HB 1667 -- Missouri Homeowners' Protection Act

Sponsor:  Harris (23)

This bill establishes the Missouri Homeowners' Protection Act
relating to residential mortgage brokers.  In its main
provisions, the bill:

(1)  Defines "creditor," "flipping a home loan," "fully indexed
rate," "points and fees," "subprime loan," and "total loan
amount";

(2)  Prohibits a mortgage broker from:

(a)  Engaging in the unfair act of flipping a home loan;

(b)  Issuing a home loan without verifying the borrower's
reasonable ability to pay;

(c)  Charging a fee when a subprime loan is prepaid in whole or
part;

(d)  Making false, deceptive, or misleading statements,
advertisements, or marketing materials;

(e)  Issuing a residential mortgage loan to be used for paying
all or part of a special mortgage unless the borrower has
obtained written certification from an authorized independent
loan counselor on the advisability of the loan transaction;

(f)  Charging points or fees exceeding 5% of the total loan
amount; and

(g)  Financing credit life, disability, unemployment, property
insurance, or any other life or health insurance premiums through
a home loan;

(3)  Requires the mortgage broker to inform the borrower when the
periodic payment amount for a loan does not include property
taxes or hazard insurance;

(4)  Requires mortgage brokers to act in the borrower's best
interest, to carry out lawful instructions of the borrower, and
to disclose material facts that could adversely affect the
borrower;

(5)  Allows a borrower to a private right of action for damages
caused by a mortgage broker; and

(6)  Specifies that the crime of residential mortgage fraud will
be a class D felony.

Missouri House of Representatives
94th General Assembly, 2nd Regular Session
Last Updated October 15, 2008 at 3:10 pm