A new bill was enacted in Washington, D.C. relating to mortgage brokers, lenders and originators. The new bill, which is titled Bill 133, has developed into law as it passed the Congressional review time without any action from Congress. The bill is indistinguishable from the emergency act that was enacted close to the conclusion of 2008 for mortgage brokers, lenders and originators, permanently implementing the Mortgage Lender and Broker Emergency Amendment Act of 2008; it applied a net worth requirement to mortgage brokers as well as the license bond requirement under present law. The Emergency Amendment Act also allows the broker to pay into a recovery fund as the Commissioner of the Department of Insurance, Securities and Banking precribes in place of meeting the net worth and bonding requirements. The SFAA effectively had Bill 133 altered to bound the surety’s liability to the penal sum of the surety bond despite of the amount of years the surety bond stays in effect, the amount of premiums paid, the amount of renewals of the license, or the amount of claims filed. Bill 133 also authorizes direct actions on the surety bond. The new bill became active after receiving approval from Congress on July 18th, 2009.

Time-share developers in Connecticut must abide by a new law titled SB 897. The new law regulates time-shares in Connecticut, asking developers to put all advance deposits collected from a potential buyer of a time-share in an escrow or trust account. In place of an escrow account, SB 897 permits the Commissioner of Consumer Protection to allow a surety bond, irrevocable letter of credit, or other assurance. If the construction is complete on the time-share, the surety bond has to be in a quantity equivalent or greater than the quantity of funds that would otherwise be deposited. The surety bond may be for the amount previously stated or in an amount that secures the completion of all guaranteed accommodations including all furniture, fixtures and other promised enhancements if the project is not yet finished. SB 897 becomes active on January 1st, 2010.

Introduced in January of 2009, is a new Colorado bill pertaining to exchange facilitators. The new bill which is titled HB 1254 states a list of activities and actions that are deceiving trade practices for any individual that is licensed as an exchange facilitator. Among the misleading trade practices are failures to sustain sufficient financial assurance, errors and omissions insurance or deposits. This requires the exchange facilitator to obtain a $1 million fidelity bond and a $250,000 errors & omissions policy; what is also adequate is a deposit cash or letters of credit (LOC) in an amount equivalent to the two insurance policies or deposit all exchange funds in an escrow account that demands the signature of the exchange facilitator and the taxpayer to extract any funds. HB 1254 was enacted on 04/16/2009.