For purposes of this chapter, the following definitions shall apply:

(1) DEPOSITORY INSTITUTION. The term “depository institution” has the same meaning as in Section 3 of the Federal Deposit Insurance Act, and includes any credit union.
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Terms Used In Alabama Code 5-26-3

  • Contract: A legal written agreement that becomes binding when signed.
  • Corporation: A legal entity owned by the holders of shares of stock that have been issued, and that can own, receive, and transfer property, and carry on business in its own name.
  • Deed: The legal instrument used to transfer title in real property from one person to another.
  • Federal Reserve System: The central bank of the United States. The Fed, as it is commonly called, regulates the U.S. monetary and financial system. The Federal Reserve System is composed of a central governmental agency in Washington, D.C. (the Board of Governors) and twelve regional Federal Reserve Banks in major cities throughout the United States. Source: OCC
  • Fixed Rate: Having a "fixed" rate means that the APR doesn't change based on fluctuations of some external rate (such as the "Prime Rate"). In other words, a fixed rate is a rate that is not a variable rate. A fixed APR can change over time, in several circumstances:
    • You are late making a payment or commit some other default, triggering an increase to a penalty rate
    • The bank changes the terms of your account and you do not reject the change.
    • The rate expires (if the rate was fixed for only a certain period of time).
  • following: means next after. See Alabama Code 1-1-1
  • Lease: A contract transferring the use of property or occupancy of land, space, structures, or equipment in consideration of a payment (e.g., rent). 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
  • National Credit Union Administration: The federal regulatory agency that charters and supervises federal credit unions. (NCUA also administers the National Credit Union Share Insurance Fund, which insures the deposits of federal credit unions.) Source: OCC
  • Partnership: A voluntary contract between two or more persons to pool some or all of their assets into a business, with the agreement that there will be a proportional sharing of profits and losses.
  • person: includes a corporation as well as a natural person. See Alabama Code 1-1-1
  • property: includes both real and personal property. See Alabama Code 1-1-1
  • Real property: Land, and all immovable fixtures erected on, growing on, or affixed to the land.
  • real property: includes lands, tenements and hereditaments. See Alabama Code 1-1-1
  • 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
  • United States: includes the territories thereof and the District of Columbia. See Alabama Code 1-1-1
(2) FEDERAL BANKING AGENCIES. The term “federal banking agencies” means the Board of Governors of the Federal Reserve System, the Comptroller of the Currency, the Director of the Office of Thrift Supervision, the National Credit Union Administration, and the Federal Deposit Insurance Corporation.
(3) IMMEDIATE FAMILY MEMBER. The term “immediate family member” means a spouse, child, sibling, parent, grandparent, or grandchild. This includes stepparents, stepchildren, stepsiblings, and adoptive relationships.
(4) INDIVIDUAL. The term “individual” means a natural person.
(5) LOAN PROCESSOR OR UNDERWRITER.

(a) In General. The term “loan processor or underwriter” means an individual who performs clerical or support duties as an employee at the direction of and subject to the supervision and instruction of a person licensed, or exempt from licensing, under the Alabama Consumer Credit Act or Mortgage Brokers Licensing Act.
(b) Clerical or Support Duties. For purposes of subsection (a), the term “clerical or support duties” may include subsequent to the receipt of an application:

(i) The receipt, collection, distribution, and analysis of information common for the processing or underwriting of a residential mortgage loan; and
(ii) Communicating with a consumer to obtain the information necessary for the processing or underwriting of a loan, to the extent that such communication does not include offering or negotiating loan rates or terms, or counseling consumers about residential mortgage loan rates or terms.
(c) Representations to the Public. An individual engaging solely in loan processor or underwriter activities, shall not represent to the public, through advertising or other means of communicating or providing information including the use of business cards, stationery, brochures, signs, rate lists, or other promotional items, that such individual can or will perform any of the activities of a mortgage loan originator.
(6) LOSS MITIGATION SPECIALIST. The term “loss mitigation specialist” means an individual employed by a lender or servicer who negotiates or renegotiates the terms of an existing loan, or assists in refinancing an existing loan when a borrower is in default, or in reasonably foreseeable likelihood of default.
(7) MORTGAGE LOAN ORIGINATOR.

