Ability Of Licensed Mortgage Broker To Do Business With Its Mortgage Lender Parent Company
Regulations promulgated pursuant to Mass. Gen. Laws c. 255E, at 209 CMR 42.04(4) and 42.07(4) prohibit a licensed mortgage lender that also is a licensed mortgage broker, or vice versa, from simultaneously acting as a lender and broker in the same transaction. It is the Division's long-standing position that the prohibitions of said regulations do not apply where a lender and broker operate their businesses independently from each other and neither entity receives any fees, directly or indirectly, from the other entity within the same transaction. See Opinion # 93-001. A mortgage lender which owns a partial interest in a company which will become a Commonwealth-licensed mortgage broker, may do business with said partially-owned subsidiary broker so long as the two entities act independently and neither receives fees from the other.
This situation is not changed by the fact that the mortgage lender parent company is a licensed small loan agency in the Commonwealth. A parent company that is exempt from the licensing requirements of M.G.L. c. 255E, due to its small loan agency status, still must comply with the other provisions of said chapter and the regulations promulgated pursuant to said chapter, including 209 CMR 42.04(4) and 42.07(4).
People also viewed...
You recently viewed...
Personalization is OFF. Your personal browsing history at Mass.gov is not visible because your personalization is turned off. To view your history, turn your personalization on.
Learn more on our .
*Recommendations are based on site visitor traffic patterns and are not endorsements of that content.