Financial Institutions FAQ

How do I determine if my bank is regulated by the North Dakota Department of Financial Institutions?

We only regulate banks and trust companies chartered by our Department.  However, banks can also be chartered by the Office of the Comptroller of the Currency, commonly referred to as the OCC.  If you are not sure whether your bank is a state- or nationally-chartered bank, there are a few indicators in the bank's name.  Many state-chartered banks have "State" in their corporate name, while a nationally-chartered bank will commonly have "National" or "N.A." in its corporate name, which would appear on your deposit statements or checks.  Refer to the Who We Regulate page of this website for a general description of which banks are supervised by our Department and the Bank Search and Trust Company Search pages for a list of specific institutions which we regulate.

Is there a way to determine if I have unclaimed property in North Dakota?

Unclaimed property is administered by the Unclaimed Property Division of the State Land Department, in accordance with North Dakota Century Code Section 47-30.1-17.  Their unclaimed property search function can be used to determine if you have any unclaimed property which has been transferred to the state.

How do I file a complaint against a credit card company?

If the credit card issuer is not a North Dakota state-chartered bank, you may file a complaint with the Consumer Financial Protection Bureau.

What is the dormancy period for when unclaimed property is to be presumed abandoned and what are the procedures to report abandoned property in North Dakota?

Unclaimed property is administered by the Unclaimed Property Division of the State Land Department, in accordance with North Dakota Century Code Section 47-30.1-17.  Their Holder Reporting Manual includes guidance on dormancy periods and reporting requirements.

When does a bank need permission from the Department to declare and pay a dividend?

According to North Dakota Century Code Section 6-03-36, prior approval from the Commissioner or the State Banking Board is necessary to declare and pay a dividend when the proposed dividend exceeds the combined "net profits" of the bank from the current year plus the prior two years.  Banks may use our Dividend Worksheet to determine if prior approval is necessary.

What are the requirements when a real estate parcel is transferred into Other Real Estate Owned (OREO) in North Dakota?

According to North Dakota Century Code Section 6-03-08, upon transfer to OREO, a current appraisal of the property must be conducted by an individual who is independent of the transaction.  The appraisal does not have to be completed by a third-party certified appraiser, but it must be current and in writing, and the preparer must have appropriate independence.  The property should be carried on the bank's books at the lower of (1) cost or (2) the fair value of the asset less estimated selling costs.

What is the holding period for OREO and when does the holding period begin in North Dakota?

According to North Dakota Century Code Section 6-03-09, the holding period for OREO is five years from the date of acquiring title.  A 'clean' title is generally obtained at the end of the redemption period if the property goes through a foreclosure process, or whenever full legal title is transferred to the bank.  The statute grants the Commissioner authority to provide an extension to hold the property beyond five years.  An Extension Request form is available for banks to request approval to hold a property beyond five years.

What is the legal lending limit in North Dakota and how is it calculated?

Simply stated, the legal lending limit is the maximum amount which a bank may lend to a single borrower, or group of inter-related borrowers if acting as a common enterprise.  The legal lending limit for banks varies by bank charter and by state.  For a North Dakota-chartered state bank, the total liability of a single borrower may not exceed 25 percent of the bank's Tier 1 Capital as reported in the most recent Call Report.  Total liability includes any direct, indirect, and contingent liability of the borrower as well as any liabilities of separate borrowers for which repayment is substantially from the same source.

If a non-public depositor's (e.g. a nursing home or non-profit corporation) deposits exceed the FDIC insurance limit, can a bank pledge securities to secure those excess deposits in North Dakota?

No.  According to North Dakota Century Code Section 21-04-09, financial institutions may only pledge securities on behalf of a public corporation.   A public corporation generally includes a county, city, township, school district, or entity whose funding is derived from taxation, fees, penalties, sales of bonds, or from any other source which belong to a public corporation or the state.

What securities are eligible for pledging to a public corporation's deposits in North Dakota?

North Dakota Century Code Section 21-04-09 defines the securities which are eligible for pledging to public corporation deposits.  In addition to this list of securities, in May 1988, the State Banking Board authorized financial institutions the ability to pledge general obligation municipal bonds from other states rated "A" or better, or revenue bonds if backed by an agency or instrumentality of the U.S. government.

Is there a residency requirement for Board members of North Dakota state-chartered banks?

North Dakota Century Code Section 6-03-02.4 requires a board to consist of not less than three nor more than 25 members, at least 2/3 of whom must be citizens of the United States.

If I work at a state bank, am I allowed to telework, work in a location other than the bank's office(s)?

Yes, staff of a bank may telework with some limitations.  Your telework location cannot be held open to the public as a place of business.  You are not able to meet with customers at this remote location without first applying for the location to be a branch.  Bank and staff are expected to follow best business practices to safeguard both digital data and hard copy data.  Typically, this will include, in part, the use of VPN connections, encryption, firewalls, and locking file cabinets.       

How do I determine if my credit union is regulated by the North Dakota Department of Financial Institutions?

We only regulate credit unions chartered by our Department.  However, credit unions can also be chartered by the National Credit Union Administration (NCUA).  If you are not sure whether your credit union is a state- or federally-chartered credit union, there are a few indicators in the credit union's name.  Many state-chartered credit unions have "State" in their corporate name, while a federally-chartered credit union will commonly have "Federal" in its corporate name, which would appear on your deposit statements or checks.  Refer to the Who We Regulate page of this website for a general description of which credit unions are supervised by our Department and the Credit Union Search page for a list of specific institutions which we regulate.

Where can I find financial information about a credit union?

NCUA collects and makes financial information on credit unions available to the public.  Visit https://recent5300.ncua.gov/Views/GetUpdateCreditUnions.aspx

I don't understand my deposit statement? Who can help me with that?

We  encourage you to contact your credit union.  The staff there should have a good understanding of their statements and should be in a better position to help.

I have legal issues with my credit union. Can the Department help me?

