[0:00] Should we get going then?
>> Yes, please go ahead. And let me just
[0:04] say and I I'll mention it once we start
recording. Uh director Veette is not
[0:10] available uh and able to meet make our
meeting today. So she apologizes but uh
[0:16] we have uh Michael Jenko will be
handling the technical aspects of the
[0:22] meeting and uh we'll go ahead. So Jeff,
if you want to uh begin, I think we're
[0:28] ready.
>> Okay.
[0:30] Thank you. Uh welcome to everybody and
and we'll call the meeting to order. Um
[0:35] beginning with consideration and
approval of the minutes from last
[0:39] meeting, April 8th. Uh can I get uh
someone to approve those for us?
[0:49] » And I'll second.
>> Okay. Minutes have been approved.
[0:54] » Do we have anyone from Go ahead, Jeff.
All in favor? Sorry. Yeah. Thank you.
[0:57] All in favor?
I
[1:02] » Okay,
thank you. Um, anyone here from the
[1:06] public that would like to make comment
at this point?
[1:16] Okay. Um, so we'll move on to our
division section for reports and uh,
[1:22] acting director Justin Barney will will
allow you to go ahead and start with our
[1:26] director's report.
Yes, thank you.
[1:31] Again, as I mentioned, uh, Director
Veette is is unavailable. She apologizes
[1:37] for not being able to attend the meeting
and has asked me to serve as acting
[1:41] director for the meeting today. Uh, she
had one item to u remind the
[1:49] commissioners and that was the OPMA
training. she sent out a a an email
[1:57] about that and just reminded um us that
that training is available and and we
[2:04] should go ahead and participate in that.
If you have any questions, maybe send
[2:09] drop her an email or check with me and
we can we can help you with that.
[2:15] And um I have a a very brief update, but
I'll save that for the uh section for
[2:24] for me when uh I get to speak a little
bit later. So other than that, I I think
[2:30] it may be a quicker meeting uh today and
turn the time back over to you, Jeff.
[2:37] » Thank you. Uh we'll turn the time over
to Laurel for for our licensing and
[2:42] education
uh portion of our meeting here.
[2:46] » Hi. Thanks. Uh good morning everyone.
I'm earlier than normal, so I'm like
[2:52] ready to go. Uh we just have a few
things for you. We have our um our
[2:58] pre-licicensing transition update. So we
moved from 15 hours to 5 hours. I
[3:02] reported on that last time we met, but
we were kind of in the middle of that.
[3:06] But it is uh up and running and we had a
few people that were already taking the
[3:11] 15 hours. So we just made an exception
for them. They reported it to us
[3:17] and then we reported it to the NMLS like
normal. But other than that, other than
[3:21] those few people, this has like been
super smooth. Thanks to Mike Page,
[3:26] thanks to the NMLS,
um we have the credit reporting going
[3:31] right through the NMLS. So, we've taken
us out of the loop and it is Mike Page
[3:37] reported this morning. It's going like
gang busters. So, we have uh we have
[3:41] some good traction with that. And on our
stats uh from December 25, we kind of
[3:51] peaked and then because that's when you
were new. Um
[3:57] sorry, my screens are kind of goofed up.
Uh then it kind of recovered and then
[4:03] from January to June, mortgage lending
is looking good for lensure. They're
[4:09] just like rebounding up up. So we're at
a high a 12-month high for MLOS's. Our
[4:17] PLMs are fairly flat, but that I think
is stable. So looks good. Is there more
[4:23] mortgage business out there? That's what
I'm wondering.
[4:26] » Not a ton. the commission [laughter]
>> looking good in the mortgage robe. I was
[4:31] like,
>> "Yeah,
[4:33] » well,
[4:39] » you kind of can't hear you, Laurel.
>> Uh oh.
[4:42] » If you're talking, it's not muted, but
it was like kind of
[4:46] » Try again."
>> Uh, let's see.
[4:48] » Yeah, I can We can
>> We can hear you now.
[4:51] » Yeah,
>> that was weird.
[4:54] » I do have a fan running. Maybe that's
upsetting the system, but uh so I'm
[5:01] sorry that it's not going gang buster
for you.
[5:06] People are licensing, so it's hopeful.
We're always hopeful at the division
[5:09] that things will pick up and everyone
can make their uh ends meet at the
[5:14] minimum and then exceed at the rest. And
unless you have questions for me, that's
[5:18] all I have for you.
>> Hey Laurel, good job on the uh
[5:22] enforcements, the complaints, and the
cases. You guys are doing great on that.
[5:28] » That's Bren Bren's going to talk about
that. That's herment, right?
[5:31] » I'm just doing licensing. I'll take
credit for it if you want, but
[5:35] » Well, it's not really my thing.
>> Whoever did the spreadsheet, good job.
[5:39] We're excited about it.
>> Yay. Yay.
[5:44] » Uh well, any other questions for Laurel?
[5:50] » Okay. Well, if not, then uh
>> you're back on, Justin.
[5:53] » Okay. Thank you. Uh as the commission
will recall, we have uh a amended the
[6:01] administrative rule uh that has to do
with the mortgage loan originator
[6:07] licensure. So the
uh we used to have the highest I believe
[6:13] it was the highest pre-licicensing
education required in the in the country
[6:19] and we've reduced that from 15 hours to
five hours. We do think that there are
[6:24] some specific items that that should be
uh covered uh prior to licensing and we
[6:30] still have that course, but it's a
five-hour course that was announced last
[6:34] time. Just a reminder that that is uh in
place now. I might ask Laurel or uh Mike
[6:42] Paige, are we getting any feedback on
that? any any uh response from licences
[6:48] about the lower
time requirement to do the
[6:53] pre-licicensing education?
>> Um the only thing that I've been
[6:58] receiving um as far as I've I've not had
any negative uh feedback in regards
[7:05] people seem to be a lot more receptive
to the now the new 5 hour. That is what
[7:09] I've been running into is a lot of times
um applicants will
[7:15] uh have outstanding license requests
that have been been there for se several
[7:20] months but haven't received any
education from them. And so with the
[7:25] implementation of the new 5-h hour um
we're still accepting the 15-hour course
[7:30] requirement if they still if they've
taken it prior to the May 1st deadline.
