Borrowing funds from a lender can be a good option when a Florida resident does not have sufficient funds to buy a property. Every loan must have a specific term, a timeframe for repayment, and specific terms outlining the consequences of default.
In this article, you will discover whether mortgage lenders need a license to operate in Florida.
Do You Need a License to Lend Money in Florida? – The Verdict
It is not possible to provide loans in Florida without proper licensing. Florida law has strict requirements to protect residents against lenders who fail to provide consumer protection to borrowers or charge unauthorized fees or rates.
Florida Statutes §494.00611 (1) expressly state that mortgage lenders need to register and obtain a proper license before lending funds to any person within state jurisdiction. This statutory rule applies to individuals who:
- Solicit or offer to solicit a mortgage loan (directly or indirectly)
- Accept or offer to accept an application for a mortgage loan
- Negotiate or offer to negotiate the terms/conditions of a new or existing mortgage loan on behalf of a borrower or lender, or
- Negotiate or offer to negotiate the sale of an existing mortgage loan to a non-institutional investor for compensation
The agency responsible for regulating and licensing the financial services industry in the state is the Florida Office of Financial Regulation (OFR). When applying for a lender license, applicants must meet the requirements outlined in Florida Statutes §494.00611:
- Submitting a completed application form
- Designating a qualified principal loan originator under the requirements of Fl. Stat. §494.00665
- Submitting a nonrefundable application fee of $500 (and a $100 nonrefundable fee if applicable)
- Submitting fingerprints for each of the applicant’s control persons under the rules established by the OFR
- Indicating whether the applicant will be seeking a servicing endorsement on the application form.
- Submitting a copy of the applicant’s financial audit report for the most recent fiscal year (pursuant to United States generally accepted accounting principles), and
- Authorizing the registry to obtain an independent credit report on each of the applicant’s control persons from a consumer reporting agency, and transmit or provide access to the report to the office
Applying for a Mortgage Lender License in Florida – Taking a Closer Look
Florida Statutes §494.00611(2)(h) requires applicants to “submit additional information or documentation requested by the office and required by rule concerning the applicant or a control person of the applicant.” Additional documentation may include:
- Pending and prior disciplinary and criminal history events, including arrest reports and certified copies of charging documents
- Plea agreements, judgments, and sentencing documents
- Documents relating to pretrial intervention
- Orders terminating probation or supervised release
- Final administrative agency orders, or
- Other comparable documents that may provide the office with the appropriate information to determine eligibility for licensure”
If the applicant fails to submit any required documents promptly or the documents submitted as part of the application do not meet the OFR’s licensure requirements, the board assessing the application will likely refuse to approve.
In most cases, it is possible to fulfill the existing gaps promptly and provide the missing documentation to the Office of Financial. If applicable, the applicant may also communicate with the office about the qualifications for licensure after submitting the pending documentation.