reasonable costs of the investigation and prosecution of the civil

action.

3. Whether or not the attorney general brings a civil action against a

person pursuant to this chapter, the attorney general may prosecute the

person for a criminal violation pursuant to this chapter.

defined in sections 46 to 61, inclusive, of this act have the meanings

ascribed to them in those sections.

property using his own money and assigns all or a part of his interest in

the loan to another person, other than his spouse or child, within 5 years

after the date on which the loan is made or the deed of trust is recorded,

whichever occurs later.

pursuant to section 69 of this act.

1. offices within this state, the mortgage broker must apply for a license for

1. each such branch office.

this chapter;

(a) An application for renewal;

(b) The fee required to renew the license pursuant to this section;

(c) If the licensee is a natural person, the statement required pursuant

to NRS 645B.023; and

commissioner on or before December 31 of each year:

for an exemption from the provisions of this chapter; and

submit any item required pursuant to subsection 3 to the commissioner

(a) An application for renewal that includes satisfactory proof that the

person meets the requirements for an exemption from the provisions of

this chapter;

(b) The fee required to renew the certificate of exemption; and

issued or to renew a license as a mortgage broker pursuant to this

chapter:

certificate of exemption pursuant to this chapter:

commissioner.

regulations specifying the general guidelines that will be followed when a

periodic or special audit of a mortgage broker is conducted pursuant to

this chapter.

3. The commissioner may assess against and collect from a person

all costs, including, without limitation, reasonable attorney’s fees, that

pursuant to section 73 of this act or pursuant to the regulations adopted

1. (a) Impede or otherwise interfere with an investigation that is

1. currently pending against a mortgage broker;

1. or mortgage agent; or

1. (c) Give any mortgage broker a competitive advantage over any other

1. mortgage broker.

1. 3. The commissioner shall disclose the following information

1. concerning a mortgage broker to any person who requests it:

1. (a) The findings and results of any investigation which has been

1. completed during the immediately preceding 5 years against the

1. mortgage broker pursuant to the provisions of this chapter and which

1. has resulted in a finding by the commissioner that the mortgage broker

1. committed a violation of a provision of this chapter, a regulation adopted

1. pursuant to this chapter or an order of the commissioner; and

(b) The nature of any disciplinary action that has been taken during

the immediately preceding 5 years against the mortgage broker pursuant

to the provisions of this chapter.

pursuant to this chapter or an order of the commissioner;

this chapter;

mortgage broker;

(q) Has failed to maintain adequate supervision of a mortgage agent

;

(r) Has instructed a mortgage agent to commit an act that would be

cause for the revocation of the license of the mortgage broker, whether

or not the mortgage agent commits the act;

1. (s) Has employed a person as a mortgage agent or authorized a

1. person to be associated with the licensee as a mortgage agent at a time

1. when the licensee knew or, in light of all the surrounding facts and

1. circumstances, reasonably should have known that the person:

1. (1) Had been convicted of, or entered a plea of nolo contendere to,

1. a felony or any crime involving fraud, misrepresentation or moral

1. turpitude; or

1. (2) Had a financial services license or registration suspended or

1. revoked within the immediately preceding 10 years; or

a person or denying a person’s application for a license, the

2. Unless a hearing has already been conducted concerning the

3. A person may appeal a final order of the commissioner in

accordance with the provisions of chapter 233B of NRS that apply to a

contested case.

cause to believe that the mortgage broker or other person has engaged in

any conduct or committed any violation described in subsection 1:

(a) The commissioner shall notify the attorney general of the conduct

or violation and, if applicable, the commissioner shall immediately take

possession of the property of the mortgage broker pursuant to NRS

645B.150; and

(b) The attorney general shall, if appropriate:

(1) Investigate and prosecute the mortgage broker or other person

pursuant to section 82 of this act; and

(2) Bring a civil action to:

(I) Enjoin the mortgage broker or other person from engaging in

the conduct, operating the business or committing the violation; and

(II) Enjoin any other person who has encouraged, facilitated,

aided or participated in the conduct, the operation of the business or the

commission of the violation, or who is likely to engage in such acts, from

engaging in or continuing to engage in such acts.

3. If the attorney general brings a civil action pursuant to subsection

(b) A mortgage broker is conducting business in an unsafe and

mortgage broker pursuant to subsection 1:

3. If the commissioner takes possession of the property of the

mortgage broker, the commissioner shall:

(c) If the mortgage broker maintains any accounts described in NRS

645B.175, not later than 5 business days after the date on which the

commissioner takes possession of the property of the mortgage broker,

mail notice of his possession to the last known address of each person

whose money is deposited in such an account or whose money was or

should have been deposited in such an account during the preceding 12

months.

unsafe and injurious conditions or practices of the mortgage broker.