NEW JERSEY MORTGAGE LENDER LICENSING REQUIREMENTS

EXEMPTIONS

l Depository institutions and insurance companies (but subsidiaries and service corporation of these
institutions or companies are not exempt).

l A person making, acquiring or selling mortgage loans for private investment or gain and not in the regular
course of business (only a person not engaged in the financial services industry who makes one or two
mortgage loans in a calendar year, or a person employed in the financial services industry who makes one or two
private mortgage loans in a calendar year outside of his employment, shall qualify).

l An attorney of New Jersey not actively and principally engaged in the business of a mortgage banker or
broker, when the attorney renders services in the course of his practice.

l A person licensed as a real estate broker or salesperson pursuant to R.S. 45:15-1 et seq., and not engaged in
the business of a mortgage banker or broker.

l Builders who secure mortgages for their own construction or for sale of their own construction.

(N.J.S.A. 17:11C-4)

INITIAL APPLICATION

l A person applying for an initial license pursuant to the Act shall submit the following:

- A completed application form as prescribed by the Commissioner of the Department of Banking and Finance
which shall include the following:

- The name of the applicant, including any trade name or doing business name.

- The location of the principal New Jersey place of business.

- Information regarding officers and stockholders.

- The name and address of the applicant’s registered agent in New Jersey.

- Information regarding incorporation, registration and authorization to do business in New Jersey.

- The applicant’s Federal Tax Identification Number or Social Security Number, as applicable.

- Certified consent certificates permitting the Department to make inquiries to the Division of Criminal Justice
as to any information it may have on file with respect to the applicant, that is, the person, sole proprietor,
partners, corporate officers, directors and shareholders owning 10 percent or more of the shares of the
corporation.

- An original executed bond, on bond forms issued by the Department, from a surety company authorized to
do business in this state, which bond meets the requirements of N.J.A.C. 3:15-3.1.

- A letter from a surety company authorized to do business in New Jersey stating that the applicant has
satisfied all the requirements for the issuance of a surety bond.

- An unqualified audited financial statement prepared by a certified public accountant or a public accountant,
in good standing, demonstrating proof of net worth.

- An application for a corporate license by a corporation organized under the laws of New Jersey shall be
accompanied by a copy of the certificate of incorporation, and a foreign corporation shall submit a copy of its
certificate of incorporation and a copy of its certificate of authority approved by the New Jersey Secretary of
State.

- An application for a sole proprietorship or partnership where a trade name is to be used shall be
accompanied by a trade name certificate filed with the County Clerk’s office and any filing made with the
Secretary of State.

- The biennial license fee as specified in N.J.A.C. 3:15-4.4.

- The application fee as specified in N.J.A.C. 3:15-4.3.

- A completed branch office application as specified in N.J.A.C. 3:15-2.4, if applicable.

- Prior to being licensed, each applicant for an individual or sole proprietor license shall pass an examination
administered in accordance with N.J.A.C. 3:15-2.9.

(N.J.S.A. 17:11C-7; N.J.A.C. 3:15-2.2)

l No corporation, partnership, association or any other entity shall be issued or hold a license as a mortgage
banker or broker or secondary lender unless one officer or principal has an individual license of that same type
sought or held.

l If the employed individual licensee allows his license to lapse or for some other reason is no longer affiliated
with the employing licensee, the employing licensee shall notify the Commissioner within ten days and shall
appoint another licensed individual within 90 days.

(N.J.S.A. 17:11C-3)

l Each applicant for a license as a mortgage banker shall demonstrate that it has tangible net worth of $250,000,
except that an applicant for a correspondent mortgage banker license shall demonstrate that it has tangible net
worth of at least $150,000.

l In the case of the application of an officer, partner, member, employee or other principal of a corporation,
partnership, association or other entity, that individual shall not be required to demonstrate that the individual
has the tangible net worth required.

(N.J.S.A. 17:11C-14)

l A licensee shall obtain a license for each branch office.

- The application for a branch office license shall include the following:

- The name of the licensed entity, including any trade name or “doing business as” name to be utilized.

