The commissioner has the authority to levy assessments for the support of this part as provided for in this chapter.
Chapter 6Assessments
Section § 50400
The commissioner is empowered to charge fees to fund the activities outlined in this section.
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Section § 50401
This law impacts residential mortgage lenders or servicers in California. It states that each licensee must pay an annual fee to cover the administrative costs for this sector, which is calculated as the lesser of their share of projected costs or $15,000. The fee is based on the volume of mortgages they originate or service. Moreover, licensees must file an annual report by March 1st, detailing their mortgage activity from the previous year.
The commissioner then informs each licensee by September 30th of their assessed fee, which must be paid within 20 days. Late payments incur penalties, and failure to pay within 30 days can lead to license suspension or revocation without delay, though affected parties may request a hearing.
(a)CA Financial Code § 50401(a) In addition to other fees and reimbursements required to be paid under this division, each residential mortgage lender or servicer licensee shall pay to the commissioner an amount equal to the lesser of: (1) its pro rata share of all costs and expenses (including overhead and the maintenance of a prudent reserve not to exceed 90 days’ costs and expenses) that the commissioner reasonably expects to incur in the current fiscal year in the administration of this division and not otherwise recovered by the commissioner under this division or from the Financial Protection Fund, plus a deficit or less a surplus actually incurred during the prior two fiscal years; or (2) fifteen thousand dollars ($15,000). The pro rata share shall be the greater of either three thousand dollars ($3,000) or the sum of: (A) a number derived from the ratio of the aggregate principal amount of the mortgage loans secured by residential real property originated by the licensee to all mortgage loans secured by residential real property originated by all licensees under this division, as shown by the annual financial reports to the commissioner, which number is then multiplied by one-half of the costs and expenses estimated by the commissioner; plus (B) a number derived from the ratio of the average value of mortgage loans secured by residential real property serviced by a licensee to the average value of all mortgage loans secured by residential real property serviced by all licensees under this division, as shown by the annual financial reports to the commissioner, which number is then multiplied by one-half of the costs and expenses estimated by the commissioner. For the purposes of this section, the “principal amount” of a mortgage loan means the initial total amount a borrower is obligated to repay the lender and the “average value” of loans serviced means the sum of the aggregate dollar value of all mortgage loans secured by residential real property serviced by a licensee, calculated as of the last day of each month in the calendar year just ended, divided by 12.
In order for the commissioner to calculate the assessment under this section, each licensee shall file an annual report for the calendar year just ended containing the information required by the commissioner on or before March 1 of the year in which the assessment is to be calculated.
In determining the
amount assessed, the commissioner shall consider all appropriations from the Financial Protection Fund for the support of this division and all reimbursements provided for under this division.
(b)CA Financial Code § 50401(b) In no case shall the reimbursement, payment, or other fee authorized by this section exceed the cost, including overhead, reasonably incurred in the administration of this division, and the maintenance of a prudent reserve not to exceed 90 days’ costs and expenses.
(c)CA Financial Code § 50401(c) On or before the 30th day of September in each year, the commissioner shall notify each licensee by mail of the amount assessed and levied against it and that amount shall be paid within 20 days. If payment is not made within 20 days, the commissioner shall assess and collect a penalty, in addition to the assessment of
1 percent of the assessment for each month or part of a month that the payment is delayed or withheld.
(d)CA Financial Code § 50401(d) If a licensee fails to pay the assessment on or before the 30th day following the day upon which payment is due, the commissioner may by order summarily suspend or revoke the license issued to the licensee. An order issued under this section is not stayed by the filing of a request for a hearing. If, after an order is made, the request for hearing is filed in writing within 15 days from the date of service of the order and a hearing is not held within 60 days of the filing, the order is deemed rescinded as of its effective date. During a period when its license is revoked or suspended, a licensee shall not conduct business pursuant to this division except as may be permitted by further order of the commissioner. However, the revocation, suspension, or surrender of a license shall not affect the powers of the commissioner as provided in
this division.
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Section § 50402
This law says that if the charges and assessments collected for a year are too high or too low to cover the expenses of running the division, adjustments will be made for the next year. These adjustments will be based on the amount by which the previous year was over or under budget. The goal is to cover actual costs and to have a reserve fund covering 90 days of expenses.
Notwithstanding subdivision (a) of Section 50401, if the commissioner determines that the charges and assessments set forth in this division for any year are in excess of the amount necessary, or are insufficient, to meet the expenses of administration of this division for that year, the assessments and charges for the following year shall be adjusted on a pro rata basis in accordance with the percentage of the excess or insufficiency as related to the actual charges
and assessments for the year for which the excess or insufficiency occurred, in order to recover the actual costs of administration and provide a prudent reserve of 90 days’ costs and expenses.
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