Maryland Legal Alert for Financial Services

MARYLAND LEGAL ALERT keeps you updated on Maryland legal developments affecting financial services providers. If you would like more information about the items in this issue, please click on the specified links or contact any member of the Financial Services Practice Group. Learn more about Gordon Feinblatt by clicking here.
In this issue:
• UPDATE: MANDATORY ELECTRONIC FILING OF NOTICES OF INTENT TO FORECLOSE
• REQUIRED MARYLAND NOTICE OF HOUSING COUNSELING BEGINS
• CHANGES TO TRUTH IN LENDING CLOSED-END DISCLOSURES COMING SOON
• PEOPLE ARE CALLING ABOUT . . . JANUARY COMPLIANCE DEADLINES
UPDATE: MANDATORY ELECTRONIC FILING OF NOTICES OF INTENT TO FORECLOSE
Beginning January 15, 2011, Notices of Intent to Foreclose, a pre-foreclosure notice mandated for Maryland "residential property," must be submitted electronically to the Commissioner of Financial Regulation. An advisory dated December 15, 2010 provides guidance on this electronic filing procedure. To log in and begin registration, go to the Commissioner's home page and click "Notice of Intent (NOI) to Foreclose Electronic Reporting" in the Online Services box (upper right). If you have any questions about the new process, please contact Margie Corwin.

REQUIRED MARYLAND NOTICE OF HOUSING COUNSELING BEGINS
Beginning January 1, 2011, lenders making first mortgage loans primarily for personal, family or household purposes secured by owner-occupied Maryland real property or dwellings must provide borrowers with a written notice about housing counseling. The notice requirement does not apply to, among others, open-end credit, construction loans, loans to certain family members, and loans where another law requires the lender to refer borrowers to housing counseling (e.g., reverse mortgage loans). Regulations implementing this requirement, found at COMAR 05.19.01, require this notice to be provided "within 10 business days after initial application" which, based on similar language in other Maryland laws, may be interpreted as 10 business days after a consumer report is obtained. The final notice and the current list of counseling agencies can be found here. Please contact Margie Corwin if you would like to discuss this new notice requirement.

CHANGES TO TRUTH IN LENDING CLOSED-END DISCLOSURES COMING SOON
Beginning at the end of January 2011, creditors who make closed-end consumer mortgage loans will need to update their Truth in Lending Act disclosure statement to add a new tabular disclosure regarding payments. A new statement also must be included among the TILA disclosures advising consumers that there is no guarantee they can refinance their loans. Interim rules regarding these disclosures were published on September 24, 2010. Clarifying changes to these rules were published on December 29, 2010. Creditors should start testing their disclosure systems now to ensure they are ready for these TILA changes. Contact Margie Corwin if you have any questions or concerns about implementing these new disclosures.

PEOPLE ARE CALLING ABOUT . . . JANUARY COMPLIANCE DEADLINES
The January 1 compliance deadline has come and passed for: new safe harbor notice format for federal Gramm-Leach-Bliley privacy notices; risk-based pricing notice under the FACT Act; and beginning of enforcement by the FTC of the Red Flags Rules. Have you implemented these new programs through all the hustle and bustle of the holidays? If you are having difficulty getting up to speed with these new compliance requirements, give us a call, we would be happy to assist you. Please contact John Morton with questions or for help.