Maryland passed a bill amending net worth requirements for mortgage lenders, brokers and servicers licensed under the Mortgage Lender Law (MLL). Under the bill, mortgage servicers that operate as an approved servicer for a government sponsored enterprise (GSE) must maintain a net worth that equals or exceeds the largest amount required by the GSE. Mortgage servicers that do not operate as an approved servicer for a GSE must maintain a tangible net worth in amount based on the unpaid principal balance of the entire servicing portfolio. The required net worth must be $100,000, $250,000, $500,000 or $1,000,000, as applicable. The bill also permits a mortgage lender, broker and servicer licensed under the MLL to use an irrevocable letter of credit from a bank or depository institution to satisfy the MLL’s net worth requirement. However, a mortgage servicer may not use a working capital line of credit to satisfy the net worth requirement. In addition, the bill amended recordkeeping requirements under the MLL. The bill becomes effective October 1, 2019.
See Maryland General Assembly website for the full text of the Statutes:http://mgaleg.maryland.gov/2019RS/bills/hb/hb0061t.pdf
