Wednesday, November 21, 2007 - IS YOUR ENTITY LICENSED IN TX? IF NOT YOU ARE GUILTY OF UNLICENSED ACTIVITY!

IS YOUR ENTITY LICENSED IN TEXAS?

IF NOT YOU WILL BE GUILTY OF UNLICENSED ACTIVITY!

A message from Harry Dinham, NAMB Past President

While at the Mortgage Broker Advisory Committee last week comments and concerns were raised about the lack of applications for the entity license. I believe the number that the commissioner mentioned was 140. Every licensed mortgage broker who doesn't operate as schedule C under their personal tax returns must obtain an entity license.

There are more than 5,000 brokers licensed in the state and only 140 have submitted applications for entity licenses. This application must be submitted prior to January 1, 2008 when these changes take effect. Below you will find the SML department's language from their website. Please don't delay too long because if you continue to operate under a company name without the entity being licensed after January 1, it will be considered unlicensed activity.

If a broker operates with a company name, those companies now have to be licensed. No one (mortgage broker or loan officer) can be individually licensed without their companies licensed (if they have one). In order for the company entity to become licensed, the entity must designate an individual licensed as a mortgage broker as its designated representative and pay an application fee in an amount not to exceed $175. That designated representative must the sole proprietor if the company is a sole proprietorship, be an officer of the corporation if it is a corporation, a manager of the limited liability company if it is a limited liability company, or if the company is a limited partnership the designated representative must be a general partner, an officer of a general partner that is a corporation, or a manager of a general partner that is a limited liability company.

Not later than the 10th day before a mortgage broker begins doing business under an assumed name, the broker shall file with the Commissioner a copy of an assumed name certificate for each assumed name under which the mortgage broker intends to conduct business and pay a $25 registration fee for each assumed name. A loan officer may not conduct business under any assumed name that is not the registered assumed name of the sponsoring broker.

Licensees must notify the Commissioner not later than the 10th day after the date of any change of the person's name and pay a fee of $25 for the name change and issuance of an amended license certificate.

A business entity licensed under this chapter shall notify the Commissioner of any change of its designated representative and pay $25.00 for each change.

Harry H Dinham, CMC