SECTION 1: Chapter 255E of the General Laws as appearing in the 2014 Official Edition is hereby amended as follows:
SECTION 2: by inserting at the end of Section 1 the following:
“bona fide nonprofit affordable homeownership organization”, a Massachusetts nonprofit corporation with a primary purpose of helping qualified low-income individuals build, repair and purchase affordable housing.
SECTION 3: by inserting after the first paragraph in Section 2, the following paragraph:
The Commissioner may issue an exemption from the provisions of this chapter and from the first mortgage lien provisions of the federal Secure and Fair Enforcement for Mortgage Licensing Act of 2008 (known as “the Safe Act”) to any bona fide affordable homeownership organization upon its application for an exemption. Such application shall be approved upon the Commissioner’s determination that the organization satisfies the following criteria:
(a)The organization is a Massachusetts nonprofit corporation with a primary purpose of helping qualified low-income individuals build, repair and purchase affordable housing;
(b)The organization is exempt from federal income taxation under Section 501(c)(3) of the Internal Revenue Code;
(c)The organization does not charge loan origination fees;
(d)The organization does not provide mortgage loans which do not fully amortize over the term of the notes they secure (known as “balloon mortgages);
(e)The organization does not compensate any employees based on the number and/or size of mortgage loans originated by the employee.
The issuance of an exemption by the Commissioner shall be in writing and shall be granted for a 5-year period. The Division of Banks may periodically monitor exempted organizations to confirm they remain in compliance with the provisions of this chapter.
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