Re: Licenses for Cash Flow business - Posted by Matthew Chan
Posted by Matthew Chan on February 07, 2000 at 11:12:17:
I have looked into this for myself in GA and found the following…
7-1-1000 (11) “Mortgage broker” means any person who directly or indirectly solicits, processes, places, or negotiates mortgage loans for others, or offers to solicit, process, place, or negotiate mortgage loans for others or who closes mortgage loans which may be in the mortgage broker’s own name with funds provided by others and which loans are assigned within 24 hours of the funding of the loans to the mortgage lenders providing the funding of such loans.
(12) “Mortgage lender” means any person who directly or indirectly makes, originates, or purchases mortgage loans or who services mortgage loans.
7-1-1002 (b) On and after July 1, 1995, it is prohibited for any person, as defined in Code Section 7-1-1000, including a corporation but not including any natural person who purchases five or fewer mortgage loans in any one calendar year, knowingly to purchase, sell, or transfer one or more mortgage loans from or to a mortgage broker or mortgage lender who is neither licensed nor exempt from the licensing or registration provisions of this article. Such a purchase shall not affect the obligation of the borrower under the terms of the mortgage loan. The department shall provide for distribution or availability of information regarding approved or revoked licenses.
What does this mean to me?
I am NOT a mortgage broker because I am not “solciting, processing, placing, or negotiating” for anyone else for myself. I make it clear to everyone, I look for myself. Anything else I don’t want are simply referrals and let the funding company handle it. Or if you happen to take a note in your name, assign it 25 hours after the funding.
Regarding your statement of the five or more transactions, it actually says “five or less”. It says that you don’t want to “purchase, sell, or transfer” to transact with an UNLICENSED mortgage broker or mortgage lender. So I take that to mean, you can do some transactions, if they are licensed in GA.
If you buy for yourself or your IRA account, I don’t see a conflict here. Just stay away from “owning” a note you don’t plan on keeping. Stick to referrals so that you are not representing anyone.
Bottom line, I just exercise some caution when I deal with the public. I don’t accept the broad generalization you posted. But, then again, I rarely accept any one’s! I got to know for myself and make my own determination.
I admit the laws and code are a little inconvenient which would restrict all the things you might like to do, but they don’t look like insurmountable obstacles.
Now, are you comfortable with doing that? I don’t know. Everyone makes their own choices in life…