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House Engrossed |
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State of Arizona House of Representatives Fiftieth Legislature First Regular Session 2011
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HOUSE BILL 2297 |
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AN ACT
amending sections 6‑122 and 6‑841.02, Arizona Revised Statutes; repealing title 6, chapter 7, article 5, Arizona Revised Statutes; relating to escrow agents.
(TEXT OF BILL BEGINS ON NEXT PAGE)
Be it enacted by the Legislature of the State of Arizona:
Section 1. Section 6-122, Arizona Revised Statutes, is amended to read:
6-122. Superintendent; authority; duties; exemption
A. The superintendent has the authority and responsibility for the discharge of all duties imposed by law on the department.
B. The superintendent shall:
1. Examine or cause to be examined each financial institution annually, except financial institution holding companies, banks, savings and loan associations, credit unions and consumer lenders, and more frequently if the superintendent considers it necessary.
2. Examine or cause to be examined each bank, credit union and savings and loan association at the superintendent's discretion but at least once in every twenty‑four month period.
3. Examine or cause to be examined the business and affairs of any enterprise and any consumer lender for the purpose of administering and enforcing this title at the superintendent's discretion but at least once in a five year period.
4. Examine or cause to be examined financial institution holding companies as frequently as the superintendent considers necessary to administer and enforce this title.
5. Notwithstanding paragraph 3, examine or cause to be examined the accounts held in trust by each escrow agent at least once in every two year period in accordance with section 20‑1593 and examine or cause to be examined each escrow agent at least once in every four year period or more frequently if the superintendent considers it necessary.
6. Notwithstanding paragraph 3, examine or cause to be examined each premium finance company at least once in every three year period and more frequently if the superintendent considers it necessary.
7. Publish a consumer information brochure that includes:
(a) The finance charges permitted by this state.
(b) The types of insurance that may be offered but that are not required by law to be purchased with the granting of a loan.
(c) Interest rate limitations on all lenders including amounts that may not be charged to borrowers.
(d) Consumer rights and means of recourse from unfair practitioners.
8. Conduct a survey in January and July of each calendar year of each escrow agent that is regulated by the department. The superintendent shall compile the results of each survey and make those results available to the public. The survey shall be in substantially the following format:
"Please rate the performance of the department of financial institutions as one of the following: excellent, very good, good, fair, poor.
Please describe any problems that you believe should be addressed by the department."
C. Notwithstanding subsection B, paragraph 5 of this section, an escrow agent shall be examined within twelve months when an escrow agent's license is transferred or assigned pursuant to section 6‑813 or when control of the license is otherwise acquired.
D. Subsection B, paragraph 3 of this section does not apply to motor vehicle dealers, sales finance companies or persons licensed under chapter 12 of this title.
Sec. 2. Section 6-841.02, Arizona Revised Statutes, is amended to read:
6-841.02. Liability of title insurer; closing protection letter; definition
A. A real property escrow agent that is a title insurance agent shall disclose to the buyer and seller of a residential dwelling that the title insurer may shall offer on request a closing protection letter that provides protection for the loss of escrow monies due to fraud or dishonesty of the escrow agent. This disclosure requirement applies only to transactions involving a buyer and seller of a residential dwelling and shall be made when the buyer or seller employs the escrow agent.
B. If an escrow agent licensed pursuant to this chapter does not make the disclosure prescribed by this section, the title insurer shall reimburse the buyer or seller, as applicable, for any escrow monies that are lost and that are not recovered from the Arizona escrow recovery fund established by section 6‑847.01. The title insurer's obligation pursuant to this subsection shall be to the extent of that as set forth in the title insurer's standard closing protection letter for a buyer or seller, as applicable.
C. For the purposes of this section, "residential dwelling" means an owner occupied structure or an investment property that is designed for residential use by four or fewer families.
Sec. 3. Repeal; transfer of fund monies
A. Title 6, chapter 7, article 5, Arizona Revised Statutes, is repealed.
B. Any monies remaining in the Arizona escrow recovery fund on the effective date of this act are transferred to the state general fund.