[7:36] Um I'm not sure how long we want to
continue to accept that as as time goes
[7:40] on. You know, say sometime later in the
year if we want to draw a deadline in
[7:45] terms of that and said no, it's it's
been enough time. The new 5 hours been
[7:50] implemented that needs to be the course
of action now. But um I'm only getting a
[7:57] few, you know, far in between folks that
uh
[8:02] they signed up for the course, but they
never took or they never completed the
[8:06] course until after May 1st. And so
that's where it's kind of throwing a
[8:09] wrench into things. And so I have to
kind of go one by one and make a list of
[8:15] people to send to the animal list for
him for them to manually bank the those
[8:20] hours for them. But it's uh it's kind of
it's dying off a little bit. There's,
[8:26] you know, ones and twos every once in a
while, but I haven't had any um
[8:32] issues regarding that uh with people or
the NMLS. The NLS has been really uh
[8:37] helpful, especially Jennifer Eskina,
who's a the education and licensing uh
[8:43] person with NLS that she's been
fantastic. She uploads the the education
[8:48] within a day or two and uh when I'm able
to process lo the applications, it's
[8:54] been pretty straightforward.
>> And I can add a little bit to that. Uh
[8:59] we just finished out our caravan
yesterday in Spanish Fork and every time
[9:03] I announce, you know, that this is in
play, I get hands up in the air, hooray,
[9:07] from mortgage people. So, they reacted
kind of like uh the commission did when
[9:12] I first kind of brainchilded this. And
uh everyone loves this change. And we
[9:18] honestly didn't have enough content for
15 hours. So uh putting that down into
[9:23] the five hours makes it dense and um
easier and just more accommodating for
[9:29] anyone that wants to come
uh do the mortgage thing in Utah. So
[9:34] we're grateful for your support
initially because that was the first
[9:37] feel and then yeah caravan it's like
cheers silent cheers with hands up in
[9:42] the air. So,
>> I'm sure with the uh NMLS conference
[9:46] next year, um I'll probably get a lot of
high fives and everything like that from
[9:51] folks. So, um I can report back on when
when that happens, but I I suspect that
[9:57] um it it'll continue to grow and uh more
people will be uh coming to our state
[10:05] for that. So,
>> good. And Mike, as I understand it, the
[10:10] the one of the real advantages is now
that you don't have to manually input
[10:16] those hours. They can be uh banked
automatically through the NMLS. Is that
[10:20] right?
>> Right. Yeah. We're we're finally uh
[10:23] catching up with the rest of the
country. Um, so it, yeah, I it's saving
[10:28] me time uh to have to reach out and and
ask for these certificates that obvious
[10:35] that we should have not had to be doing
years ago. But um, so yeah, it I it's
[10:42] cutting my processing time by about
half.
[10:46] » That's good news.
>> That's great.
[10:51] Well, that is uh the extent of my report
to the commission and I'm happy to
[10:56] answer any questions if you have them.
[11:02] » Okay, thank you [clears throat] for your
time.
[11:05] » Thank you Justin. Thank you Laurel and
also Mike. Appreciate you guys. Um
[11:10] enforcement Brenn with us.
>> Yes, thank you so much.
[11:14] » Thank you. Our our case management uh
has remained highly stable and efficient
[11:18] over the last quarter. We maintain a
100% clearance rate perfectly balancing
[11:24] the incoming case load of 19 complaints
by um also closing 19 complaints over
[11:30] that period. Uh which is fantastic. Um
currently the division is managing a
[11:35] healthy inventory of 20 open complaints
with only two requiring escalation to
[11:42] pending legal action.
Is there any uh stats questions before
[11:47] moving on?
>> Hey Bren, great job.
[11:51] » Hey, thank you.
>> Yes, we're
[11:54] » on those legal actions. Are these
stipulations or are they coming up for
[11:58] hearings or is just not determined yet?
>> So, those are technically pending. Um,
[12:04] we haven't had
>> that mapped out quite yet.
[12:09] » Okay. Okay.
We do have one uh stipulation to present
[12:15] to you today if there's no more
enforcement questions.
[12:19] » Okay. Fantastic. I'd like to turn the
time over to Justin uh to present that
[12:23] stipulation. Thank you.
>> Good morning, commissioners. I would
[12:28] like to present a proposed stipulation
in order regarding White Glass Lending
[12:33] LLC. This is docket number RE-2026-048.
[12:41] Division case number is 142309
for your consideration.
[12:47] This investigation originated from a
consumer complaint filed with the
[12:50] division in March 2023.
The complaint alleged that the their
[12:56] property was encumbered by a 865.
[13:02] » Go ahead.
[13:06] I think that was just some feedback.
>> Yeah, we just had that go.
[13:09] » Sorry. So, uh, it was encumbered by an
$865,723
[13:14] loan issued by White Glass Lending,
which was secured using documents forged
[13:19] by a third-party title agent. The
consumer reported that White Glass
[13:23] Lending refused to remove the allegedly
void trust deed from the property's
[13:29] title in a timely manner, which
prevented the homeowners from selling
[13:34] the property. The division's
investigation uncovered the respondent's
[13:38] licensing status had expired January 1,
2022. However, the company continued to
[13:45] engage in residential mortgage loan
activities for approximately 23 months
[13:50] while their license was expired. The
respondent obtained a valid license
[13:55] again on December 8th, 2023.
During the interview, the respondent
[13:59] cited that the gap in lensure was due to
an administrative oversight rather than
[14:04] a willful attempt to circumvent the law.
The unlicensed activity is a violation
[14:10] of Utah code 61-2C-201
[14:15] which requires lensure to transact the
business of residential mortgage loans.