The Department cannot act as your legal counsel.  We cannot intervene in legal disputes between you and credit union.  We may be able to encourage/facilitate communication between the parties, but once an issue has been turned over to legal counsel, the Department cannot get involved.  Before filing a complaint with the Department, we encourage you to first contact credit union management to try and resolve the dispute.

Is it legal for a credit union to charge me fees?

With some restrictions, credit unions can charge fees on both loan and deposit products.  Typically, the loan or deposit agreement which you signed at origination/account opening will outline the terms of the contract.

Where can I find regulatory guidance dealing with credit unions?

The Department has issued several Guidance Memos, which can be found here.  Additionally, the NCUA has issued Letters to Credit Unions, which can be found here.

I do not understand a State rule regarding credit unions. Is that something the Department can help with?

Yes, Department staff are here as a resource.  We first encourage you to review the Department's Guidance Memos, which provide some useful guidance on a number of different topics.  If you still have a question, please contact us and we will try to answer your question where possible.

I do not understand part of an NCUA rule. Is that something the Department can help with?

Yes, Department staff are here as a resource.  We first encourage you to review the NCUA's Examiner Guide as it provides some useful guidance on a number of different topics.  If you still have a questions, please contact us and we will try to answer your question where possible or put you in contact with someone at the NCUA who can answer it.

My credit union would like to establish a branch location. Do I need to apply for approval?

Yes, North Dakota Administrative Code 13-03-15 requires you to obtain prior State Credit Union Board approval before establishing a branch.

If a property securing a loan is within the credit union's geographical field of membership, but the borrower does not live in the field of membership, is the borrower eligible for membership?

No.  The borrower would need to reside in the field of membership to be a member.  Property/collateral location does not determine membership eligibility.  Residency determines eligibility for geographic fields of membership.

Who should I contact to address concerns relating to my NMLS account?

For concerns relating to the NLMS system, including your company and individual records, contact the NMLS Call Center at (855) 665-7123.  For specific questions relating to North Dakota licensing regulations, feel free to contact our Department.

Does North Dakota regulate the content of a website (URL) address? Please note this is not referring to the contents of the website. If so, what are the general requirements for URL address?

Generally, the Department does not regulate or restrict website (URL) names or addresses.  The one exception is if the address includes the words "bank", "credit union", "trust" or any variation of those terms which could inaccurately represent or imply the website belongs to one of these entities.

If a legal name of a company is not included in the website (URL) address, is the website required to be registered as a DBA?

No.

If the legal name of a company is not included in the website (URL) address, should the website be listed in the company's NMLS profile?

Yes, the correct contact information should be listed in NMLS.

If the legal name of a company is not included in the website (URL) address, should the website be registered with the Secretary of State (or like agency)?

At this time, there are no registration requirements for website addresses with the Secretary of State.

If the legal name of a company is not included in the website (URL) address, should the website be a subset of the company's primary website (URL) address? (example wwwcompanyname/JohnDoecompany.com)

This is a business decision that is not regulated by the Department of Financial Institutions.

What type of activity requires a collection agency license in North Dakota?

NDCC Section 13-05-02 requires a collection agency license for any person or entity who engages in debt collection with a debtor residing in North Dakota.

Do I need a license if I collect business or commercial debt?

Yes, the broad definition of debt collection includes both consumer and commercial debt.

Do I need a license if I merely purchase debt?

If a person or entity purchases debt that is not in default, that person or entity may qualify under the creditor exemption from licensure found in NDCC 13-05-02 (9), and collect on the debt.  However, if the debt was in default at the time of purchase, the party receiving assignment or transfer of the debt would not qualify under the creditor exemption.  As such, while the debt could still be purchased, the entity or individual would require licensure to collect on the debt, unless another exemption applied.

Do I need a license if I purchase debt that is in default but use a licensed third-party debt collection agency to collect the debt?

Yes, the Department has determined passive debt buyers fall under the definition of “debt collection” in NDCC 13-05-01.1(7). In this instance, both the debt buyer and third-party debt collection agency are required to hold a North Dakota collection agency license.

How can I determine if an individual or entity is licensed as a collection agency in North Dakota?

The Department participates in the NMLS, as contemplated by the Secure and Fair Enforcement for Mortgage Licensing Act of 2008 ("SAFE Act").  Title V of this Act required each state to enact minimum standards regarding the supervision of mortgage entities.  The NMLS is a multi-state licensing system that allows companies and individuals to apply for and manager their licenses with the each state through a secure and centralized website.  All collection agencies licensed by our Department are registered through the NMLS system.  You can determine whether a company or individual is a licensed collection agency in North Dakota by going to the NMLS Consumer Access portal:  http://www.nmlsconsumeraccess.org.

What are the requirements to be a collection agency in North Dakota and how do I obtain a license?

Entities or individuals seeking a collection agency license can do so by accessing the NMLS Resource Center:  https://mortgage.nationwidelicensingsystem.org/slr/Pages/DynamicLicenses.aspx?StateID=ND.  A checklist of requirements is available on that site.

Is North Dakota a state which requires a physical presence for its collection agency license?

North Dakota does not require a physical presence for its collection agency license.

What are the fees associated with obtaining a collection agency license in North Dakota?

North Dakota license fees include a $400 initial application fee and a $400 annual license fee, which is required at each subsequent renewal.  Further, there is a $50 annual fee for each branch location registered to engage in debt collection in North Dakota.  In addition, licensees will be responsible for NMLS charges, including processing fees, criminal background check fees, and credit report check fees.

How often do I need to renew my collection agency license?

All licenses issued by the Department are annual in nature and need to be renewed for each calendar year.  The renewal period begins November 1st and closes on December 31st of each year.

If I work for a licensed collection agency, am I allowed to telework, work in a location other than the collection agency's headquarters?

