
                         Roanoke Times
                 Copyright (c) 1995, Landmark Communications, Inc.

DATE: SATURDAY, March 28, 1992                   TAG: 9203280085
SECTION: BUSINESS                    PAGE: A-8   EDITION: METRO 
SOURCE: SANDRA BROWN KELLY BUSINESS WRITER
DATELINE:                                 LENGTH: Medium

SCC CURBS BROKER

Virginia State Mortgage Inc., a Roanoke County loan broker, has been ordered by the State Corporation Commission to stop acting as a lender, but it also has been told to continue its application for a lender's license.

SCC officials confirmed Friday they issued a cease-and-desist order March 11 against the company. The order was the result of a June 1991 investigation that concluded Virginia State Mortgage had closed more than 10 mortgages in its own name over a 12-month period, which meant it was acting illegally as a lender.

The SCC ordered the company, owned by Jennifer Jacob-Ayers, to quit the practice until she is licensed as a lender.

Ayers has been a licensed mortgage broker since January 1988. Under state law, a broker is allowed to find and negotiate loans but cannot close loans in its company name. Acting as a lender without a license is a felony, said the SCC. A mortgage broker does not lend money but matches borrowers with investors.

Ayers said Friday she has quit closing loans in her company name, but she thought what she was doing was OK because she had applied for a lender's license.

The SCC's Bureau of Financial Institutions and Ayers have had extensive correspondence regarding an application she submitted in August to be licensed as a lender.

According to their letters, Ayers and the bureau have disagreed on what documentation she needed for the $200,000 line of credit or funds on deposit that is required of a lender.

Sidney A. Bailey, commissioner of the bureau, denied Ayers' lender's license in early March, saying his office hadn't received the required documentation within proper time.

Bailey said he told Ayers, through her attorney, that she could appeal the denial or file a new application, do both or do nothing.

Ayers filed another application, although she said she verbally withdrew it late last week in anger. Bailey said he considers the application current until he receives a written withdrawal request.

Bailey said the SCC's "patience has been quite considerable in this case."

Ayers said Friday her patience is almost exhausted, but she hasn't decided what she will do about the application.

"According to my attorney, I have complied with the state's order," she said. "And I'm going to continue as a mortgage broker."

Business writer Charlyne H. McWilliams contributed to this story.

by CNB