[14:21] To resolve the matter, the respondent
alongside their legal counsel has agreed
[14:26] to a $5,000 civil penalty and the
respondent acknowledges that this action
[14:32] will be published in the division's
quarterly newsletter and shared with
[14:36] other agencies.
Does the commission have any questions?
[14:43] » Did they I mean, did they ever end up
removing the lean like they were
[14:46] supposed to? Just out of curiosity.
>> The lean was removed. Yes.
[14:52] And that came from a title company or
was it from the
[14:56] borrower?
>> So the borrower owned the title company
[15:00] from uh what we've seen in the news. So
he used that title agency to submit
[15:06] documentation.
[15:12] » Okay.
>> Dustin did there was um criminal action
[15:18] taken in that case. Is that right?
>> I believe from this
[15:22] » that doesn't affect this particular
matter. But so that that was why White
[15:27] Glass got drawn into that there was a a
criminal conduct and a criminal case
[15:33] that that went forward. But uh we're
just addressing the issues of the lency
[15:38] at this in this stipulation.
>> Is there any status on their license
[15:44] itself? I mean, was it ever it was not
we're not looking at putting it
[15:49] suspending it or or anything other than
that, right?
[15:54] » All of the individual loan officers were
still licensed. It was just a company
[15:58] license that had lapsed.
>> Okay.
[16:07] » Okay. And that $5,000 penalty, is that
what statutory allowed statute allows or
[16:14] what? How did we determine that?
>> That would have been the maximum uh that
[16:18] they allowed.
>> Okay.
[16:32] I don't I don't have any other
questions.
[16:34] » I don't have any questions on it.
>> None here either.
[16:38] Okay.
>> Thank you, Justin. Thank you, Bren.
[16:44] » Um, in this matter, we'll we'll need to,
uh, go into executive session. And so,
[16:52] uh, if we could make arrangements for
that.
[16:55] » So, sorry, this is Jennifer. I'm with
um, I think that the meeting started
[17:00] early. We joined at 8 o'clock, but it
looks like we missed the public comment
[17:04] portion already. Did that already occur?
>> You were here when they asked for it,
[17:10] but you must have missed it. Is this
Yeah, we started right at 9.
[17:17] » Yeah. Um I joined right at 9:00. I don't
I guess I missed it. I mean, is it
[17:23] possible for us to address some public
comments about the PLM issues that have
[17:28] been circulating?
>> I think that's further in the agenda,
[17:32] isn't it, Jeff?
>> I don't see it in the agenda. That's
[17:35] what I was about.
>> It was for public comment. Uh, Chair
[17:39] Flynn, if you want to since uh she was
here and and wants to address that, if
[17:44] you want to reopen public comment for
this matter, I think you can do that.
[17:48] That's up to you.
>> Okay. Yeah. Let's go ahead and open
[17:51] reopen public comment uh for Jennifer
and and for for Tula Law uh to discuss
[17:57] your matter.
>> Thank you. Um hopefully I think that the
[18:03] uh memo was circulated, our final memo
and this is based on our October
[18:07] meeting. So I wanted to thank you guys
for you know that thoughtful discussion
[18:10] back in October. Uh we took your
concerns seriously. We revised our
[18:15] proposal
um to specifically address some of the
[18:19] issues that were raised.
Um hopefully you guys had a chance to
[18:23] review it and um you know just to
reiterate we're not here asking the
[18:28] commission to reduce standards for the
PLM uh licensing requirements. Um we're
[18:34] just asking for a way to recognize the
equivalent experience portion.
[18:39] So our revised proposal did include you
know a business purpose only maybe
[18:44] designation or alternative documentation
requirements for business purpose
[18:49] lenders perhaps a certification or some
addistation under penalty of perjury
[18:55] prohibiting consumer lending
um I mean generally the issue isn't that
[19:00] these applicants don't have the
experience you know they have it's it's
[19:04] the issue is of you know the current
verification mechanism it doesn't recogn
[19:09] recognize the experience that these
lenders, these business purpose
[19:12] commercial lenders do have, right? So,
we're not, you know, we're not asking
[19:17] you guys to reduce any experience
experience requirements. We're asking
[19:22] you guys to recognize perhaps an
equivalent experience using some sort of
[19:25] documentation
um that's appropriate for business
[19:28] purpose lending. Um I I think that gen
generally there's a regulatory mismatch,
[19:35] you know, between what the current
experience verification method um is and
[19:40] the reality of business purpose lending.
So, you know, the Utah code does um
[19:46] allow for uh the the commission to
exercise discretion.
[19:51] Um, and so we're hoping to maybe work
with you guys to identify acceptable
[19:55] forms of documentary evidence, you know,
um, and we're happy to work with, you
[20:02] know, whatever document standards you
guys believe is appropriate. Maybe loan
[20:06] tapes, loan files, you know, recorded
deeds of trust.
[20:10] Um,
anything, you know, if you guys have
[20:14] suggestions, we're happy to, you know,
work through that. Um, did you guys have
[20:19] any questions or comments based on our
memo?
[20:25] » And if maybe you can address this for me
because I was reading through it, but I
[20:29] didn't get through the whole thing. The
question I think the concern that I've
[20:33] always had is you're bringing in more
investors into Utah that then start
[20:38] taking the single family homes or doing
these things for investment purposes and
[20:43] we already have a shortage of homes and
things like that for regular people. So
[20:49] what like what types of property are
they trying to
[20:54] do loans on here? What is their goal?
it would be to um you know like rehab um
[21:01] one to fours right because that's the
the rule the statutes in Utah require
[21:06] licensing for one to fours um but these
would be investment properties um
[21:10] vacation rentals things like that um not
owneroccupied
[21:15] these wouldn't be the borrowers would
not be you know the ones that are using
[21:19] these to um renovate their own kitchen
or something like that it's it's for
[21:25] investment purposes business purposes
Okay.
[21:32] » Well, the focus on fix and flip the SCR
investment property sounds like one to
[21:38] four consumer.
>> Yeah.
[21:43] » Um, now Mike is is Mike still on. Mike
Page.
