File No. 33381
This rule was published in the March 1, 2010, issue (Vol. 2010, No. 5) of the Utah State Bulletin.
Commerce, Real Estate
Rule R162-210
Certification of Prelicensing Education Providers
Notice of Proposed Rule
(Repeal)
DAR File No.: 33381
Filed: 02/11/2010 09:51:22 AM
RULE ANALYSIS
Purpose of the rule or reason for the change:
Rule R162-210 is repealed in light of the Division's proposed new Rule R162-2c, which updates the mortgage education certification rules to comply with the nationwide database. (DAR NOTE: The proposed new Rule R162-2c is under DAR No. 33372 in this issue, March 1, 2010, of the Bulletin.)
Summary of the rule or change:
Rule R162-210 is repealed in its entirety.
State statutory or constitutional authorization for this rule:
- Subsection 61-2c-103(3)
Anticipated cost or savings to:
the state budget:
Repealing this rule relieves the state from having to oversee and enforce it. The costs to the state of implementing and overseeing the new education certification rules are included in the rule analysis for proposed new Rule R162-2c.
local governments:
Local governments do not take, provide, or oversee mortgage prelicensing education and have never been subject to the rules governing it. Repealing this rule will have no fiscal impact to local governments.
small businesses:
Businesses that provide prelicensing education no longer have to comply with this rule. The costs to them of complying with the new rule governing prelicensing education are addressed in the rule analysis for proposed new Rule R162-2c.
persons other than small businesses, businesses, or local governmental entities:
Individuals teaching prelicensing education courses no longer have to comply with this rule. The costs to them of complying with the new rule governing prelicensing education are addressed in the rule analysis for proposed new Rule R162-2c.
Compliance costs for affected persons:
In repealing this rule, the division relieves affected persons of any obligation to comply with it. There are no compliance costs.
Comments by the department head on the fiscal impact the rule may have on businesses:
No fiscal impact to businesses is anticipated from this rule repeal as a substitute rule amendment containing the substance of these provisions is also proposed by the Division.
Francine A. Giani, Executive Director
The full text of this rule may be inspected, during regular business hours, at the Division of Administrative Rules, or at:
CommerceReal Estate
160 E 300 S
SALT LAKE CITY, UT 84111-2316
Direct questions regarding this rule to:
- Jennie Jonsson at the above address, by phone at 801-530-6706, by FAX at 801-526-4387, or by Internet E-mail at [email protected]
Interested persons may present their views on this rule by submitting written comments to the address above no later than 5:00 p.m. on:
03/31/2010
This rule may become effective on:
04/07/2010
Authorized by:
Deanna Sabey, Director
RULE TEXT
R162. Commerce, Real Estate.
[R162-210. Certification of Prelicensing
Education Providers.
R162-210-1. Definitions.
210.1.1 For the purposes of this rule, "school"
includes:
(a) Any college or university accredited by a regional
accrediting agency which is recognized by the United States
Department of Education;
(b) Any community college, vocational-technical school,
state or federal agency or commission;
(c) Any nationally recognized mortgage organization, any
Utah mortgage organization, or any local mortgage organization
which has been approved by the Utah Residential Mortgage
Regulatory Commission; and
d) Any proprietary mortgage education school.
210.1.2 For the purposes of this rule, "applicant"
shall include school directors, school owners and pending
instructors.
210.1.3 "Distance Education" is defined as
education in which the instruction does not take place in a
traditional classroom setting, but rather through other media
where teacher and student are separated by distance and sometimes
by time.
R162-210-2. Application for School
Certification.
210.2.1 A school offering prelicensing education must be
certified by the Division of Real Estate before providing any
education. Each school requesting approval of an educational
program designed to meet the prelicensing education requirements
must make application for approval on the form prescribed by the
Division. The application must include the non-refundable
application fee and the following information which will be used
in determining the school's eligibility for approval:
(a) Name, phone number and address of the school, school
director, and all owners of the school;
(b) A description of the type of school and a description of
the school's physical facilities. All courses must be taught
in an appropriate classroom facility and not in any private
residence, except for courses approved for specific home-study
purposes;
(c) A comprehensive course outline including a description
of the course, the length of time to be spent on each subject
area broken into class periods, and a minimum of three to five
learning objectives for every three hours of classroom time. The
curriculum must include all of the topics set forth in the
Standard Curriculum approved by the Utah Residential Mortgage
Regulatory Commission and the Division. A school may alter the
sequence of presentation of the required topics, and may add
topics in addition to those required by the Standard
Curriculum;
(d) A list of each certified instructor the school intends
to use and the instructor certification number which has been
issued by the Division. A college or university may use any
faculty member to teach an approved course provided the
instructor demonstrates to the satisfaction of the Division the
academic training or experience qualifying him to teach the
course;
(e) An itemization of methods of instruction, including
lecture method, slide presentation, cassette, videotape, movie,
or other method;
(f) A list of the titles, authors and publishers of all
required textbooks. All texts, workbooks, supplement pamphlets
and any other materials must be appropriate and current in their
application to the required course outline;
(g) A schedule of the days, times and locations of
classes;
(h) A copy of the statement which shall be provided for each
student outlining the days, times and locations of classes; the
number of quizzes and examinations; the grading system, including
methods of testing and standards of grading; the requirements for
attendance; the school's evidence of notification to
candidates of the qualifying questionnaire; and the school's
refund policy. The statement to the student shall state in
capital letters no smaller than 1/4 inch the following language:
"Any student attending the (school name) is under no
obligation to affiliate with any of the mortgage entities that
may be soliciting for licensees at this school;" and
(i) Any other information as the Division may require.