Yes, staff of a collection agency may telework with some limitations.  Your telework location cannot be held open to the public as a place of business.  You are not able to meet with customers at this remote location without first obtaining branch licensure.  Collection agency and staff are expected to follow best business practices to safeguard both digital data and hard copy data.  Typically this will include, in part, the use of VPN connections, encryption, firewalls, and locking file cabinets.       

What are some general protections for consumers relating to collection agencies?

Knowing your rights is important.  A good resource for reviewing your rights relating to debt collection activities can be found at the Federal Trade Commission (FTC) website:  https://www.consumer.ftc.gov/articles/0149-debt-collection.  This site discusses a variety of collection issues, including the Fair Debt Collection Practices Act (FDCPA), time and methods of phone calls, privacy, information you are entitled to receive, prohibited collection practices, garnishments, legal recourse, and complaints.

What type of activity requires a debt-settlement provider license in North Dakota?

NDCC Section 13-11-02 requires a debt-settlement provider license for any person who provides debt-settlement services to North Dakota residents.  NDCC 13-11-01 (6) defines a debt-settlement provider to mean "...any person engaging in, or holding itself out as engaging in, the business of providing debt-settlement service in exchange for any fee or compensation, or any person who solicits for or acts on behalf of any person engaging in, the business of providing debt-settlement service in exchange for any fee or compensation."

NDCC 13-11-01 (7)(a) and (7)(b) provides details on what constitutes debt-settlement services and what activities are not included.

Who is exempt from licensure as a debt-settlement provider in North Dakota?

A list of exempted entities and individuals is included in NDCC 13-11-01 (6).

How can I determine if a debt-settlement provider is licensed to do business in North Dakota?

The Department participates in the NMLS, as contemplated by the Secure and Fair Enforcement for Mortgage Licensing Act of 2008 ("SAFE Act").  Title V of this Act required each state to enact minimum standards regarding the supervision of mortgage entities.  The NMLS is a multi-state licensing system that allows companies and individuals to apply for and manager their licenses with the each state through a secure and centralized website.  All companies licensed by our Department are registered through the NMLS system.  You can determine whether a company or individual is a licensed debt-settlement provider in North Dakota by going to the NMLS Consumer Access portal:  http://www.nmlsconsumeraccess.org.

What are the requirements to be a debt-settlement provider in North Dakota and how do I obtain a license?

Individuals seeking a debt-settlement provider license can do so by accessing the NMLS Resource Center:  https://mortgage.nationwidelicensingsystem.org/slr/Pages/DynamicLicenses.aspx?StateID=ND.  A checklist of requirements is available on that site.

Is North Dakota a state which requires a physical presence for its debt-settlement provider license?

North Dakota does not require a physical presence for its debt-settlement provider license.

What are the fees associated with obtaining a debt-settlement provider license in North Dakota?

North Dakota license fees include a $400 initial application fee and a $400 annual license fee, which is required at each subsequent renewal.   Further, each applicant must pay a $50 annual fee for each branch location registered to engage in debt-settlement in North Dakota.  In addition, licensees will be responsible for NMLS charges, including processing fees, criminal background check fees, and credit report check fees.

How often do I need to renew my debt-settlement provider license in North Dakota?

All licenses issued by the Department are annual in nature and need to be renewed for each calendar year.  The renewal period begins November 1st and closes on December 31st of each year.

If I work for a licensed debt-settlement provider, am I allowed to telework, work in a location other than the debt-settlement provider's headquarters?

Yes, staff of a debt settlement provider may telework with some limitations.  Your telework location cannot be held open to the public as a place of business.  You are not able to meet with customers at this remote location without first obtaining branch licensure.  Debt settlement provider and staff are expected to follow best business practices to safeguard both digital data and hard copy data.  Typically this will include, in part, the use of VPN connections, encryption, firewalls, and locking file cabinets.       

What type of activity requires a deferred presentment service provider license in North Dakota?

NDCC Section 13-08-01 (5)  states that a deferred presentment service transaction means a transaction by which a person pays to a customer the amount of a check and accepts a check from the customer on the date of the transaction and agrees to hold the check for a period of time before presentment, accepts a check dated after the date of the transaction and agrees to hold the check for a period of time before presentment, or pays to the customer an agreed-upon amount and obtains the customer's authorization to transfer or withdraw, electronically or otherwise, funds from a customer's account in repayment at some future, agreed-upon date.  NDCC Section 13-08-02 requires a license in order to provide deferred presentment services. A person is considered to be providing a deferred presentment service if the customer is located in this state.

How can I determine is a deferred presentment service provider is licensed to do business in North Dakota?

The Department participates in the NMLS, as contemplated by the Secure and Fair Enforcement for Mortgage Licensing Act of 2008 ("SAFE Act").  Title V of this Act required each state to enact minimum standards regarding the supervision of mortgage entities.  The NMLS is a multi-state licensing system that allows companies and individuals to apply for and manager their licenses with the each state through a secure and centralized website.  All companies licensed by our Department are registered through the NMLS system.  You can determine whether a company or individual is a licensed deferred presentment service provider in North Dakota by going to the NMLS Consumer Access portal:  http://www.nmlsconsumeraccess.org.

What are the requirements to be a deferred presentment service provider in North Dakota and how do I obtain a license?

Individuals seeking a money broker license can do so by accessing the NMLS Resource Center:  https://mortgage.nationwidelicensingsystem.org/slr/Pages/DynamicLicenses.aspx?StateID=ND.  A checklist of requirements is available on that site.

Do I need to secure a separate license for each location that I operate in North Dakota?

Yes.  NDCC Section 13-08-02 states that a licensee is required to acquire a separate deferred presentment service provider license for each location from which business is conducted.  This means that investigations or examinations will be conducted on each branch as if it were a separate company.  However, in the NMLS system, these additional locations are referred to, and treated as, branches.

Is North Dakota a state which requires a physical presence for its deferred presentment service provider license?

North Dakota does not require a physical presence for its deferred presentment service provider license.

