"An Act relating to mortgage lenders and persons who engage in activities relating to mortgage lending; and providing for an effective date. "

Alaska is the very last state not to license and regulate residential mortgage lending. Because of this fact, the Alaska Division of Banking and Securities has no authority to investigate the more than 20 complaints and over 50 phone calls it receives weekly about questionable lending practices, and can do nothing to protect Alaska consumers from fraud, questionable lending or brokering practices. Increased access to internet lending in recent years has contributed even further to the growing number of complaints and has caused the U.S. Congress to seek ways to strengthen consumer protection in an area representing, to some, the largest single investment they will make in their lifetime.

Recognizing this problem, the mortgage lending industry in Alaska has been meeting for several years to develop legislation to balance protection of Alaska’s consumers while insuring sufficient access to residential mortgage loans.

During the past year the Alaska Division of Banking and Securities has worked closely with several leading Alaska mortgage lending groups to develop legislation to address this problem but to date no consensus, one acceptable to everyone, has been found. However, the concept of an attempt to regulate the mortgage lending industry in Alaska and is supported by the Alaska Division of Banking and Securities, the Alaska Mortgage Bankers Association, the Alaska Mortgage Brokers Association, the Independent Lenders of Alaska, the Alaska Realtors Association and the AHFC.

CSHB 424 has been introduced as a starting point to address this problem and grant the Division enough licensing and regulatory authority to begin addressing the growing number of complaints Alaska home buyers are experiencing.

This legislation does not address, and will not solve, all the issues Alaskan home purchasers face, but it is a strong first step. Additionally, more controversial legislation, addressing loan originators and other issues needs to be pursued. This effort to establish accountability in the mortgage lending industry in Alaska is vital and past due.

I urge your support for CSHB 424.

24-LS1504\F

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