Section 51.505 - Eligibility(a) Application of Finance Code Chapter 156, Subchapter F. Finance Code § 156.555(b), adopts by reference the eligibility and procedural requirements for making a claim on the Commissioner's recovery fund in accordance with Finance Code Chapter 156, Subchapter F. This section clarifies how certain of such requirements apply to a claim made on the Mortgage Grant Fund in accordance with Finance Code § 156.555.(b) Actions by an Unlicensed Individual Acting as an Originator. To be eligible to recover from the Mortgage Grant Fund, the individual alleged to have caused harm to the claimant must have been acting or attempting to act in the capacity of an originator - actions for which a license under Finance Code Chapter 157 was required as provided by Finance Code § 157.012 and § RSA 81.100 of this title (relating to Licensing - General).(c) Fraudulent Acts. Recovery under Finance Code § 156.555 is limited to acts of fraud committed by an individual who acted as a residential mortgage loan originator but who did not hold the license required by Finance Code Chapter 157. Finance Code §156.501(b), applicable to claims made on the recovery fund, provides that recovery is limited to acts by a licensed originator that constitute a violation of specific, enumerated provisions of Finance Code §§ RSA 157.024(a) and RSA 156.304(b). As a result, in order to recover under Finance Code § 156.555, a claimant must establish that the acts of the unlicensed individual, had he or she been licensed as a residential mortgage loan originator at the time of such acts, would have constituted fraudulent dealings for purposes of Finance Code § RSA 157.024(a)(3).7 Tex. Admin. Code § 51.505
Adopted by Texas Register, Volume 47, Number 27, July 8, 2022, TexReg 3966, eff. 7/14/2022