What are the fees associated with obtaining a deferred presentment service provider license in North Dakota?

North Dakota license fees include a $400 initial application fee and a $450 annual license fee, which is required at each subsequent renewal.  These licensing fees are required for each location operated by the licensee which is registered to conduct payday lending in North Dakota.  In addition, licensees will be responsible for NMLS charges, including processing fees, criminal background check fees, and credit report check fees.

Can deferred presentment service providers provide title loans in North Dakota?

No.  NDCC 13-08-12 (1)(f) states:  "No property, titles to any property, or mortgage may be received or held directly or indirectly by the licensee as a condition of a deferred presentment service transaction or as a method of collection on a defaulted deferred presentment service transaction without proper civil process."

How often do I need to renew my deferred presentment service provider license in North Dakota?

All licenses issued by the Department are annual in nature and need to be renewed for each calendar year.  The renewal period begins November 1st and closes on December 31st of each year.

What is the maximum amount for a payday loan in North Dakota?

NDCC 13-08-12 (4) states the maximum aggregate amount of outstanding obligations that can be held by one individual is $600, of which $500 would be the actual loan proceeds.  This means that a licensee will not be authorized to provide any additional payday loans to a person who already owes $600 in payday loan obligations.

What is the maximum fee for a payday loan in North Dakota?

NDCC 13-08-12 (2) states that a licensee's fee cannot exceed 20% of the amount paid to the customer by the licensee. {example:  For a payday loan of $100, the licensee can charge a maximum fee of $20}.  The only other fee that may be passed on to the customer is the actual fee paid by the licensee to register the transaction on the payday loan database.

If I work for licensed deferred presentment service provider, am I allowed to telework, work in a location other than the deferred presentment service provider's headquarters?

Yes, staff of a deferred presentment service provider may telework with some limitations.  Your telework location cannot be held open to the public as a place of business.  You are not able to meet with customers at this remote location without first obtaining branch licensure.  Deferred presentment service provider and staff are expected to follow best business practices to safeguard both digital data and hard copy data.  Typically this will include, in part, the use of VPN connections, encryption, firewalls, and locking file cabinets.     

What type of activity requires a North Dakota money broker's license?

NDCC Section 13-04.1-02 requires a money broker license for any person engaging in money brokering activities with a borrower who resides in North Dakota.

NDCC 13-04.1-01.1 (4) defines money brokering as "...the act of arranging or providing loans or leases as a form of financing, or advertising or soliciting either in print, by letter, in person, or otherwise, the right to find lenders or provide loans or leases for persons or businesses desirous of obtaining funds for any purposes."

Is commercial lending considered to be a money brokering activity in North Dakota?

Yes, the broad definition of money brokering includes both consumer and commercial lending.

How can I determine if an individual or entity is licensed as a money broker in North Dakota?

The Department participates in the NMLS, as contemplated by the Secure and Fair Enforcement for Mortgage Licensing Act of 2008 ("SAFE Act").  Title V of this Act required each state to enact minimum standards regarding the supervision of mortgage entities.  The NMLS is a multi-state licensing system that allows companies and individuals to apply for and manager their licenses with the each state through a secure and centralized website.  All non-bank and credit union companies licensed as money brokers by our Department are registered through the NMLS system.  You can determine whether a company or individual is a licensed money broker in North Dakota by going to the NMLS Consumer Access portal:  http://www.nmlsconsumeraccess.org.

Who is exempt from licensure as a money broker in North Dakota?

A list of individuals and entities exempt from money broker licensure requirements is found under NDCC 13-04.1-02.1

What are the requirements to be a money broker in North Dakota and how do I obtain a license?

Entities or individuals seeking a money broker license can do so by accessing the NMLS Resource Center:  https://mortgage.nationwidelicensingsystem.org/slr/Pages/DynamicLicenses.aspx?StateID=ND.  A checklist of requirements is available on that site.

Is North Dakota a state which requires a physical presence for its money broker license?

North Dakota does not require a physical presence for its money broker license.

What are the fees associated with becoming a money broker in North Dakota?

North Dakota license fees include a $400 initial application fee and a $400 annual license fee, which is required at each subsequent renewal.  Further, there is a $50 annual fee for each branch location registered to engage in money brokering in North Dakota.  In addition, licensees will be responsible for NMLS charges, including processing fees, criminal background check fees, and credit report check fees.

How often do I need to renew my money broker license in North Dakota?

All licenses issued by the Department are annual in nature and need to be renewed for each calendar year.  The renewal period begins November 1st and closes on December 31st of each year.

If I work for a licensed money broker, am I allowed to telework, work in a location other than the money broker's headquarters?

Yes, staff of a money broker may telework with some limitations.  Your telework location cannot be held open to the public as a place of business.  You are not able to meet with customers at this remote location without first obtaining branch licensure.  Money broker and staff are expected to follow best business practices to safeguard both digital data and hard copy data.  Typically this will include, in part, the use of VPN connections, encryption, firewalls, and locking file cabinets.       

Are loan late or NSF charges included in the calculation of the maximum loan interest rate allowed under North Dakota Century Code 13-04.1?

No, the department’s application of the law for examination purposes is that the maximum charges are those present and calculated at the time of the execution of the credit or loan document.  Loan late or NSF charges are subsequent to the loan origination and are not included in the calculation. 

Are fees associated with additional products such as credit life insurance included in the calculation of the maximum loan interest rate allowed under North Dakota Century Code 13-04.1?

During an examination, the Department will review the fees and determine if they were necessary for the borrower to obtain credit.  If credit life insurance was required by the lender to obtain the loan, then the cost of credit life will be a cost of financing and included in the maximum loan interest rate calculation.  If the extension of credit was not contingent upon the sale of credit life, rather the credit life was a voluntary purchase by the borrower, then the fees are not included in the calculation.