[21:48] » Yeah, I'm here.
>> Is this something that could even Can
[21:51] they can you regulate that? I mean, how
do you know or determine,
[21:56] you know, if uh the Well, I guess it's
the experience. You still open it up and
[22:00] they'd still become a PLM. They'd still
receive they could do anything. How
[22:04] could you how can you regulate a
business purpose versus somebody that's
[22:08] not doing it? So, if I'm doing business,
I'm also doing investments, DSCR loans.
[22:14] I'm doing fix and flips and I I've I've
complied to everything. But then you got
[22:19] somebody else that comes in that's kind
of we've loosened up or had some other
[22:22] way to regulate their experience and
what they're doing. They're doing the
[22:26] exact same thing other than they're not
doing the residential side of things.
[22:31] How do you is that even possible to
regulate something like that?
[22:36] Uh it's very
>> it's very difficult um for me to ve to
[22:43] be able to uh verify something uh like
Miss Young is is talking about um where
[22:52] um it's almost this
this if you want to call it a a niche
[22:59] type of market that came about when
COVID happened where um people were shut
[23:05] up and you know not able to conduct
business on a regular basis. And so this
[23:11] thing of um business purpose lending or
or what have you meaning uh became a par
[23:19] became a new a new thing where people
would would start to invest in
[23:23] residential properties to for fix and
flips for renovation for uh commercial
[23:30] lending for that type of a thing. And so
what I review and what I what I coming
[23:37] from my back background in in licensing
here um we've never experienced anything
[23:43] like this before. It's a new it's it's
almost like a new market that that came
[23:49] about somebody's idea to you know make
money quick and easy type of a thing and
[23:56] to I don't want to say circumvent the
rule or to get around normal mortgage
[24:02] origination where um
it's they they use the they go under the
[24:08] name of business purpose type of thing
and so a lot of these business purpose
[24:12] loans that I try to that
that I need to verify are not recorded
[24:17] or or submitted through the NMLS and the
HUD reports. And so it's impossible for
[24:23] me to review anything like that. And so
would be basically
[24:28] deny these deny it because it's it's
there's nothing I can review or verify
[24:33] because it's a because it's a
commercial. A lot of these are
[24:36] commercial in in in in
um
[24:42] » what I want to say
[24:46] in in view in view of point it's the DR
doesn't regulate commercial the
[24:52] commercial side of that we we regulate
first lane residential owner occupied
[24:57] one to four family unit closed end first
uh closed end loans a lot of the I wrote
[25:03] a uh a newsletter article
a few months back regarding just such of
[25:08] just such a things because we've been we
were getting inundated with new lending
[25:13] manager applicants that only did this
type of of lending. Well, they didn't
[25:18] have they they in terms of the lending
pipeline that they are supposed to
[25:23] provide me so that I can verify these
none of these were available for me to
[25:27] look at. So they have to be able to
provide me evidence, physical evidence
[25:33] of the actual loan application to prove
that they are the loan originator on
[25:38] from start to finish uh and they are the
final signer on the 103 document. And so
[25:46] that's where the the difficulty is and
for me to kind of kind of verify this
[25:51] and um
where it's
[25:56] that's the only way I can ver that's the
only way I can see anything happening is
[26:01] because if it's a business purpose loan,
if it is only on the 1 to4 family unit
[26:06] and it is a closed end loan but it's a
non-owner occupied,
[26:11] those don't get reported to the NMLS.
us. So that's where the problem is.
[26:16] » That's exactly right. So we're trying
to, you know, hopefully work with you
[26:20] guys to figure out an alternative way to
show that experience because it's not
[26:25] that they don't these applicants don't
have the experience. You know, it's just
[26:28] that the current verification mechanism
doesn't recognize the experience that
[26:32] they already have. And so our proposal
was to, you know, maybe come up with a
[26:38] special designation or require separate
types of documentation or specific list
[26:43] of documents. What, you know, we're open
to working with you guys to see what
[26:48] you're comfortable with in accepting the
equivalent experience. Um, and that's
[26:52] kind of the
>> Well, the only the only thing that I
[26:56] will accept. um we don't there's not
really an an equivalency that we can
[27:01] that I can accept other than I need the
actual document. So I've had other
[27:06] people for example that they work for a
financial institution like a bank or
[27:11] credit union. Those those do not report
to the NLS. Those don't report to HUD or
[27:16] anything like that. So I need to
actually either I need the physical loan
[27:20] application. So I need 45 loan
applications
[27:24] basically.
>> Okay.
[27:26] um is the only way that I have is the
only way I can do it or in lie of that I
[27:30] can accept uh deeds of trust uh is the
only other uh option that I will accept
[27:38] regarding verif regarding proof of
origination
[27:43] » um and then what happens if these um
deeds of trust and applications don't
[27:49] have an individual but has a company
lender list
[27:52] » they will not qualify based on our rule
And they have to bas it has to be
[27:57] according to our will they have to be if
it's a company that that's done as or if
[28:01] they're part of a team or if they're
part of a me if they supervise something
[28:06] or part of a team or or something like
that that doesn't fall under our rule of
[28:11] a general um origination application
that has to be those that's the thing
[28:17] that I don't know I don't I don't
uh see a way a way around of that
[28:24] because we've We've already have three
options available already. Um, each of
[28:29] them require personal loan origination
anywhere from 15 to 45. Um, and as far
[28:36] as I made an exception in talking with
my supervisors, my director regarding
[28:41] okay, I can't verify they don't have the
that's not listing in the NMLS. What
[28:46] else can I do? And so by providing the
actual documents and it has to be that
[28:52] individual that signed the 103. The
company can't do it. It has to be that
[28:56] individual because they're it's the
individual that's applying for the
[29:00] license, not the company.
>> Hey Jennifer, um what what stops your I
[29:05] mean I know everybody wants to not have
middlemen or whatever, but what stops
[29:09] your people with teaming up with a
lender in Utah in order to accomplish
[29:15] these things? like why do they have
their own PLM when it's as hard as it is
[29:19] to change that specific rule?
