No lenders license in New Jersey - Posted by Tony in New Jersey
Posted by Tony in New Jersey on September 15, 2004 at 15:09:14:
After calling everyone and their brother in the New Jersey Dept of Banking and Insurance, I finally got someone who knew what type of license is required to take back mobile home notes in NJ. You MAY need a license… or then again you may not… read on.
If the CASH PRICE of the transaction for the mobile home buyer is UNDER $10,000, you will need a license. If it’s over $10,000 you don’t. I thought I heard it wrong, it must be the opposite. But no…that’s the way this early 1960’s law is written. The law is called the “Regional Installment Sales Act”. It was specially aimed at used car dealers selling low priced cars to low income people with abusive terms. New Jersey wants to regulate that transaction. I even had the Banking Dept email me a confirmation of it to be sure I understood it correctly.
EXAMPLE: You sell a MH for $9,000 and take back a note for $8,000. You need a lender’s license. You sell the same MH for $10,000 and take back a note for $8,000, you do not need a lender’s license.
In New Jersey that is not much of a problem because almost all retail MH deals have cash prices of over $10,000. If a similiar law is in effect in many low cost areas of the country, this could be a problem when you try to enforce a note that has gone bad.