Florida Statutes 494.0023 – Conflicting interest
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(1) If, in a mortgage transaction, a licensee has a conflicting interest as specified in subsection (2), the licensee shall, at a minimum, provide the following disclosures to the borrower in writing:
(a) The nature of the relationship, ownership, or financial interest between the provider of products or services, or business incident thereto, and the licensee making the referral;
Terms Used In Florida Statutes 494.0023
- Borrower: means a person obligated to repay a mortgage loan and includes, but is not limited to, a coborrower or cosignor. See Florida Statutes 494.001
- Commission: means the Financial Services Commission. See Florida Statutes 494.001
- Mortgage: The written agreement pledging property to a creditor as collateral for a loan.
- person: includes individuals, children, firms, associations, joint adventures, partnerships, estates, trusts, business trusts, syndicates, fiduciaries, corporations, and all other groups or combinations. See Florida Statutes 1.01
- Relative: means any of the following, whether by the full or half blood or by adoption:(a) A person's spouse, father, mother, children, brothers, and sisters. See Florida Statutes 494.001
- Settlement: Parties to a lawsuit resolve their difference without having a trial. Settlements often involve the payment of compensation by one party in satisfaction of the other party's claims.
- Truth in Lending Act: The Truth in Lending Act is a federal law that requires lenders to provide standardized information so that borrowers can compare loan terms. In general, lenders must provide information on Source: OCC
- writing: includes handwriting, printing, typewriting, and all other methods and means of forming letters and characters upon paper, stone, wood, or other materials. See Florida Statutes 1.01
(b) An estimated charge or range of charges generally made by such a provider;(c) That a financial benefit may be received by the licensee as a result of the conflicting interest; and(d) That alternative sources may be chosen by the borrower to provide the required products or services.
(2) A licensee has a conflicting interest if:
(a) The licensee or the licensee’s relative provides the borrower with additional products or services;
(b) The licensee or licensee’s relative, directly or indirectly, owns, controls, or holds with power to vote, or holds proxies representing, 1 percent or more of any class of equity securities or other beneficial interest in the person providing the additional products or services;
(c) The person providing the additional products or services, directly or indirectly, owns, controls, or holds the power to vote, or holds proxies representing, 1 percent or more of any class of equity securities or other beneficial interest in the licensee;
(d) A holding company, directly or indirectly, owns, controls, or holds with power to vote, or holds proxies representing, 1 percent or more of any class of equity securities or other beneficial interest in both the licensee and the person providing the additional products or services;
(e) One or more persons, or such person’s relative, sits as an officer or director, or performs similar functions as an officer or director, for both the licensee and the person providing the additional products or services; or
(f) The licensee or the licensee’s relative sits as an officer or director, or performs similar functions as an officer or director, of the person providing the additional products or services.
(3) The commission may adopt rules to administer the disclosure requirements of this section. The rules must consider the disclosure requirements of the federal Real Estate Settlement Procedures Act, 12 U.S.C. ss. 2601 et seq.; the federal Truth in Lending Act, 15 U.S.C. ss. 1601 et seq.; and related federal regulations.