State legislatures in Georgia and Rhode Island recently amended their lending and licensing laws. The following are the noteworthy updates:


  • HB 891 creates an exception from licensure under the Georgia Residential Mortgage Act for persons holding loans for securitization into a secondary market, so long as the person holds the individual loans for less than seven days. The amendment also exempts natural persons who are under exclusive written independent contract agreements with any person that is a licensed mortgage broker, if the licensed mortgage broker meets certain criteria. The amendments became effective July 1, 2022.
  • SB 470 provides that the Georgia Department of Banking and Finance may not issue or may revoke a license or registration if it finds that the mortgage loan originator, broker, or lender, or any person who is a director, officer, partner, covered employee or ultimate equitable owner of 10% or more of the mortgage broker or lender or any individual who directs the affairs or establishes policy for the mortgage broker or lender applicant, registrant, or licensee, has been convicted of a felony in any jurisdiction or of a crime which, if committed in Georgia, would constitute a felony under Georgia law. The law took effect on May 2, 2022.

Rhode Island

  • S 2794/ H 7781 Sub A permit employees of a licensee to perform services for the licensee or act as a mortgage loan originator from a remote location, so long as (i) the employee is subject to the supervision of the licensee; (ii) there are policies and procedures, oversight, and monitoring related to employees working from remote locations; (iii) access to the licensee’s computer systems is in line with the licensee’s information security plan; (iv) no in-person customer interaction occurs at a remote location; and (v) physical business records are not maintained at the remote location. The bill is effective immediately.

The amendment also revises the term “lender” to include a person who makes or funds a “retail installment contract.” Previously, a “lender” was defined as any person who makes or funds a loan.

Putting It Into Practice: Mortgage lenders and brokers should review these recent amendments to determine whether, and if so how, the amendments impact their licensing obligations or their policies.