>> Yeah, because for the company to get
[29:25] licensed, the PLM has to be um a unique
um uniquely sponsored by the company.
[29:32] So, they can't just use another PLM.
>> Um but if they I guess they'd have to be
[29:37] employed by the companies out here.
Okay. I'm just trying to think of
[29:41] [snorts]
>> well I know there's a uh we've been
[29:44] doing with another company
[clears throat] if you're familiar with
[29:47] who Lending Tree is. So Lending Tree
they are pretty much
[29:53] » they are they are licensed with our
state. I'm dealing with an issue with
[29:58] them right now with the same type of a
thing where they can't get a lending
[30:01] manager because our rule requires this
type of a thing. But Lending Tree is
[30:06] different in that they are a lead
generation type of company where they
[30:09] will basically
uh take applications and or they'll
[30:14] receive they'll receive notifications or
however they do it and they basically
[30:19] farm out these loans to licensed
companies to complete the origination
[30:24] and then that person that takes the
referral or whatever get a a kickback or
[30:30] a fee or a or something like that as far
as payment that in that regard. But um
[30:36] I'm not sure
[sighs]
[30:39] like like Allison was saying um I'm not
sure
[30:46] how how Fortra can then can't just
implement something in that regard if
[30:53] they want to get if they want to do
loans with the state if they or or uh
[30:59] hire somebody off of the street or from
another company to become the PLM.
[31:03] that already has a license or can obtain
that license outside of your company,
[31:09] » right? But the problem still is the
same, right? The people that they're
[31:13] looking for who are, you know,
well-versed in business purpose lending
[31:17] don't have the requirements needed to to
satisfy the the licensed experience that
[31:25] Utah currently needs. So, I mean, we've
tried all avenues and this is just we're
[31:31] we're stuck, right? And so that's why
we're asking for you guys to help us um
[31:36] figure out a solution, maybe, you know,
come up with some sort of equivalent
[31:42] experience that you would approve of.
Mike, weren't you just kind of
[31:45] suggesting like that they work with
somebody in Utah that has the ability to
[31:50] get their PLM
>> because I I don't know if the rules in
[31:55] Utah that if they have to have a
physical location here. I think that's
[31:58] no
>> no requirement to be, you know,
[32:01] physically in Utah. The requirement is
to show the licensed experience and
[32:06] that's just
>> a lot of loan officers in Utah that
[32:09] could show that that you might be able
to partner with,
[32:12] » right? but they don't have the business
purpose experience, right? Because if
[32:16] they are able to meet the the the
lending manager experience requirements,
[32:20] it means that they're licensed as an MLO
doing consumer lending because on the
[32:24] business purpose side, you don't need
that. And consumer lending is very very
[32:27] different from business purpose lending.
>> Okay. [snorts] So, I guess that's where
[32:32] I'm confused because it's like I can do
a business purpose loan.
[32:36] I guess it's not I do have options for
doing it in a business name rather than
[32:40] an individual, but most people that when
they're buying an investment property,
[32:44] it's an individual, then they move it to
the LLC or whatever. The obstacle that
[32:49] you're running up against is that
it's it's going to be a company and not
[32:54] an individual that wants to do these
loans. Is that is that the problem?
[32:59] » Um, it's a company that's trying to get
the license, right? But the difference
[33:03] between the type of lending activity
that business purpose lending companies
[33:07] do versus consumer purpose lending
companies is that the borrowers that
[33:12] they interact with um for business
purpose it is not they're not using the
[33:17] loan proceeds for their personal home,
household or family purposes. It's for
[33:21] investment purposes, right? And so
consumer lending is you're dealing with
[33:24] borrowers who are using these loan
proceeds specifically for personal
[33:28] family or household purposes. So the the
nature of the loan itself is different
[33:34] and business purpose across the board in
other states don't require MLO licensing
[33:41] and that is where we're hung up because
Utah's PLM license does require you know
[33:47] the individual to show MLO experience uh
MLO being listed on the HUD or MCRS
[33:54] being reported which is not required for
business purpose lending. It's kind of
[33:57] like catch 22 and we don't know how to
show that. And so we're asking if you
[34:02] know the commission does have you know
the code allows the commission to
[34:07] you know have a you know discretion to
approve equivalent experience. And so
[34:13] our proposal is to, you know, we gave a
couple of options and we're hoping to
[34:19] work with you guys to come up with
something at your discretion, what is
[34:22] acceptable for you guys to show the
equivalent experience needed in order
[34:27] for these individuals to get their PLM
license. And Mike, the big issue that
[34:31] you're running up against is that
there's no real record of these loans
[34:35] besides like a a deed trust or an
application to show that they have that
[34:41] experience,
>> right? Because it's the company that's
[34:44] signing off on the loan, not an
individual.
[34:46] » Yeah.
>> I mean, we can go further and dig into
[34:49] that, right? I mean, if if the the docs
show the company, um perhaps there's,
[34:54] you know, I'm sure that companies can
show who the originator is on these
[34:58] loans. Um maybe some sort of internal I
I don't know, records or something like
[35:03] that. I mean, I don't have the answer,
but I'm hoping to, you know, work with
[35:07] you guys and just kind of brainstorm and
figure out something.
[35:11] » But but Mike, does um does a PLM have to
have the business purpose experience? I
[35:17] mean because if if I've done a lot, you
know, Allison or whoever, Jeff,
[35:20] whatever. If we've done a lot of
investment properties out there, done
[35:23] things and they become and they're no
longer associated with any other
[35:27] company. They're part of your company
now with Forra or well or the name of
[35:31] the whatever the uh company name will
be. Could they not still be the PLM here
[35:37] in Utah and be working for your company
at that time?