Are NSF charges included in the maximum late payment charge allowed under North Dakota Century Code 13-04.1?

During an examination, the examiners will consider NSF charges charged by the third party the check was drawn upon which are levied against the money broker and passed on to the borrower to be a collection cost and not be included in the $20 late fee cap.

Are loan advance fees on lines of credit included in the calculation of the maximum loan interest rate allowed under North Dakota Century Code 13-04.1?

No.  During an examination, the Department will not consider subsequent loan advance fees on lines of credit to be part of the maximum interest rate calculation. 

If a line of credit is originated with a maximum draw of more than $50,000 but the initial advance is less than $50,000, is this loan subject to the $20 late fee cap?

No.  During an examination, the Department will consider the origination amount to be the maximum available draw on the line of credit.  Since the origination was for more than $50,000, the cap will not apply.

Are third party loan related fees incurred by the lender and passed onto the borrower such as the cost of a credit report, mortgage filing, lien filing, or appraisal necessary for the extension of credit included in the maximum loan interest rate allowed?

No.  During an examination, the Department will not consider these in calculating the maximum interest rate allowed under North Dakota Century Code 13-04.1.

Are collection costs such as court fees included in the late fee allowed under North Dakota Century Code 13-04.1?

No.  During an examination, the Department will not consider these third-party charges in calculating the maximum late fee or maximum APR allowed under North Dakota Century Code 13-04.1.

Does lead generation require a money broker license in North Dakota?

Lead generator means a person who, for or with the expectation of compensation or gain: (a) sells, assigns, or otherwise transfers one or more leads for a consumer finance loan or a residential mortgage loan; (b) generates or augments one or more leads for another person; (c) directs a consumer to another person for consumer financing or a residential mortgage loan by performing marketing services, including, but not limited to, online marketing, direct response advertising or telemarketing.

A licensed lead generator shall not be deemed to be acting as a mortgage lender, mortgage correspondent lender, mortgage broker or mortgage loan originator when engaged in the activities of a lead generator, if such person does not: (1) obtain compensation or gain contingent upon the consummation of a consumer finance loan or a residential mortgage loan or the receipt of a residential mortgage loan application, or (2) utilize financial criteria particular to the consumer or the residential mortgage loan transaction to selectively place a lead or to steer a consumer to a specific person for a consumer finance loan or a residential mortgage loan.

What type of activity requires a money transmitter license in North Dakota?

NDCC Section 13-09-01 requires a money transmitter license for any person who engages in the business of money transmission with North Dakota residents, even if that person has no physical presence in the state.  Under NDCC 13-09-02 (13), money transmission means to "...engage in the business of the sale or issuance of payment instruments, stored value, or of receiving money or monetary value for transmission to a location within or outside the United States by any and all means, including wire, facsimile, or electronic transfer."  Under the same definition, bill payment services are expressly included, while payment processing activities conducted for a merchant under an agency relationship are excluded.

How can I determine if a money transmitter is licensed to do business in North Dakota?

The Department participates in the NMLS, as contemplated by the Secure and Fair Enforcement for Mortgage Licensing Act of 2008 ("SAFE Act").  Title V of this Act required each state to enact minimum standards regarding the supervision of mortgage entities.  The NMLS is a multi-state licensing system that allows companies and individuals to apply for and manager their licenses with the each state through a secure and centralized website.  All companies licensed by our Department are registered through the NMLS system.  You can determine whether a company or individual is a licensed money transmitter in North Dakota by going to the NMLS Consumer Access portal:  http://www.nmlsconsumeraccess.org.

Who is exempt from licensure as a money transmitter in North Dakota?

A list of exclusions from the requirement for a money transmitters license can be found under NDCC 13-09-03.

What are the requirements to be a money transmitter in  North Dakota and how do I obtain a license?

Individuals seeking a money transmitter license can do so by accessing the NMLS Resource Center:  https://mortgage.nationwidelicensingsystem.org/slr/Pages/DynamicLicenses.aspx?StateID=ND.  A checklist of requirements is available on that site.

Is North Dakota a state which requires a physical presence for its money transmitter license?

North Dakota does not require a physical presence for its money transmitter license.

What are the fees associated with obtaining a money transmitter license in North Dakota?

North Dakota license fees include a $450 initial application fee and a $400 license fee.  A licensee under this chapter shall pay an annual renewal fee equal to $500 or one-fourth of one percent of the money transmission dollar volume in North Dakota for the twelve months ending June 30th, whichever is greater.  The fee may not exceed $2,500.  A minimum of $500 will be paid at the time of the license renewal, and any required renewal fee in excess of $500 will be invoiced through NMLS to be paid at the time of the license renewal.  In addition, licensees will be responsible for all NMLS charges, including processing fees, criminal background check fees, credit report check fees, and active authorized agent/delegate location fees.

How often do I need to renew my money transmitter license in North Dakota?

All licenses issued by the Department are annual in nature and need to be renewed for each calendar year.  The renewal period begins November 1st and closes on December 31st of each year.

Is virtual currency regulated under North Dakota money transmitter statutes?

Currently, the Department does not consider the control or transmission of virtual currency to fall under the scope of NDCC 13-09.  However, any such company that also holds or transmits fiat currency will still need to secure a money transmitter license.

My company holds flat currency in a digital wallet to facilitate peer-to-peer and/or business-to-business transactions. Does my company need a money transmitter license?

Yes.  Fiat currency-based peer-to-peer and business-to-business transactions are considered money transmission and require a license.

Do I need a money transmitter license to purchase, sell, or operate an exchange for virtual currency?

No.  The purchase, sale, or exchange of virtual currency does not in and of itself require a money transmitter license.  However, other activities related to these business lines may trigger this requirement, such as the transmission of fiat currency-denominated assets to third parties.

My company holds fiat currency in a digital wallet for customers.  The fiat currency is used to purchase virtual currency. Does my company need a money transmitter license?

