Subcommittee advances bill clarifying mortgage loan originator sponsorship and licensing

Delegate Pam Queen, chairing the subcommittee, said the bill (HB 38) is meant to clarify "the licensing and affiliation insurance for mortgage loan originators" so that independent agents and loan originators are properly classified for licensing.

Director Salazar of the Office of Financial Regulation told the panel OFR had "no objection to the bill" but had sent clarifying language earlier the same day to define the term "sponsor" so the office could regulate sponsored originators appropriately. According to the language discussed, "sponsor means a mortgage lender or a person who is exempt from licensing as a mortgage lender on whose behalf a licensee engages in the business of mortgage loan origination as identified in the licensee's license application." The sponsor‑definition language was described as one line of clarifying text.

Queen said the bill would allow some independent insurance agents who have performed mortgage originations to operate without being tied to a single licensed mortgage company, enabling them to work with multiple insurers while remaining subject to regulation. OFR staff confirmed the change would provide clarity for a class of originators that had not been separately designated since 2009.

Committee members agreed to move two conceptual amendments — OFR's sponsor‑definition language and an amendment the sponsor described earlier — conceptually favorable so the final amendment text can be drafted and included in a reprint before the full voting session. The motion to move the bill with the conceptual amendments was made, seconded and passed by voice vote; the measure will proceed for formal drafting and placement on a future voting agenda.

The subcommittee did not record a roll‑call tally in the transcript; the chair called for the ayes and the motion carried. The reprinted bill will show the exact amendment text before the committee takes a final, recorded vote.