[35:42] So, the lending company would need an
individual to get their PLM license. And
[35:48] the problem is that to get the PLM
license, you have to show specific
[35:52] experience that is verified on either
the HUD or on MCRS or something. And
[35:56] Mike's not able to verify that because
they do business purpose loans and
[35:59] that's not on HUD, right? that that
would be on maybe a loan dock set where
[36:06] they have attestations from the
borrowers that this is this is purpose
[36:09] loans. Um I know that
>> I think what Jeff's trying to get at is
[36:14] like if you just have a regular loan
officer in Utah that has the experience
[36:19] to become a PLM, they can work with your
folks. Like once they have that PLM,
[36:24] there's nothing stopping them from going
and doing an investment property loan.
[36:28] So, like in some ways that's the simple
solution where you have somebody in Utah
[36:34] that has their PLM and then you do these
loans. So, I I guess I'm I'm still
[36:38] confused as to why it's a like why you
guys can't do business here. Yes, you
[36:42] can't as a company get a PLM without
showing that, but you can still do
[36:46] business that way
>> with without showing the experience,
[36:51] » right? Well, because they've already had
the experience on a as a as a one to
[36:55] four unit lender for the PLM, but but
now they're just stepping in working for
[37:01] your company as a PLM. They don't have
they've already had, I would think,
[37:05] equivalent to any of these.
>> They have equivalent experience, but not
[37:10] the type of documentation that Mike
needs to approve
[37:15] them being a PLM.
Is it correct to say, let's just say me,
[37:21] okay, I have I have experience. I do
have my PLM, but like let's just say I'm
[37:25] somebody who doesn't. And Jennifer comes
to me and says, "Hey, we'd like to team
[37:30] up, whatever. Can you go get your PLM?"
I go, "Sure, I'll go get my PLM. Then I
[37:36] can go do investment property loans."
then you can be the PLM for you know my
[37:41] lending company and then we'd be good to
go and my company can apply and get the
[37:45] mortgage entity license then we'd be set
but in reality
[37:49] » in reality that's impossible I mean for
maybe four years now I've been advising
[37:55] my clients go out and find somebody who
can show that they have the license
[37:58] experience and these companies have been
trying for years and they're still not
[38:03] able to find people who can show the
experience that Mike needs because
[38:07] they're not you know they're not listed
on HUDs. They're not listed. They don't
[38:11] have to do MCRS, right? Because they do
business purpose loans. So, their 30
[38:15] years of experience is not um it's it's
it's just not verifiable to Mike in what
[38:21] he needs. And so, what I'm asking is for
us to figure out a different equivalent
[38:27] method of showing that equivalent
experience. Mike, am I I'm missing
[38:32] something here because like what what
would stop them from teaming up with
[38:36] somebody in Utah that has their PLM or
is willing to get their PLM and do what
[38:40] they want to do?
>> Absolutely nothing, right? But they
[38:44] can't get their PLM because they don't
have the equivalent experience to show.
[38:46] » Well, any old loan officer here in Utah
that has 15 under their belt or whatever
[38:51] the thing is can go get their PLM.
>> I think what the is Could I just add
[38:57] this?
>> Yeah, tell me. I'm I just want to
[38:59] understand because I'm trying to help
you find something
[39:01] » and Mike can correct me if [laughter] I
if I misstate this but I think what's
[39:05] what's uh I'm hearing from you Jennifer
is that the pool of candidates that your
[39:12] client is willing to consider to be the
PLM is a is a small group that is not
[39:20] involved in other types of lending. So
in other words, the the uh pool of
[39:27] potential PLM
is only the people that are currently
[39:32] affiliated with your company. What
Allison is saying is that if you expand
[39:37] your pool, there are uh hundreds of
potential PLMs that are either already
[39:45] licensed or
uh have the required experience and and
[39:51] affiliating with one of those people
would allow you to meet the requirement.
[39:56] I think that's what what she's saying.
>> Yes. And I hear that my so we're a law
[40:02] firm and we represent private lenders
across the US. Um for you know at least
[40:08] four years now my clients who want to
operate in Utah and want to get that
[40:13] Utah mortgage entity license have been
looking for originators who can qualify
[40:19] for a the PLM license. But this just not
possible because their originators are
[40:25] business purpose originators. And when
you do business purpose loans, you are
[40:29] not going to have your, you know,
license on the HUD or you don't have to
[40:34] report on MCRS.
>> Please, please listen to me. So I I
[40:38] understand that part.
>> The issue isn't that the originators who
[40:44] are working for Fortra or one of your
other clients can show that experience.
[40:49] The issue is there are hundreds of other
people who can do that. And instead of
[40:55] looking at the small pool that you
already are affiliated with,
[41:00] expand that and find somebody who can
can meet those requirements and step
[41:06] into the company as the PLM because they
already have the experience or they're
[41:10] willing to get it through another means.
I think that's Allison, is that what you
[41:14] were saying?
>> Yeah, I'm just saying like I don't
[41:18] » I mean,
>> but it's a separate pool.
[41:20] » It it doesn't matter. This is what I'm
saying is there is nothing stopping me
[41:24] as a PLM from going out and doing an
investment property loan. Period. The
[41:29] end.
>> Yeah.
[41:30] » So, I don't I don't know why the company
does like feels that they can't team up
[41:37] with somebody that's already in Utah or
that is willing to go get their PLM so
[41:41] that you have that licensing so you can
do the lending. That's where I can't
[41:44] figure out.
>> Absolutely. They are trying to they
[41:50] » are they only looking for business
purpose people only
[41:54] » but that's the company right that's the
company you're that you're representing
[41:58] they they're looking for business
purpose PLM right
[42:02] » all of our all of our lenders are
business purpose lenders only right they
[42:06] don't do consumer lending and so the
originators that they're hire they're
[42:10] trying to hire would you know a consumer
lending originator doesn't fit what
[42:17] they're looking for because first of
all, some of them just want to stay in
[42:20] the consumer lending world, right?
>> 50 ways to skin a cat and they can do
[42:26] business in Utah if they just team up
with a PLM in Utah.
