Iowa Amends Mortgage Law, Adds Remote Work Provision

Iowa recently amended its mortgage law to add remote work provisions for licensees, as well as corporate governance and financial condition provisions for certain mortgage servicers.  Previously, the Iowa Division of Banking had issued continuing Guidance on July 26, 2021, allowing remote work subject to certain conditions.

Under the new remote work provisions certain requirements must be met for a licensee to allow remote work.  The requirements are similar to those in the prior Guidance, and include, but are not limited to:

• No in-person customer interaction at the remote location;
• No physical records maintained at the remote location;
• Written policies and procedures ensuring remote workers’ compliance with applicable laws;
• Maintenance of computer systems that allow remote work, and maintenance of customer information in compliance with the licensee’s information technology and security plan;
• Remote worker access to the licensee’s system through VPN or a similar secure system;
• Remote lock or erasure capabilities on all remote devices;
• Ensuring appropriate security systems are installed, updated, and patched;
• Compliance with information security requirements for customer interactions, such as in the Gramm-Leach-Bliley Act;
• Designating a licensed location in NMLS for any mortgage loan originator working remotely; and
• Licensee’s annual certification of compliance with these requirements.

The law also includes new corporate governance and financial condition provisions for certain mortgage servicers.  These provisions focus on establishing a strong oversight structure and maintaining financial stability.  They include requirements such as:

• An oversight board that, among other things, establishes a written corporate governance framework and internal audit requirements;
• An annual external audit of financials and internal controls;
• An annual risk management assessment;
• Maintaining sufficient allowable assets for both operating liquidity and servicing liquidity requirements; and
• Maintaining written policies and procedures for implementing capital and liquidity requirements.

The provisions become effective on July 1, 2024.