R162-210-3. School Certification and
Renewal.
210.3.1 When a school has met all conditions of
certification, and upon approval by the Division, a school will
be issued certification. A school certification will expire 24
months from the date of issuance. A school shall apply for
renewal for additional twenty-four month periods prior to the
expiration of each current certification, using the form required
by the Division.
R162-210-4. Rules of Conduct for Certified
Schools.
210.4.1 A school shall teach the approved course of study as
outlined in the Standard Course Outline approved by the Utah
Residential Mortgage Regulatory Commission.
210.4.2 A school shall require each student to attend the
required number of hours.
210.4.3 A school shall maintain a record of each
student's attendance for a minimum of five years after
enrollment.
210.4.4 A school shall not accept a student for a number of
hours that is less than the full prelicensing curriculum without
first having a written statement from the Division indicating the
exact number of hours that an applicant for licensure by
reciprocity is required by the Division to complete.
210.4.5 A school shall not make any misrepresentation in its
advertising about any course of instruction, and shall be able to
provide substantiation of any claims made in its advertising.
School advertising and public notices shall not denigrate the
mortgage profession and shall not make disparaging remarks about
a competitor's services or methods of operation.
210.4.6 Guest Lecturers. No more than 20% of the required
prelicensing education hours may be provided by guest lecturers.
Guest lecturers shall be experts in the field on which they
provide instruction. Prior to using any guest lecturer, a
certified school shall provide to the Division the name of the
guest lecturer and a resume which defines the knowledge and
expertise of the guest lecturer, or other evidence of
professional qualifications of the guest lecturer.
210.4.7 Minimum class time. A school shall not give a
student credit for more credit hours of education than the
student has actually completed. A credit hour is defined as 50
minutes of instruction within a 60 minute time period. A 10
minute break will be given for each 50 minutes of
instruction.
210.4.8 Maximum class hours per day. Education credit will
be limited to a maximum of eight credit hours per day.
210.4.9 Limitation on Non-lecture Methods of Instruction.
Absent special approval from the Division: (a) Non-lecture
methods of instruction will be limited to 50% of the total credit
hours of the prelicensing curriculum; (b) Non-lecture methods of
instruction will have an accompanying workbook for the student to
complete during the instruction. The schools shall submit copies
of the workbooks to the Division prior to using a non-lecture
method of instruction; and (c) A school must have a certified
instructor available to answer student questions within 48 hours
after a non-lecture method of instruction has been used.
210.4.10 Proof of Course Integrity for Distance Education
Courses. Distance education courses will be reviewed on a case by
case basis and will be approved only if, in the opinion of the
Division, assurance of the following can be provided: a) There is
a method to insure that the person actually completing the course
is the student who is to receive credit for the course; b) The
course provides no fewer hours of actual instruction than the
number of credit hours that will be granted for the course; and
c) There is a method to insure that the student comprehends the
material.
210.4.11 Challenge by Examination. A student cannot
challenge a course or any part of a course of study by
examination in lieu of attendance at the course.
210.4.12 College Credit Hour Equivalents. A college or a
university that provides Division-approved prelicensing education
courses may schedule those courses within its regular quarter or
semester schedule. A college quarter hour credit is the
equivalent of 10 classroom hours of prelicensing education, and a
college semester hour credit is the equivalent of 15 classroom
hours of prelicensing education.
210.4.13 Within 15 calendar days after the occurrence of any
material change in the information provided in the school's
application for certification, the school shall give the Division
written notice of that change.
210.4.14 A school shall not attempt by any means to obtain
or to use in its educational offerings the questions from the
prelicensing examination unless the questions have been dropped
from the current bank of exam questions.
