In this chapter, the following terms have the meanings indicated. Terms Defined. “Advertisement” means a statement in any medium used or intended to induce any person to apply for a mortgage loan. “Annual percentage rate (APR)” has the meaning stated in 12 CFR Part 1026, as it may be amended from time to time. Applicant. “Applicant” means a borrower who has not received a commitment from a licensee to make the loan requested. “Applicant” does not include a person whose request for a mortgage loan has been denied. “Average prime offer rate” has the meaning stated in 12 CFR Part 1026, as it may be amended from time to time. “Borrower” has the meaning stated in Financial Institutions Article, §11-501, Annotated Code of Maryland. “Breach of the security of a system” has the meaning stated in Commercial Law Article, §14-3504, Annotated Code of Maryland. Broker. This section defines whether a person is acting as a broker or a lender in a particular transaction. For purposes of all Maryland laws and regulation applicable to mortgage lenders, a person is acting as a broker if: The person aids or assists a borrower in obtaining a mortgage loan for a fee or other valuable consideration; and The creditor identified in the loan documents is a different person than the person described in §B(7)(b)(i) of this regulation. There is no broker in a transaction solely because the lender contracts with a third party for processing or underwriting services if: The person contracting to perform the processing or underwriting did not generate the loan application; and The loan is closed in the name of the lender which did generate the loan application. “Commissioner” has the meaning stated in Financial Institutions Article, §1-101, Annotated Code of Maryland. “Commitment” has the meaning stated in Commercial Law Article, §12-125(a)(3), Annotated Code of Maryland. “Corporate governance” means the management structure of the licensee and the processes by which the business is managed, including the corporate controls, rules, policies, processes, and practices used to oversee and manage the institution. “Customer information” has the meaning stated in 16 CFR Part 314, as it may be amended from time to time. “Dwelling” has the meaning stated in Financial Institutions Article, §11-501, Annotated Code of Maryland. “Electronic record” has the meaning stated in Commercial Law Article, §21-101(h), Annotated Code of Maryland. “Escrow account” has the meaning stated in Commercial Law Article, §12-109(a)(3), Annotated Code of Maryland. “External audit” means the formal report prepared by an independent certified public accountant expressing an opinion on whether the financial statements are presented fairly, in all material aspects, in accordance with the applicable financial reporting framework, and is inclusive of an evaluation of the adequacy of a company’s internal control structure. “Financing agreement” has the meaning stated in Commercial Law Article, §12-125(a)(4), Annotated Code of Maryland. “Fully indexed rate” has the meaning stated in 12 CFR Part 1026, as it may be amended from time to time. “Higher-priced mortgage loan” has the meaning stated in 12 CFR Part 1026, as it may amended from time to time. “Information security program” has the meaning stated in 16 CFR §314.2, as it may be amended from time to time. “Initial application” means the submission of a borrower’s financial information in anticipation of a credit decision relating to a mortgage loan, which shall include the borrower’s name, the borrower’s monthly income, the borrower’s social security number to obtain a credit report, the property address, an estimate of the value of the property, and the mortgage loan amount sought. “Internal audit” means the internal independent and objective assurance and consulting activity performed to evaluate and improve the effectiveness of a licensee’s operations, risk management, internal controls, and governance processes. Lender. “Lender” means a person who makes a mortgage loan. “Lender”, as used in these regulations, does not include a person acting as a: Mortgage broker; or Mortgage servicer. “License” has the meaning stated in Financial Institutions Article, §11-501, Annotated Code of Maryland. “Licensed location” means any location listed by the licensee in NMLS. “Licensee” has the meaning stated in Financial Institutions Article, §11-501, Annotated Code of Maryland. “Loan” as used in these regulations, unless the context indicates otherwise, means a mortgage loan. “Loan application” has the meaning stated in Financial Institutions Article, §11-501, Annotated Code of Maryland. “Loss mitigation option” has the meaning stated in 12 C.F.R. Part 1024, as it may be amended from time to time. “Mortgage lender” has the meaning stated in Financial Institutions Article, §11-501, Annotated Code of Maryland. “Mortgage loan” has the meaning stated in Financial Institutions Article, §11-501, Annotated Code of Maryland. “Mortgage loan originator” has the meaning stated in Financial Institutions Article, §11-601, Annotated Code of Maryland. Mortgage Servicer. “Mortgage servicer” has the meaning stated in Financial Institutions Article, §11-501, Annotated Code of Maryland. “Mortgage servicer” includes a person that engages in one or more of the following actions for the benefit of other persons in connection with mortgage loans: Performs the routine administration of mortgage loans as agent of a servicer or MSR investor under the terms of a subservicing contract; Invests in and owns mortgage servicing rights and relies on subservicers to administer the mortgage loans on its behalf; Collects or receives payments directly from borrowers for distribution to the owner of the mortgage loan or another third party, including a master servicer; Evaluates borrower eligibility for loss mitigation options; Communicates with the borrower regarding loss mitigation options; Is responsible for supervision of third parties that take action to protect a secured party’s interest in the property under the applicable security instrument, such as maintenance of hazard and mortgage insurance coverage and preservation of the property; or Conducts or supervises the foreclosure process, except if the person is an attorney representing a mortgagee or its successors and assigns, or is acting as a substitute trustee in a foreclosure action under a deed of trust. “Mortgage servicing rights” or “MSR” means the contractual right to service a mortgage loan on behalf of the owner of the associated mortgage in exchange for specified compensation in accordance with the servicing contract. “MSR Investor” means a person who invests in and owns mortgage servicing rights and relies upon subservicers to administer the mortgage loans on the person’s behalf, and who may be referred to as a master servicer. “NMLS” has the meaning stated in Financial Institutions Article, §1-101, Annotated Code of Maryland. “Person” has the meaning stated in Financial Institutions Article, §11-501, Annotated Code of Maryland. “Processing”, when used in the context of processing a loan application, means the: Collection of data, documents, and other materials which a lender or broker requires in order to evaluate whether a loan will be granted or denied; Preparation of all materials necessary for closing a loan; and Scheduling of the closing of a loan. “Residential real estate” has the meaning stated in Financial Institutions Article, §11-501, Annotated Code of Maryland. “Risk management program” means the policies, procedures, and internal controls designed to identify, measure, monitor and mitigate risk. “Service provider” has the meaning stated in 16 CFR Part 314, as it may be amended from time to time. Social Media. “Social media” means an Internet website or application software that: Requires a person to register or create an account to become a member; and Allows two or more members to communicate directly with one another. “Social media” includes an Internet website or application software that allows members to communicate by means of one or more of the following: Text; Video; Still photograph; or Audio. “Social media” does not include an electronic mail account. “Subservicer” means a person performing the routine administration of mortgage loans as an agent of a servicer or MSR investor under the terms of a subservicing contract. “Trade name” means any word or group of words used to identify a business to the public. “Underwriting” means the evaluation of information and materials about the loan, the applicant, and the property which will secure the loan, to determine whether the loan will be made or denied.