What if the applicant wants to be both a mortgage broker and a mortgage lender?
The licenses from certain states allow a licensee to broker and lend with only one license fee. Other states allow a licensee to broker and lend with one license by paying a separate fee for brokering and a second fee for lending. Other states have separate licenses for mortgage brokers and mortgage lenders.
Does a mortgage broker need a license to broker only one loan?
The answer depends on which state you want to broker a loan in. Certain states do exempt a small number of loans from the licensing requirement. However, before you broker even one loan without a license, you must check to ensure that the exemption still exists. The laws of each state change all the time.
Does an applicant need mortgage experience?
Certain states specifically stipulate a requirement of 18 months, two years, or 3 years of verifiable mortgage business experience (the application may require W-2 forms or letters from previous employers). Other states do not require any experience. We can advise you as to whether the state(s) you are interested in require mortgage industry experience.
Does an applicant need an office in the state to which I am applying?
About 30 states do not require an office in the state to which an applicant is applying. In states that do require an office, some states permit a home office, other states permit a home office only if the home is zoned for business use. We can advise you as to whether the state(s) you are interested in require an in-state presence.
Do the loan officers need to be licensed?
All states require loan officers (called mortgage loan originators) to be licensed. We can advise you as to what requirements your mortgage loan originators need to complete in order to get licensed.
Is any particular education required?
Yes, all states require pre-licensing education. Your loan officers (mortgage loan originators) must take 20 hours of pre-licensing education through an NMLS-approved provider. We can help you find a provider that is the most convenient for your mortgage loan originators.
Is a test required for an applicant?
Some states require a principal of the company to be licensed and part of that process will include passing a test. Other states only require principals of the company to be licensed if they will be originating loans. All states require individual loan officers to take an exam as part of their licensing requirements. We can advise you as to whether the state(s) you are interested in require an exam for your company’s principals.
We are a new company. Will this affect our ability to get a license?
Generally, no. Some states require a certain minimum net worth for the company and the applicant must produce a financial statement to prove that the company has the required net worth. In other states, where a minimum net worth is not required, the applicant must show that one of the owners has a certain minimum number of years experience in the loan origination business. Typically, that minimum is two or three years experience.
What is a surety bond and do I need one?
A surety bond is a contract with an insurance underwriter, which ensures that the banking department can collect unpaid fees from the licensee. The amount of the surety bond that is required varies by state.
How long will the licensing process take?
It can vary by state and by the time of year. Some state statutes mandate a decision on the license application within a certain number of days (i.e., 60 days or 90 days) after a complete application is received by the reviewer. In other states that do not have statutory decision requirements, the reviewers will put aside new applications when the renewal season starts. That will lengthen the review process. Additionally, if you are applying for a license in a state that is not your home state, you must first file an Application for a Certificate of Authority to transact business. You may also need to register an assumed business name (a DBA). This adds extra time to the process.
What services does the Gronsky Law Firm provide to an applicant?
We can prepare and submit a Certificate of Authority Application for existing companies to do business in another state. We can help you obtain registered agents and surety bonds. We will prepare and submit the license application, obtain the supporting documentation that the application requires and follow-up repeatedly with the Banking Department until a decision on your license application is received.
How do I get started with the Gronsky Law Firm?
Call or email us to let us know that you want to get started with us. We will prepare and send to you an Engagement Letter which details the services that we will provide to you. Upon receipt of the Engagement Letter, signed by you and accompanied by a retainer check, the Gronsky Law Firm can start working for you!
