{"data":{"id":"us-dc/d.c.-code-26-1114","jurisdiction":"us-dc","citation":"D.C. Code § 26-1114","heading":"Prohibited practices.","body":"(a)\nNo mortgage broker, mortgage lender, mortgage loan originator, or loan officer required to be licensed under this chapter, or person required to be licensed under this chapter, shall:\n(1)\nObtain any agreement or instrument in which blanks are left to be filled in after execution;\n(2)\nTake an interest in collateral other than the real estate or residential property, including fixtures and appliances thereon, securing a mortgage loan;\n(3)\nObtain any exclusive dealing or exclusive agency agreement from any borrower;\n(4)\nDelay closing of any mortgage loan for the purpose of increasing interest, costs, fees, or charges payable by the borrower;\n(5)\nObtain any agreement or instrument executed by a borrower which contains an acceleration clause permitting the unpaid balance of a mortgage loan to be declared due for any reason other than failure to make timely payments of interest and principal or to perform other obligations undertaken in the agreement or instrument;\n(6)\nMake, directly or indirectly, any mortgage loan with the intent to foreclose on the borrower’s property. For purposes of this paragraph, any of the following factors may be considered in determining whether a mortgage loan was made with the intent to foreclose on the borrower’s property:\n(A)\nLack of the probability of full repayment of the loan by the borrower; and\n(B)\nA significant proportion of similarly foreclosed loans by the lender;\n(7)\nIf acting as a mortgage lender, fail to require the person closing the mortgage loan to provide to the borrower prior to the closing of the mortgage loan:\n(A)\nA settlement statement as required pursuant to the Real Estate Settlement Procedures Act, approved December 22, 1974 (88 Stat. 1724; 12 U.S.C. § 2601 et seq.), and any regulations promulgated thereunder; and\n(B)\nAny disclosure which is required by the Truth in Lending Act, approved May 29, 1968 (82 Stat. 146; 15 U.S.C. § 1601 et seq.), and Regulation Z (12 CFR Part 226);\n(8)\nExcept for an application fee in an amount not to exceed 1% of the original principal amount of the mortgage loan applied for, and documented costs of credit reports and appraisals, receive compensation from a borrower until a written commitment to make a mortgage loan is given to the borrower by a mortgage lender which written commitment shall be given not less than 72 hours prior to the closing of the mortgage loan, unless this time period is waived by the borrower;\n(9)\nMake predatory loans or engage in predatory lending activities in violation of Chapter 11A of this title;\n(10)\nPurchase loans from an unlicensed mortgage broker or lender, unless the unlicensed mortgage broker or lender is exempt under § 26-1102; or\n(11)\nEngage in the business as a mortgage loan originator, mortgage lender, loan officer, or mortgage broker, or hold himself out to the public to be a mortgage loan originator, loan officer, mortgage lender, or mortgage broker, without a license under § 26-1104 or without an exemption under § 26-1102.\n\n(b)\nNo mortgage broker required to be licensed under this chapter shall:\n(1)\nReceive compensation from a mortgage lender of which he is a principal, partner, trustee, director, member, officer, or employee;\n(2)\nReceive compensation from a borrower in connection with any mortgage loan transaction in which he is the lender or a principal, partner, trustee, director, member, officer, or employee of the mortgage lender; or\n(3)\n(A)\nBROKER’S SIGNATURE  DATE\n(B)\nThe foregoing notice shall be at least 10-point type and the prospective borrower shall acknowledge receipt of the written notice.\n(C)\nThe phrase “person affiliated with such mortgage broker” means any person which is a subsidiary, stockholder, partner, trustee, director, member, officer, or employee of a mortgage broker, and any corporation, 10% or more of the capital stock of which is owned by a mortgage broker or by any person which is a subsidiary, stockholder, partner, trustee, director, member, officer, or employee of a mortgage broker.\n\n(c)\nNotwithstanding the provisions of subsection (b) of this section, no person shall act as a mortgage broker in connection with any real estate sales transaction entered into prior to September 9, 1996 in which such person, or any person affiliated with such person, has acted as a real estate broker, agent, or salesperson and has received or will receive compensation in connection with such transaction, unless such person was regularly engaged in acting as a mortgage broker in connection with such transaction as of September 9, 1996.\n\n(d)\nA licensee or any person required to be licensed under this chapter shall not:\n(1)\nDirectly or indirectly employ any scheme, device, or artifice to defraud or mislead borrowers or lenders or to defraud any person;\n(2)\nEngage in any unfair or deceptive practice toward any person;\n(3)\nObtain property by fraud or misrepresentation;\n(4)\nSolicit or enter into a contract with a borrower that provides in substance that the person or individual subject to this chapter may earn a fee or commission through “best efforts” to obtain a loan even though no loan is actually obtained for the borrower;\n(5)\nSolicit, advertise, or enter into a contract for specific interest rates, points, or other financing terms unless the terms are actually available at the time of soliciting, advertising, or contracting;\n(6)\nAssist or aid or abet any person in the conduct of business under this chapter without a valid license as required under this chapter;\n(7)\nFail to make disclosures as required by this chapter and any other applicable federal or District law, including regulations thereunder;\n(8)\nFail to comply with this chapter or rules promulgated under this chapter, or fail to comply with any other federal or District law, including the rules and regulations thereunder, applicable to any business authorized or conducted under this chapter;\n(9)\nMake, in any manner, any false or deceptive statement or representation, including with regard to the rates, points, or other financing terms or conditions for a residential mortgage loan, or engage in bait-and-switch advertising;\n(10)\nNegligently make any false statement or knowingly and willfully make any omission of material fact in connection with any information or reports filed with a governmental agency or the NMLSR or in connection with any investigation conducted by the Commissioner or another governmental agency;\n(11)\nMake any payment, threat, or promise, directly or indirectly, to any person for the purposes of influencing the independent judgment of the person in connection with a residential mortgage loan, or make any payment, threat, or promise, directly or indirectly, to any appraiser of a property for the purposes of influencing the independent judgment of the appraiser with respect to the value of the property;\n(12)\nCollect, charge, attempt to collect or charge, or use or propose any agreement purporting to collect or charge any fee prohibited by this chapter;\n(13)\nCause or require a borrower to obtain property insurance coverage in an amount that exceeds the replacement cost of the improvements as established by the property insurer; or\n(14)\nFail to truthfully account for monies belonging to a party to a residential mortgage loan transaction.","path":["Title 26. Banks and Other Financial Institutions.","Chapter 11. Mortgage Lenders and Brokers."],"source_url":"https://code.dccouncil.gov/us/dc/council/code/sections/26-1114","current_through":"2026-08-20 (D.C. Law 26-175)","vintage":"","retrieved_at":"2026-08-29T05:44:07Z","sha256":"4dde84e69ea1a8775ff4e48526848f8465e404c1663e136bca6fa931f5523ee5","source_id":"us-dc","stale":false,"prev":"us-dc/d.c.-code-26-1113","next":"us-dc/d.c.-code-26-1115"},"notice":"GroundRules: Original legal text. Not legal advice."}