No.  Using a digital wallet to store fiat currency for the purpose of purchasing virtual currency does not require a money transmitter license.

My company hold fiat currency in a digital wallet for customers, which is used to purchase virtual or to transmit fiat currency to the customer's other accounts or digital wallets. Does my company need a money transmitter license?

No.  The transfer of virtual or fiat currency between digital wallets or accounts owned by the same customer does not require a money transmitter license.

My company holds fiat currency in a digital wallet for customers. The fiat currency can be transmitted to third parties at the direction of the owner of the wallet. Does my company need a money transmitter license?

While the transmission of virtual currency is not considered a money transmission activity, the transmission of fiat currency on behalf of a customer to a third party does create a licensing requirement.

My company has coin kiosks in North Dakota which are used to exchange fiat currency into virtual currency. Does my company need a money transmitter license?

No.  The operation of a coin kiosk or fiat currency machine to purchase virtual currency in and of itself does not create the need for a money transmitter license.

My company engages in foreign currency exchange. Does my company need a money transmitter license?

No. North Dakota's money transmitter rule does not apply to foreign currency exchange.  If your company also engages in any type of transmission as part of this activity, that activity would trigger the need for a license.  For example, activities that would trigger a license include peer-to-peer or business-to-business transmissions.

If I work for a licensed money transmitter, am I allowed to telework, work in a location other than the money transmitter's headquarters?

Yes, staff of a money transmitter may telework with some limitations.  Your telework location cannot be held open to the public as a place of business.  You are not able to meet with customers at this remote location without first obtaining branch licensure.  Money transmitter and staff are expected to follow best business practices to safeguard both digital data and hard copy data.  Typically this will include, in part, the use of VPN connections, encryption, firewalls, and locking file cabinets.       

What types of receivables can be used to meet permissible investment requirements?

Permissible investments may include receivables that are due to a licensee from its authorized delegates pursuant a contract described in section 13-05-15, which are not past-due or doubtful of collection. Additionally, debit card or credit card-funded transmission receivables not yet settled, and ACH debits not yet cleared, representing money from the customer’s account which has been reserved and is in the clearing cycle to be delivered to the licensee are also permissible investments.

What is a residential mortgage loan for purposes of North Dakota law?

A residential mortgage loan is defined by NDCC 13-10-02 (12) as "...any loan primarily for personal, family, or household use that is secured by a mortgage, deed of trust, or other equivalent consensual security interest on a dwelling, as defined in section 103(v) of the Truth in Lending Act, or residential real estate upon which is constructed or intended to be constructed such a dwelling."

What is a Mortgage Loan Originator (MLO) and do they need to be licensed in North Dakota?

North Dakota Century Code (NDCC) Section 13-10-02 (6) defines a Mortgage Loan Originator to include any "...individual who for compensation or gain or in the expectation of compensation or gain:  (1) takes a residential mortgage loan application; or (2) offers or negotiates terms of a residential mortgage loan."  The statute also defines a list of activities not included with the meaning of the term.    Unless specifically exempted from licensing, a person requires a license if he/she engages in the business of an MLO with respect to any dwelling located in North Dakota.

How can I determine if a specific MLO is licensed in North Dakota?

The Department participates in the NMLS, as contemplated by the Secure and Fair Enforcement for Mortgage Licensing Act of 2008 ("SAFE Act").  Title V of this Act required each state to enact minimum standards regarding the supervision of mortgage entities.  The NMLS is a multi-state licensing system that allows companies and individuals to apply for and manager their licenses with the each state through a secure and centralized website.  Through the NMLS consumer access portal, any person can determine which state(s) a company and/or individual are licensed to conduct lending activities.  The consumer access portal's website is:  http://www.nmlsconsumeraccess.org.

Who is exempt from licensure as an MLO?

NDCC 13-10-02 (6) provides limited exceptions from the definition of Mortgage Loan Originator, including:  an individual engaged solely as a loan processor or underwriter, a person or entity that only performs real estate brokerage activities and is licensed or registered in accordance with North Dakota law, or a person or entity solely involved in extension of credit related to timeshare plans.  However, it should be noted that there are only limited circumstances in which these parties are exempt, and any party seeking to fall under one of these exemptions should review the full text of the exemptions found under 13-10-02 (6).

How do I become licensed as an MLO in North Dakota?

All MLO licenses are obtained by first completing an application through the Nationwide Multistate Licensing System (NMLS) Resource Center:   https://mortgage.nationwidelicensingsystem.org/slr/Pages/DynamicLicenses.aspx?StateID=ND.

What are the fees associated with obtaining an MLO license in North Dakota?

North Dakota license fees include a $25 initial application fee and a $50 annual license fee, which is required at each subsequent renewal.  In addition, licensees will be responsible for NMLS charges, including processing fees, criminal background check fees, and credit report check fees.

Approximately how long does it take to process a new MLO license application in North Dakota?

Our average processing time is 1 to 14 days, depending on the timeliness and completeness of applicant responses to requests for information.

How often do I need to renew my MLO license in North Dakota?

All licenses issued by the Department are annual in nature and need to be renewed for each calendar year.  The renewal period begins November 1st and closes on December 31st of each year.

Where do I complete my education and testing requirements to become a licensed MLO?

All education and testing requirements are submitted and processed through the NMLS Resource Center:  https://mortgage.nationwidelicensingsystem.org/slr/Pages/DynamicLicenses.aspx?StateID=ND.

What happens when a sponsorship withdrawal is submitted for an MLO?

If the MLO is active and the sponsorship is removed, the MLO will be moved to an "Approved-Inactive" status.  The license can still be renewed and will be kept in the "Approved-Inactive" status provided continuing education requirements are met.  However, an MLO is unable to conduct business while in the "Approved-Inactive" status.

In this circumstance, it is the MLO's responsibility to find another sponsor.  If another sponsor cannot be obtained, the alternative is for that MLO to obtain a license as a money broker, who will then sponsor his/her MLO license.