- The address of the principal New Jersey place of business.

- The addresses of all branches to be licensed.

- A branch application fee as required by N.J.A.C. 3:15-4.3.

- The branch license fee as specified in N.J.A.C. 3:15-4.4.

- A licensee does not need to obtain a branch office license for an attorney’s office merely because loans are
closed there and fees are received there incident to the loan closing.

l The Commissioner shall determine whether the proposed branch is a suitable location in determining whether
to approve a branch application.

(N.J.A.C. 3:15-2.4)

l A person who seeks an initial license to engage in the mortgage banking, correspondent mortgage banking
business, mortgage brokering business or secondary mortgage loan business shall obtain a bond for the initial
licensing period prior to submitting the first annual report as follows:

- One licensed authority--$50,000.

- Two licensed authorities--$75,000.

l Upon submission of an annual report, licensees shall increase the amount of the bond based on the following
closed loan volumes and provide proof thereof to the Department within 60 days.

- One licensed authority:

- Closed loan volume--$0 to $50,000,000: $50,000

- Closed loan volume--$50,000,001 to $75,000,000: $75,000

- Closed loan volume--$75,000,001 to $100,000,000: $100,000

- Closed loan volume--$100,000,001 and over: $125,000

- Two licensed authorities:

- Closed loan volume--$0 to $50,000,000: $75,000

- Closed loan volume--$50,000,001 to $75,000,000: $100,000

- Closed loan volume--$75,000,001 to $100,000,000: $125,000

- Closed loan volume--$100,000,001 and over: $150,000

(N.J.A.C. 3:15-3.1)

RENEWAL

l Each license shall expire at the end of the biennial period.

l The first biennial period shall begin on June 30, 1997, and shall end on June 30, 1999.

l A person who submits a renewal application after the expiration of the license, but no later than 30 calendar
days after such expiration, may renew by paying a refiling fee of $500.

- Thirty-one calendar days after the expiration of the license but no later than 60 calendar days after such
expiration, may renew by paying a refiling fee of $150.

- Sixty-one calendar days after the expiration of the license but no later than 90 calendar days after such
expiration, may renew by paying a refiling fee of $300.

- Thereafter must submit application for an initial license.

(N.J.S.A. 17:11C-11; N.J.A.C. 3:15-2.6)

STATE FEES AND CHARGES

l Initial nonrefundable application fee of $300.

l Initial branch office nonrefundable application fee of $200.

l Biennial license fees and renewals thereof shall be determined by the Commissioner and varies depending
upon the number of licensed activities in which the licensee is engaged.

(N.J.S.A. 17:11C-8; N.J.A.C. 3:15-4.3, N.J.A.C. 3:15-4.4)

MISCELLANEOUS

l The license shall state the name of the licensee and the licensee’s place of business or businesses, as
applicable, and shall contain such other information as the Commissioner may see fit to require.

l The license shall be posted conspicuously in the place or places of business of the licensee.

l Licenses issued shall not be transferable or assignable, other than as provided by 17:11C-12.

l No licensee shall change the name or address of the licensee’s place or places of business without notice to
the Commissioner.

(N.J.S.A. 17:11C-10)

l Any sale or transfer of a controlling interest in a licensee’s business shall be approved by the Commissioner
prior to the transfer, after the licensee or applicant has provided written notice of the proposed sale or transfer to
the Commissioner.

l The Commissioner shall approve the transfer unless the Commissioner determines, following an opportunity
for a hearing, that sufficient grounds exist to deny, revoke or suspend the license.

l The sale or transfer shall be deemed approved if the Commissioner does not deny the application within 30
days after receipt, or ten days when the sale or transfer is to another licensee.

l The Commissioner may charge such fee as set by regulation, not to exceed $200, for considering an
application for a sale or transfer of a controlling interest.

(N.J.S.A. 17:11C-12)

3A depository institution is defined under the Act to mean a state or federally chartered bank, savings bank,
savings and loan association, building and loan association or credit union. (N.J.S.A. 17:11C-2)