[42:31] » And honestly, you could probably say,
"Hey, PLM, we're going to hire you for
[42:35] we're going to hire Allison for $100,000
a year and she's going to only focus on
[42:41] business purpose lending." But she may
not even be originating. She may just be
[42:44] saying, "Hey, I'm here as a PLM company,
come and start doing business under I'm
[42:49] I'm your PLM. I'm going to be able to uh
represent and re uh the requirements for
[42:55] Utah as a PLM and now I'll be your PLM.
I'll be hired by your client's company
[43:02] and now she's she can she doesn't have
to do the business purpose lending, but
[43:07] she also has that experience because
she's done hundreds of investment
[43:11] properties already. So it seems like
they could they could use someone like
[43:15] her to already step and they wouldn't
have to have that business purpose
[43:18] experience
>> and it sounds like a company wants to do
[43:22] that but or wants to do just the
business purpose thing and get an
[43:25] exception so that they can have a PLM
but I don't really
[43:30] » Yeah, I guess I don't see like why it
has to be that way and why we need to
[43:34] change a rule when they just need to
>> Yeah. I mean, my clients are having a
[43:40] hard time finding people who can
actually who meet those requirements. I
[43:45] understand that you you know, there are
probably a lot of originators out there
[43:49] who meet their experience requirement
and can show it to get that license
[43:53] approved, but my clients cannot find
them and it's, you know, they're they're
[43:58] trying. It's not for a lack of trying.
And now we're, you know, years and years
[44:02] and years in and their business in Utah
has just stalled because they cannot get
[44:06] that license. they cannot find the
person, they cannot, you know, I mean,
[44:10] we represent so many clients who want to
go into Utah and maybe five of them have
[44:16] found somebody who was able to meet
their experience requirements. And so
[44:21] now,
>> yeah,
[44:23] » where we are is trying to propose
maybe some sort of alternative
[44:29] equivalent experience to show you guys
so that they can sit for that PLM
[44:34] license. I mean they have the experience
you know you guys can audit um the the
[44:40] activity I don't know but it's not that
they don't have the experience they can
[44:43] sit they sit there and they they can
pass the exam they're knowledgeable it's
[44:47] just this experience requirement that
they get stuck with because the method
[44:52] that you guys are requiring it does not
fit the business purpose lending
[44:56] » and you're representing multiple lenders
that want to do the same thing right so
[45:00] like each one of these like
>> commission like each One of these would
[45:05] h I mean
would have to find a way to team up with
[45:09] APLM or more.
>> Yeah. No, I'm seeing I'm seeing the
[45:14] thing. I just I'm
>> Yeah,
[45:17] » I guess I'm not just put point out that
this has uh come up for a discussion
[45:24] just from the public comment period. We
the commission is not able to take any
[45:29] action today and maybe the the process
is um look at the uh the letter that you
[45:37] received and uh if if there's interest
in in doing something or putting that on
[45:43] an agenda in the future. It's not on the
agenda now so no action can be taken but
[45:47] it has been I think helpful to get the
information. We appreciate
[45:52] Jennifer Young coming in and and making
the case for clients. So
[45:58] » yeah,
>> I think it's probably I mean it's up to
[46:01] you chair, but I'm not sure how much
longer you want to spend on this public
[46:05] comment matter.
>> I agree with you Justin. I go ahead
[46:09] Jeeoff. Do you have more? Hey, I just
just one thing, Jennifer, I think you
[46:12] just take away. Um maybe just go back to
your clients and say why, you know,
[46:15] could would you be willing to open it up
to other PLMs without specifically and
[46:20] strictly business experience?
>> Oh, I've done that.
[46:23] » Yeah. No, I've done that. I'm like,
please just go find someone. I don't
[46:26] know who who
[46:31] » I even have I even have a list of every
PLM licensed with the state of Utah. I
[46:37] can even email that direct list to you
directly if you would like. But
[46:41] » um
>> but those PLMs can only work for one
[46:44] company, right? Because that sponsorship
from the company is unique. So they
[46:47] can't be a PLM for both companies.
>> That is true.
[46:50] » And so once they're PLM for a company,
they can't
[46:54] » it's not even just the uh PLMs that are
already licensed. There are thousands of
[47:00] MLOs's that have the required experience
and all they would need is to so it
[47:06] expands the pool. It's a huge pool.
There seems like there should be a
[47:12] handful that would be willing to expand
their business
[47:16] » uh into business purpose loans. It's
just a matter of going through that list
[47:21] and contacting them and finding who
might be willing to do that.
[47:26] » Yes. And that's my, you know, first
piece of advice when I have a company
[47:31] wanting to get licensed in Utah, right?
I say,
[47:35] » have they used that list? Apparently not
at this point. Uh, why don't you get the
[47:39] list from Mike and uh and and see if one
of the thousands that are on there might
[47:46] be willing to to branch out their
business and become business purpose uh
[47:52] originators.
So, would this be poaching originators?
[47:57] I don't want my clients to be poaching
other originators.
[48:00] » That happens all the time.
>> That happens all the time.
[48:03] [laughter]
>> I've been here almost 12 years and I've
[48:08] given this list out dozens of times. So,
it's not
[48:11] » there's not a day that doesn't go by
where we are recruited by someone else.
[48:14] » Recruiting is like
>> completely normal. I mean, if
[48:20] » everybody wants more money, so
[laughter]
[48:25] it's just a matter of finding the right
person. But I know I understand your
[48:28] frustration, Jennifer, and I appreciate
and understand, you know, where you're
[48:32] coming from on this. So, um, just like I
say, my from what we do, what I try and
[48:38] do, I try and be as open as possible to
all my applicants that come in. That's
[48:43] why I offer have offered to um if they
don't have loans that I can verify on
[48:50] the NMLS, you know, send me the files or
send me the applications with that. But
[48:55] again, the the the the originator has to
be the person that did the loan. It
[49:01] can't be signed off on by a company,
unfortunately.