210.4.15 A school shall not give any valuable consideration
to an individual or entity licensed with the Division under the
Utah Residential Mortgage Practices Act for having referred
students to the school, nor shall a school accept valuable
consideration from an individual or entity licensed with the
Division under the Utah Residential Mortgage Practices Act for
having referred students to a licensed mortgage entity.
210.4.16 Licensed mortgage entities may be permitted by a
school to solicit prospective mortgage officers at the school,
provided that no solicitation may be made during the class time
or the 10-minute breaks that are permitted during every hour of
instruction. Such solicitation may be made only after the
regularly scheduled class time has concluded. No student may be
required to attend any such solicitation.
210.4.17 A school shall use only certified instructors or
guest lecturers. The school shall notify the Division about which
class sessions the guest lecturers will teach.
210.4.18 A school's owners and directors shall be
responsible for the quality of instruction in the school and for
adherence to the state laws and regulations regarding school and
instructor certification.
210.4.19 School directors shall provide the instructor for
each course with the required content outline for the course and
shall assure that the required subject matter has been
taught.
210.4.20 Disclosure Requirements Regarding Criminal History.
For the purposes of this rule, criminal history is defined as any
felony or misdemeanor convictions, any pleas in abeyance or
diversion agreements, or any pending criminal charges.
210.4.20.1 Prior to accepting payment from a prospective
student for a pre-licensing education course, a certified school
shall provide a written disclosure to the prospective student
stating: a) applicants for licensure must disclose any criminal
history by answering a questionnaire as part of the mortgage
exam; b) applicants for licensure must submit fingerprint cards
to the Division and consent to a criminal background check; c)
licenses issued by the Division are conditional pending the
completion of the background check and failure to accurately
disclose a criminal history will result in an immediate and
automatic license revocation; d) applicants with a criminal
history described in Subsection R162-202-5(202.5.1) do not
qualify for a license; and e) applicants with a criminal history
other than as described in Subsection R162-202-5(202.5.1) will be
considered on a case-by-case basis and may be required to appear
at an administrative hearing to determine qualifications for
licensure.
210.4.20.2 The school shall be required to obtain the
student's signature on the written disclosure required by
Section 210.4.20.1 acknowledging receipt of the disclosure. The
disclosure form and acknowledgement shall be retained in the
school's records and made available for inspection by the
Division for a minimum of two years following the date upon which
the student completes the pre-licensing course.
R162-210-5. Instructor Application for
Certification.
210.5.1 An instructor shall not teach a prelicensing course
by himself without having been certified by the Division prior to
teaching the course. Each applicant for certification as a
prelicensing instructor shall make application for approval on
the form required by the Division.
210.5.2 The applicant for instructor certification to teach
Mortgage Officer prelicensing courses shall provide:
(a) Evidence of a minimum educational level of graduation
from high school or its equivalent;
(b) Evidence of a minimum of five years of experience in the
residential mortgage industry within the past ten years, or
evidence of having completed appropriate college-level courses
specific to the topic proposed to be taught;
(c) Evidence of a minimum of twelve months of fulltime
teaching experience or an equivalent number of months of part
time teaching experience, or attendance at Instructor Development
Workshops totaling at least two days in length; and
(d) Evidence of having passed an examination designed to
test the knowledge of the subject matter proposed to be
taught.
210.5.3 Lending Manager Prelicensing Courses. In addition to
the requirements of Section 210.5.2, an applicant for
certification to teach the following specific Lending Manager
prelicensing courses shall have experience as follows:
210.5.3.1 Management of a Residential Mortgage Loan Office.
An applicant for certification to teach office management courses
must be have at least two years practical experience in managing
an office that engaged in the business of residential mortgage
loans.
210.5.3.2 Mortgage Lending Law. An applicant to teach
mortgage lending law courses must be a current member of the Utah
Bar Association or have graduated from an American Bar
Association accredited law school, and must have at least two
years practical experience in the field of real estate law.
210.5.3.3 Advanced Appraisal. An applicant to teach advanced
appraisal courses must be a State-Certified appraiser and must
hold an MAI designation or equivalent designation. The instructor
applicant must have at least two years practical experience in
appraising.
210.5.3.4 Advanced Finance. An applicant to teach advanced
finance courses must have been associated with a lending
institution as a loan officer or have a degree in finance. The
instructor applicant must have at least two years practical
experience in real estate finance.
210.5.4 Special Circumstances. Instructor applicants who
cannot meet the requirements of Section 210.5.2, but who believe
they are qualified to be certified as instructors, may petition
the Utah Residential Mortgage Regulatory Commission on an
individual basis for evaluation and approval of their
qualifications as being substantially equivalent to those
required for instructor certification.
R162-210-6. Instructor Certification and
Renewal.