Can an MLO be sponsored by more than one money broker in North Dakota?

No, each MLO can only be sponsored by one North Dakota-licensed money broker.

If I am a licensed mortgage loan originator that works for a licensed money broker, am I allowed to telework, work in a location other than the money broker's headquarters?

Yes, staff of a money broker may telework with some limitations.  Your telework location cannot be held open to the public as a place of business.  You are not able to meet with customers at this remote location without first obtaining branch licensure.  Money broker and staff are expected to follow best business practices to safeguard both digital data and hard copy data.  Typically this will include, in part, the use of VPN connections, encryption, firewalls, and locking file cabinets.       

Does North Dakota allow dual capacity?

The North Dakota Residential Mortgage Lender Act under section 13-12-14 (prohibited acts and practices) requires Commissioner approval of any other business conducted at a licensed Residential Mortgage Lender location. With respect to a realty agency and a licensed Residential Mortgage Lender, In order to receive approval, we have specific conditions that must be met which includes a clear separation of business through specific office space requirements, personnel, records storage, etc., and review on a case-by-case basis.  We view an individual acting in dual capacity to be violating separation of business conditions. We do not allow a single individual to act as both the real estate agent and mortgage loan originator on the same transaction; however, we do not prohibit ownership or even employment in both types of businesses.

What type of activity requires a North Dakota residential mortgage lender license?

NDCC Section 13-12- 03. Except as otherwise provided, a person other than a residential mortgage lender licensed and authorized under this chapter may not engage in residential mortgage lending in the state without a residential mortgage lender license issued by the commissioner. A person engages in residential mortgage lending if the borrower resides in North Dakota.

NDCC 13-12-02 (6) "Residential mortgage lender" means a person that, in the ordinary course of business, engages in residential mortgage lending. (7) "Residential mortgage lending" means the act of arranging or providing residential mortgage loans as a form of financing, or advertising or soliciting either in print, by letter, in person, or otherwise, the right to find lenders or provide residential mortgage loans for a person. (8) "Residential mortgage loan" means residential mortgage loan as defined in subsection 12 of section 13 - 10 - 02. (9) "Residential real estate" means residential real estate as defined in subsection 13 of section 13-10-02.

NDCC 13-10-02 (12) "Residential mortgage loan" means any loan primarily for personal, family, or household use that is secured by a mortgage, deed of trust, or other equivalent consensual security interest on a dwelling, as defined in section 103(v) of the Truth in Lending Act, or residential real estate upon which is constructed or intended to be constructed such a dwelling. (13) "Residential real estate" means any real property located in North Dakota, upon which is constructed or intended to be constructed a dwelling.

Is commercial lending considered to be a residential mortgage activity in North Dakota?

No, the broad definition of residential mortgage loan does not include commercial lending.  Please noted that commercial lending may be subject to separate licensure under NDCC 13-04.1.

How can I determine if an individual or entity is licensed as a residential mortgage lender in North Dakota?

The Department participates in the NMLS, as contemplated by the Secure and Fair Enforcement for Mortgage Licensing Act of 2008 ("SAFE Act").  Title V of this Act required each state to enact minimum standards regarding the supervision of mortgage entities.  The NMLS is a multi-state licensing system that allows companies and individuals to apply for and manager their licenses with each state through a secure and centralized website.  All non-bank and credit union companies licensed as residential mortgage lenders by our department are registered through the NMLS system.  You can determine whether a company or individual is a licensed residential lender in North Dakota by going to the NMLS Consumer Access portal:  http://www.nmlsconsumeraccess.org.

Who is exempt from licensure as a residential mortgage lender in North Dakota?

A list of individuals and entities exempt from residential mortgage lending licensure requirements is found under NDCC 13-12-04.

What are the requirements to be a residential mortgage lender in North Dakota and how do I obtain a license?

Entities or individuals seeking a residential mortgage lender license can do so by accessing the NMLS Resource Center:  https://mortgage.nationwidelicensingsystem.org/slr/Pages/DynamicLicenses.aspx?StateID=ND.  A checklist of requirements is available on that site.

Is North Dakota a state which requires a physical presence for its residential mortgage lender license?

North Dakota does not require a physical presence for its residential mortgage lender license.

What are the fees associated with becoming a residential mortgage lender in North Dakota?

North Dakota license fees include a $400 initial application fee and a $400 annual license fee, which is required at each subsequent renewal.  Further, there is a $50 annual fee for each branch location registered to engage in residential mortgage lending in North Dakota.  In addition, licensees will be responsible for NMLS charges, including processing fees, criminal background check fees, and credit report check fees.

How often do I need to renew my residential mortgage lender license in North Dakota?

All licenses issued by the Department are annual in nature and need to be renewed for each calendar year.  The renewal period begins November 1st and closes on December 31st of each year.

If I work for a licensed residential mortgage lender, am I allowed to telework, work in a location other than the residential mortgage lender's headquarters?

Yes, staff of a residential mortgage lender may telework with some limitations. The telework location cannot be held open to the public as a place of business.  You are not able to meet with customers at this remote location without first obtaining branch licensure.  Residential mortgage lender and staff are expected to follow best business practices to safeguard both digital data and hard copy data.  Typically, this will include, in part, the use of VPN connections, encryption, firewalls, and locking file cabinets. 

Are loan late or NSF charges included in the calculation of the maximum loan interest rate allowed under North Dakota Century Code 13-12?

No, the department’s application of the law for examination purposes is that the maximum charges are those present and calculated at the time of the execution of the credit or loan document.  Loan late or NSF charges are subsequent to the loan origination and are not included in the calculation. 

Are fees associated with additional products such as credit life insurance included in the calculation of the maximum loan interest rate allowed under North Dakota Century Code 13-12?