(a) In General. The term “mortgage loan originator”:

(i) Means an individual who for compensation or gain or in the expectation of compensation or gain:

(A) Takes a residential mortgage loan application; or
(B) Offers or negotiates terms of a residential mortgage loan;
(ii) Does not include an individual engaged solely as a loan processor or underwriter except as otherwise provided in Section 5-26-4(3);
(iii) Does not include a person or entity that only performs real estate brokerage activities and is licensed or registered in accordance with Alabama law, unless the person or entity is compensated by a lender, a mortgage broker, or other mortgage loan originator or by any agent of such lender, mortgage broker, or other mortgage loan originator; and
(iv) Does not include a person or entity solely involved in extensions of credit relating to timeshare plans, as that term is defined in Section 101(53D) of Title 11, United States Code.
(b) Real Estate Brokerage Activity Defined. For purposes of this chapter the term “real estate brokerage activity” means any activity that involves offering or providing real estate brokerage services to the public, including:

(i) Acting as a real estate agent or real estate broker for a buyer, seller, lessor, or lessee of real property;
(ii) Bringing together parties interested in the sale, purchase, lease, rental, or exchange of real property;
(iii) Negotiating, on behalf of any party, any portion of a contract relating to the sale, purchase, lease, rental, or exchange of real property (other than in connection with providing financing with respect to any such transaction);
(iv) Engaging in any activity for which a person engaged in the activity is required to be registered or licensed as a real estate agent or real estate broker under any applicable law; and
(v) Offering to engage in any activity, or act in any capacity, described in subsections (i), (ii), (iii), or (iv) of this section.
(8) NATIONWIDE MORTGAGE LICENSING SYSTEM AND REGISTRY. The term “Nationwide Mortgage Licensing System and Registry” means a mortgage licensing system developed and maintained by the Conference of State Bank Supervisors and the American Association of Residential Mortgage Regulators for the licensing and registration of licensed mortgage loan originators.
(9) NONTRADITIONAL MORTGAGE PRODUCT. The term “nontraditional mortgage product” means any mortgage product other than a 30-year fixed rate mortgage.
(10) PERSON. The term “person” means a natural person, corporation, company, limited liability company, partnership, or association.
(11) REGISTERED MORTGAGE LOAN ORIGINATOR. The term “registered mortgage loan originator” means any individual who:

(a) Meets the definition of mortgage loan originator and is an employee of:

(i) A depository institution;
(ii) A subsidiary that is:

(A) Owned and controlled by a depository institution; and
(B) Regulated by a Federal banking agency; or
(iii) An institution regulated by the Farm Credit Administration; and
(b) Is registered with, and maintains a unique identifier through, the Nationwide Mortgage Licensing System and Registry, or if prior to the Federal Banking Agencies establishing a registration system, would be subject to registration under the registration system when established by the Federal Banking Agencies and then would maintain a unique identifier.
(12) RESIDENTIAL MORTGAGE LOAN. The term “residential mortgage loan” means any loan primarily for personal, family, or household use that is secured by a mortgage, deed of trust, or other equivalent consensual security interest on a dwelling (as defined in Section 103(v) of the Truth in Lending Act) or residential real estate upon which is constructed or intended to be constructed a dwelling.
(13) RESIDENTIAL REAL ESTATE. The term “residential real estate” means any real property located in Alabama, upon which is constructed or intended to be constructed a dwelling.
(14) SUPERVISOR. The Supervisor of the Bureau of Loans of the State Banking Department.
(15) UNIQUE IDENTIFIER. The term “unique identifier” means a number or other identifier assigned by protocols established by the Nationwide Mortgage Licensing System and Registry.
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