210.6.1. Upon approval by the Division, an instructor
applicant will be issued a certification that expires twenty-four
months following certification. An instructor shall apply for
renewal for additional twenty-four month periods prior to the
expiration of each current certification, using the form required
by the Division.
210.6.2. As a condition of renewal of certification, the
applicant shall include the following with the application for
renewal:
(a) Proof of having taught at least 20 hours of in-class
instruction in a certified mortgage education course during the
preceding two years;
(b) Proof of attendance at an instructor development
workshop sponsored by the Division during the preceding two
years; and
(c) Proof of successful completion of 12 hours of live
education courses taken in real estate financing related
subjects;
210.6.3 A renewed certification will be issued for two full
calendar years, expiring on December 31 of the second calendar
year.
210.6.4 If an application for renewal of instructor
certification, including all required fees and documentation, is
not received prior to the expiration date of the current
instructor certification, the instructor certification shall
expire.
210.6.4.1 When an instructor certification expires, the
certification may be reinstated for a period of thirty days after
the expiration date of the certification upon payment of a
non-refundable late fee in addition to completion of the
requirements for a timely renewal.
210.6.4.2 After the thirty day period, and until three
months after the expiration date, an instructor certification may
be reinstated upon payment of a non-refundable late fee and
completion of 6 classroom hours of education related to
residential mortgages or teaching techniques in addition to
completing all of the requirements for a timely renewal. After
the three month period, an instructor will be required to apply
as for an original certification.
R162-210-7. Determining Fitness for
Certification.
210.7.1 In order to qualify for school certification, all
school directors and all owners of the school must meet the
criteria of honesty, integrity, truthfulness, reputation, and
competency. In order to qualify for instructor certification, all
instructors must meet the criteria of good moral character,
honesty, integrity, truthfulness, reputation, and
competency.
210.7.2 The determination of whether a person possesses
these qualifications will be made by the Division, with the
concurrence of the Commission. In determining fitness for
certification, the Division and Commission may consider various
factors, including:
(a) whether the person has had a license to practice in the
mortgage profession, or any other regulated profession or
occupation denied, restricted, suspended, or revoked or subjected
to any other disciplinary action by this or another
jurisdiction;
(b) whether the person has been permitted to resign or
surrender a mortgage license or any other professional license or
has ever allowed a license to expire while the applicant was
under investigation, or while action was pending against the
applicant by a mortgage licensing or any other regulatory
agency;
(c) whether any action is pending against the person by any
mortgage licensing or other regulatory agency;
(d) whether the person is currently under investigation for,
or charged with, or has ever been convicted of or pled guilty or
no contest to, or entered a plea in abeyance to, a misdemeanor or
felony;
(e) the circumstances that led to any criminal
convictions;
(f) the amount of time that has passed since the
individual's last criminal conviction;
(g) whether the person has ever been placed on probation or
ordered to pay a fine or restitution in connection with any
criminal offense or a licensing action;
(h) whether a civil judgment has ever been entered against
the person based on fraud, misrepresentation or deceit, and, if
the judgment awarded damaged against the person, whether the
judgment has been fully satisfied;
(i) whether any restitution ordered by a court in a criminal
conviction has been fully satisfied;
(j) whether the probation in a criminal conviction or a
licensing action has been completed and fully served;
(k) whether there has been subsequent good conduct on the
part of the person;
(l) any character testimony presented at the hearing and any
character references submitted by the individual;
(m) past acts related to honesty or moral character
involving the business of residential mortgage loans;
(n) whether the individual has been guilty of dishonest
conduct in the five years preceeding application that would have
been ground under Utah law for revocation or suspension of a
certification had the individual then been certified;
(o) whether any tax and child support arrearages have been
paid; and
(p) whether the individual has demonstrated competency in
business subsequent to any part incompetence by the individual in
the mortgage loan business.
R162-210-8. Division Evaluation and Monitoring
of Courses and Instructors.
210.8.1 The Division shall cause certified prelicensing
education courses to be evaluated for adherence to course content
and other prescribed criteria, and for the effectiveness of the
instructor.
210.8.2 On a randomly selected basis, the Division may
assign monitors to attend courses for the purpose of evaluating
the courses and the instructors. The monitors will complete a
standard evaluation form provided by the Division and return the
form to the Division within 10 days after the last class.
KEY: residential mortgage loan origination
Date of Enactment or Last Substantive Amendment: April 7, 2008
Notice of Continuation: May 27, 2009
Authorizing, and Implemented or Interpreted Law: 61-2c-103(6)]
Additional Information
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For questions regarding the content or application of this rule, please contact Jennie Jonsson at the above address, by phone at 801-530-6706, by FAX at 801-526-4387, or by Internet E-mail at [email protected].