Real Estate Agent · Germantown, MD · Member since 2016 · 18 posts · 6 votes
Need clarification about new Maryland Foreclosure ruling passed in June 2017 require that the note investor hold a Maryland Collection agency license in order to proceed with a foreclosure. Question is can note investor hire mortgage broker to act as a collection agency
Paradise, CA · Member since 2015 · 1k+ posts · 871 votes
9y
Maryland Collection Agency Licensing Act states you must be licensed as a collector to initiate a foreclosure.
Maryland Code B.R. § 7-101(c) defines a collection agency as follows:
CONCLUSION
A debt purchaser that attempts to collect a consumer debt by bringing a foreclosure action is required to have a license unless some statutory exemption applies.
Why would an investor hire a mortgage broker to act as a collection agency? Why wouldn't the investor just hire a foreclosure trustee licensed as a collector in that state or, hire a law firm licensed as a collector in that state instead of trying to get tricky and sneaker by hiring a mortgage broker to act as a collector, to perform a foreclosure action (Which must be ratified by the court anyway!?)
Financial services executive · Frederick, MD · Member since 2015 · 609 posts · 341 votes
9y
You would not be required to hold a collection agency license if the notes were performing when you bought them. There is also a lot of case law out there that says if your primary purchasing strategy is performing loans and you happen to get a nonperforming one bundled into a sale you do not need a collection agency license either.
You would not be required to hold a collection agency license if the notes were performing when you bought them. There is also a lot of case law out there that says if your primary purchasing strategy is performing loans and you happen to get a nonperforming one bundled into a sale you do not need a collection agency license either.
To buy them? agreed. To foreclose? Says you need a license. The OP question was, do you need to be a licensed collection agency on a foreclosure. According the the state law, at least the way i'm readying it, says you do.
Financial services executive · Frederick, MD · Member since 2015 · 609 posts · 341 votes
9y
@Ron S. You are misreading the requirements. If you purchase all performing notes you will not need the CA license to foreclose should one stop performing post purchase. You can contact the DLLR and they will answer any questions you have.