[49:06] » Well, I mean, obviously, a company is
not going to be the one that's
[49:09] originating, right? They probably they
have to have an actual individual doing
[49:12] the origination and the company's just
listed. Is there something is there like
[49:16] an additional step that we can add to
show you documentation wise that there
[49:21] was an individual that was associated
with all of these loans? I mean I'm you
[49:26] know
>> are you servicing your Jennifer? Are you
[49:29] servicing these loans? How how do you
what process do you guys go through once
[49:32] the loan is completed? Where does it go?
Is it being serviced by your own
[49:36] individual companies or
>> I think some of them do service their
[49:41] own loans. Others use, you know, third
party loan serer like an FCI or
[49:45] something.
>> So nothing like a consumer company,
[49:51] Wells Fargo, any of those like places.
Okay.
[49:55] » Yeah.
>> Okay.
[49:57] » Okay. No.
>> And Mike, the
[50:02] » the PLM does not have to continue to
originate. They could just act as a PLM.
[50:06] They don't have to
>> It's like a It's like a processing
[50:10] company. If they want to be a proc open
a processing company with the state and
[50:14] have in-house processors that are paid
via W2, they still need a lending
[50:19] manager, but that lending manager just
acts as a supervisor. But again, they
[50:24] have to have a lending manager that has
prerequis.
[50:30] » Okay, that's good.
>> Hey, Jennifer, thanks for coming. We
[50:34] appreciate it.
>> Yeah, thank you.
[50:36] » Um, thank you guys. So, I mean, we we
would love to keep on working with you
[50:40] guys to maybe figure out whatever
documentation or safeguards you guys
[50:43] believe are appropriate. Um, thank you
for your time. And will you send me that
[50:47] list, Mike, of originators potentially?
Um, and then would it be possible if we
[50:53] send you documentation and then kind of
work through, you know, because I do
[50:58] have quite a number of applicants that
are looking to get licensed in Utah and
[51:04] I want to figure out a way for them.
>> Uh, yeah. Um, I would need to get with
[51:11] my people first to see, you know, what
it is that we're we want to see on that,
[51:15] but I can certainly get that list to you
uh today.
[51:19] » Yeah. Thank you. I'm happy to chat
through, you know, whatever it is that
[51:22] you guys think you might need and we
can, you know, go from there.
[51:26] » Okay.
>> Do you have her email address, Mike?
[51:29] » I might, but if you want to, uh, you
might have my email address. I'm not
[51:34] sure if you do or not. Do you
>> just Mike pageutah?
[51:39] So,
>> okay. If you want to just send me a
[51:42] short email and I'll respond back to
that.
[51:44] » Okay. And then so just for my um my
understanding, are we is this matter
[51:50] considered closed or are we still are
you guys still open to kind of maybe
[51:55] working together in finding some sort of
verification meth meth method that
[52:00] works?
[52:05] » I'm I'm not sure if we got that.
>> We have discussed that
[52:10] » that I'm not sure. That's up to the
commission.
[52:14] » Yeah. And also, Director Vead's not here
today. Uh, so we can do that. Jennifer,
[52:20] please stay in touch still and and let's
uh maybe this uh
[52:27] list and and searching out a potential
PLM might might solve your problems. If
[52:33] not, let's uh
re uh look at this down the road.
[52:41] » That sounds good. Thank you. And I will
tell you that it's not been working, but
[52:45] I mean that's why we're here. But I
appreciate it.
[52:48] » Appreciate your time.
>> All right.
[52:50] » Thank you guys.
>> Thank you.
[52:54] » Okay, let's uh move into our uh
executive closed session for the matter
[52:59] of white glass lending if we could.
Hey, so you'll need a a uh motion to
[53:09] uh enter an an executive session and and
vote on that and then I have something
[53:14] that I can read as a prerequisite to
entering that close session.
[53:20] » Uh if we could get a motion to uh move
into a closed session in discussion of
[53:26] the matter of white class lending.
>> Make a motion to do that.
[53:32] I'll second. Second.
>> Thank you.
[53:36] » I can read it in.
>> All in favor?
[53:39] » I I
>> Thanks, Jeff. [laughter]
[53:45] » After you, Jeff.
>> Uh, let the record show the following
[53:48] commission members have voted to close
this meeting for the sole purpose of
[53:52] discussing the character, professional
competence, or [snorts] physical and
[53:55] mental health of an individual. Chair
Flinton, Commission members Olsen,
[53:59] England, and Vale.
[54:04] And the breakout room just started
[1:04:55] Okay,
everyone back.
[1:05:02] Okay. Regarding Yeah. Regarding the uh
stipulation,
[1:05:07] uh do I have a motion to accept the
stipulation as written?
[1:05:12] » I may make that motion.
>> And a second.
[1:05:17] » I'll second it.
>> Does the commission concur?
[1:05:24] » So, uh Jeff, what you want to do is ask
for a vote on the motion. Oh, could I
[1:05:28] get a vote on the motion?
>> Do I just
[1:05:33] » I'm in favor.
>> In favor?
[1:05:35] » Yes. I'm in favor.
>> Okay.
[1:05:39] » Does the commission concur?
>> Yes, the uh the division concurs with
[1:05:43] the action.
Thank you.
[1:05:50] » Okay.
[1:05:53] » Well, that will uh that will conclude
our our meeting today. Um, appreciate
[1:05:58] everyone coming and and participating
and we'll adjourn to looks like October
[1:06:03] 7th would be our next one. And if I'm
not mistaken, Justin, is that one in
[1:06:07] person?
>> I apologize, I did not check that. There
[1:06:12] is one per year that we do in person.
Uh, I'll check with Lee and we'll make
[1:06:16] sure you know that. That could be the
October meeting because it's been a
[1:06:20] while since we were in person.
>> So, no shorts and t-shirt is what you're
[1:06:24] recommending then.
We won't tell you how to cry.
[1:06:31] » Okay. Well, thank you. We appreciate
you.
[1:06:34] » All right. Thank you for your time.
>> Have a great day. Thank you.
[1:06:37] » Bye, everyone.
>> Thank you.
[1:06:39] » Bye now.