(a) Licensees shall:

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Terms Used In Alabama Code 5-25-12

  • Interest rate: The amount paid by a borrower to a lender in exchange for the use of the lender's money for a certain period of time. Interest is paid on loans or on debt instruments, such as notes or bonds, either at regular intervals or as part of a lump sum payment when the issue matures. Source: OCC
  • Mortgage: The written agreement pledging property to a creditor as collateral for a loan.
  • Mortgage loan: A loan made by a lender to a borrower for the financing of real property. Source: OCC
  • state: when applied to the different parts of the United States, includes the District of Columbia and the several territories of the United States. See Alabama Code 1-1-1
  • writing: includes typewriting and printing on paper. See Alabama Code 1-1-1
(1) Prior to the collection of a mortgage broker fee from a borrower, disclose to the borrower in writing the nature of the mortgage broker’s relationship to the borrower and the method by which the mortgage broker will be compensated for services.
(2) Comply with applicable federal and state laws, rules, and regulations.
(b) Licensees shall not:

(1) Intentionally misrepresent or conceal a material fact, term, or condition of the transaction to which he or she is a party, pertinent to an application for a mortgage loan or a borrower.
(2) Fail to use due diligence and make reasonable efforts to procure a mortgage loan on behalf of the borrower.
(3) Fail to disburse funds in accordance with a written commitment to make a mortgage loan.
(4) Delay closing of a mortgage loan for the purpose of increasing interest rate, costs, fees, or other charges payable by the borrower.
(5) Collect any mortgage broker fees before a conditional commitment is obtained from the lender by the mortgage broker.
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