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Unlicensed Commercial Mortgage Broker?

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mushroom51

Junior Member
What is the name of your state (only U.S. law)?Michigan

I need clarification regarding the licensing requirements to originate commercial mortgages in Michigan. I read the statutes and spoke to the Division of Real Estate and am getting conflicting information. The Mortgage Loan Originator Licensing Act only refers to residential mortgages affecting 4 units or less. The Consumer Mortgage Protection Act states the same thing EXCEPT for the origination of a commercial mortgage that includes a residential property of 4 units or less (whether attached, cross collateralized) then a licence is required otherwize it is not. Speaking with the DOR I was told that in order to originate commercial loans, a Real Estate Broker license is required. I am a licenced RE Broker in another state but Michigan does not have license resiprosoity. I have several potential transactions pending but can't proceed untill I get a clear answer. Any information would be apreciated.What is the name of your state (only U.S. law)?What is the name of your state (only U.S. law)?
 


HomeGuru

Senior Member
What is the name of your state (only U.S. law)?Michigan

I need clarification regarding the licensing requirements to originate commercial mortgages in Michigan. I read the statutes and spoke to the Division of Real Estate and am getting conflicting information. The Mortgage Loan Originator Licensing Act only refers to residential mortgages affecting 4 units or less. The Consumer Mortgage Protection Act states the same thing EXCEPT for the origination of a commercial mortgage that includes a residential property of 4 units or less (whether attached, cross collateralized) then a licence is required otherwize it is not. Speaking with the DOR I was told that in order to originate commercial loans, a Real Estate Broker license is required. I am a licenced RE Broker in another state but Michigan does not have license resiprosoity. I have several potential transactions pending but can't proceed untill I get a clear answer. Any information would be apreciated.What is the name of your state (only U.S. law)?What is the name of your state (only U.S. law)?
**A: what did the state regulatory agency tell you.
 

mushroom51

Junior Member
The DOR seemed unsure but told me I needed a RE Broker license. According to the Consumer Mortgage Protection Act - MCL445.1631 et. seq (revised 10/1/10) " Commercial Loans are subject to the Act only to the extent a commercial loan transaction includes a lien on residential property". According to the Michigan Mortgage Brokers Licensing Act, MCL445.1651 et. seq "A Mortgage loan means a loan secured by a first mortgage on real property ...... designed for occupancy by 4 or fewer families************** etc." Last effective date was 07/31/10. Nowhere could I find language specific to commercial transactions. Don't really want to do the 130 hours fo a RE Broker license if I don't have to but also want to be in compliance with the law.
 

Regulator2011

Junior Member
I am an examiner/investigator with OFIR in Michigan. We regulate residential mortgage loans, not commercial. There are no laws in Michigan that regulate commercial loans. Since I do not regulate real estate licensure and DOR told you that you needed a RE license, then they know. I can simply tell you that there are no regulations for commercial loans (except what you cited in CMPA). If you ever have questions about mortgage loan regulations in the State of Michigan, please contact OFIR/ MEIS (Mortgage Examination and Investigation Section) at 1-877-999-6442 or visit our website at DELEG - Office of Financial and Insurance Regulation

Thanks....:)
 

mushroom51

Junior Member
Thank You to Regulator2011 for your response. I am still awaiting another opinion from DOR regarding licensing for commercial mortgages. Anticipating that I will need the RE Broker licence, I have pulled out my books just in case. Doesn't hurt to review anyway. I'm sure at some point I will be in contact with your office as I am anxious to learn all I can about practicing Real Estate/Mortgages in Michigan as all states are different.(except for NMLS, SAFE etc). If you would like I can keep you informed of what I discover either on this forum or email - [email protected]
 

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