During an examination, the Department will review the fees and determine if they were necessary for the borrower to obtain credit.  If credit life insurance was required by the lender to obtain the loan, then the cost of credit life will be a cost of financing and included in the maximum loan interest rate calculation.  If the extension of credit was not contingent upon the sale of credit life, rather the credit life was a voluntary purchase by the borrower, then the fees are not included in the calculation.

Are NSF charges included in the maximum late payment charge allowed under North Dakota Century Code 13-12?

During an examination, the examiners will consider NSF charges charged by the third party the check was drawn upon which are levied against the residential mortgage lender and passed on to the borrower to be a collection cost and not be included in the $20 late fee cap.

Are loan advance fees on lines of credit included in the calculation of the maximum loan interest rate allowed under North Dakota Century Code 13-12?

No.  During an examination, the Department will not consider subsequent loan advance fees on lines of credit to be part of the maximum interest rate calculation. 

If a line of credit is originated with a maximum draw of more than $50,000 but the initial advance is less than $50,000, is this loan subject to the $20 late fee cap?

No.  During an examination, the Department will consider the origination amount to be the maximum available draw on the line of credit.  Since the origination was for more than $50,000, the cap will not apply.

Are third party loan related fees incurred by the lender and passed onto the borrower such as the cost of a credit report, mortgage filing, lien filing, or appraisal necessary for the extension of credit included in the maximum loan interest rate allowed?

No.  During an examination, the Department will not consider these in calculating the maximum interest rate allowed under North Dakota Century Code 13-12.16.

Are collection costs such as court fees included in the late fee allowed under North Dakota Century Code 13-12?

No.  During an examination, the Department will not consider these third-party charges in calculating the maximum late fee or maximum APR allowed under North Dakota Century Code 13-12.16.

What type of activity requires a North Dakota residential mortgage loan servicer license?

NDCC Section 13-13- 03. Except as otherwise provided, a person other than a residential mortgage loan servicer licensed and authorized under this chapter may not engage in residential mortgage loan servicing, either as a servicer, subservicer, or mortgage servicing rights investor, in the state without a residential mortgage loan servicer license issued by the commissioner. A person engages in residential mortgage loan servicing in the state if the borrower resides in North Dakota.

NDCC 13-12-02 (13) "Mortgage servicing rights investor" means entities that invest in and own mortgage servicing rights and rely on subservicers to administer the loans on their behalf. Mortgage servicing rights investors are often referred to as master servicers. (17) "Residential mortgage loan servicing" means receiving any scheduled periodic payments from a borrower pursuant to the terms of any federally related mortgage loan, including amounts for escrow accounts under section 10 of the Real Estate Settlement Procedures Act [12 U.S.C. 2609], and making the payments to the owner of the loan or other third parties of principal and interest and such other payments with respect to the amounts received from the borrower as may be required pursuant to the terms of the mortgage servicing loan documents or servicing contract. In the case of a home equity conversion mortgage or reverse mortgage as referenced in this section, servicing includes making payments to the borrower. (21) "Service or servicing a loan" means on behalf of the lender or investor of a residential mortgage loan: a. Collecting or receiving payments on existing obligations due and owing to the lender or investor, including payments of principal, interest, escrow amounts, and other amounts due; b. Collecting fees due to the servicer; c. Working with the borrower and the licensed lender or servicer to collect data and make decisions necessary to modify certain terms of those obligations either temporarily or permanently; Otherwise finalizing collection through the foreclosure process; or e. Servicing a reverse mortgage loan. (22) ""Servicer" means the entity performing the routine administration of residential mortgage loans on behalf of the owner or owners of the related mortgages under the terms of a servicing contract. (24) "Subservicer" means the entity performing the routine administration of residential mortgage loans as agent of a servicer or mortgage servicing rights investor under the terms of a subservicing contract. 

How can I determine if an individual or entity is licensed as a residential mortgage loan servicer in North Dakota?

The Department participates in the NMLS, as contemplated by the Secure and Fair Enforcement for Mortgage Licensing Act of 2008 ("SAFE Act").  Title V of this Act required each state to enact minimum standards regarding the supervision of mortgage entities.  The NMLS is a multi-state licensing system that allows companies and individuals to apply for and manager their licenses with each state through a secure and centralized website.  All non-bank and credit union companies licensed as residential mortgage lenders by our department are registered through the NMLS system.  You can determine whether a company or individual is a licensed residential lender in North Dakota by going to the NMLS Consumer Access portal:  http://www.nmlsconsumeraccess.org.

Who is exempt from licensure as a residential mortgage lender in North Dakota?

A list of individuals and entities exempt from residential mortgage lending licensure requirements is found under NDCC 13-13-04.

What are the requirements to be a residential mortgage loan servicer in North Dakota and how do I obtain a license?

Entities or individuals seeking a residential mortgage loan servicer license can do so by accessing the NMLS Resource Center:

https://mortgage.nationwidelicensingsystem.org/slr/Pages/DynamicLicenses.aspx?StateID=ND. A checklist of requirements is available on that site.

What are the fees associated with becoming a residential mortgage loan servicer in North Dakota?

North Dakota license fees include a $400 initial application fee and an annual license fee of $500 or $2.40 per $100,000 of North Dakota mortgage loans serviced, whichever is greater. This is required at each subsequent renewal.  In addition, licensees will be responsible for NMLS charges, including processing fees, criminal background check fees, and credit report check fees.

How often do I need to renew my residential mortgage loan servicer license in North Dakota?

All licenses issued by the Department are annual in nature and need to be renewed for each calendar year.  The renewal period begins November 1st and closes on December 31st of each year.

If I work for a licensed residential mortgage loan servicer, am I allowed to telework, work in a location other than the residential mortgage loan servicer's headquarters?

Yes, staff of a residential mortgage loan servicer may telework. Residential mortgage loan servicers and staff are expected to follow best business practices to safeguard both digital data and hard copy data.  Typically, this will include, in part, the use of VPN connections, encryption, firewalls, and locking file cabinets.