Mortgage & Consumer Finance Lead Generator Licensing
It is important for companies involved in the mortgage and finance lead generation business to be aware that their solicitation activities may trigger the need to be licensed under state mortgage and finance licensing laws. These companies should take measures to ensure that they are in compliance with state and federal lending and licensing laws.

In order to determine whether or not a state license is required for lead generators, a two-step analysis is required. First, it is necessary to carefully read state licensing statutes and regulations. Most states define the activities of a mortgage broker, mortgage banker, or consumer finance company very broadly, using many all-encompassing action verbs (e.g. soliciting, processing, placing, negotiating, assisting, etc.). “Soliciting” or "assisting" customers triggers the license requirement.

Second, it is then necessary to contact each state regulator and request a written opinion as to licensing requirements based upon the specific business model of the lead generator. Every lead generator conducts its business differently, requiring that a new analysis be required for each mortgage lead generator.  Alternatively, the advice and opinion of a regulatory compliance attorney should be obtained.

Should a mortgage license or finance license be required, lead generators will be subject to the same laws, requirements and restrictions as companies that originate such loans.

After a licensing determination has been made, it is then necessary to determine which state and federal lending laws are applicable to the proposed lead generation activity.

Because of the large downside risks associated with conducting an unlicensed lead generation business, and with not being in compliance with state and federal lending and licensing laws, it is critical that each mortgage and finance lead generator seek the advice of finance industry counsel prior to engaging in mortgage lead generation or consumer finance lead generation activity in any state.

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We take care of the licensing, so that you can take care of the lending! SM