STAND. COM. REP. NO.  433

 

Honolulu, Hawaii

                , 2009

 

RE:   H.B. No. 1438

      H.D. 1

 

 

 

 

Honorable Calvin K.Y. Say

Speaker, House of Representatives

Twenty-Fifth State Legislature

Regular Session of 2009

State of Hawaii

 

Sir:

 

     Your Committees on Consumer Protection & Commerce and Judiciary, to which was referred H.B. No. 1438 entitled:

 

"A BILL FOR AN ACT RELATING TO MORTGAGE LOAN ORIGINATORS,"

 

beg leave to report as follows:

 

     The purpose of this bill is to protect homebuyers by replacing the Mortgage Brokers and Solicitors Law under Chapter 454, Hawaii Revised Statutes, with a new law regulating mortgage loan originators.

 

     The Office of Hawaiian Affairs and Hawaii Bankers Association testified in support of this bill.  The Legal Aid Society of Hawaii supported the intent of this measure.  The Department of Commerce and Consumer Affairs (DCCA) and Hawaii Financial Services Association opposed this bill.  State Farm Insurance Companies and the Hawaii Association of Mortgage Brokers provided comments.

 

     While this bill is the latest attempt in the last several years to reform mortgage broker regulation, there are additional considerations this time around.  The federal Secure and Fair Enforcement for Mortgage Licensing Act of 2008 (SAFE Act) was passed in July 2008, establishing a uniform licensing and registration system for all mortgage loan originators, including mortgage brokers and loan officers.  If a state does not implement laws consistent with the SAFE Act by federally established deadlines, the federal Department of Housing and Urban Development will provide the regulatory system.

 

     In light of these circumstances and the prospect of ceding regulatory authority over mortgage brokers to federal control, your Committees continue to carefully consider the merits of this bill.

 

     Accordingly, your Committees have amended this bill by changing its effective date to January 1, 2020, to encourage further discussion.  Technical, nonsubstantive amendments were also made for clarity and style.

 

     As affirmed by the records of votes of the members of your Committees on Consumer Protection & Commerce and Judiciary that are attached to this report, your Committees are in accord with the intent and purpose of H.B. No. 1438, as amended herein, and recommend that it pass Second Reading in the form attached hereto as H.B. No. 1438, H.D. 1, and be referred to the Committee on Finance.

 

Respectfully submitted on behalf of the members of the Committees on Consumer Protection & Commerce and Judiciary,

 

 

____________________________

JON RIKI KARAMATSU, Chair

 

____________________________

ROBERT N. HERKES, Chair