One of the most vexing problems that mortgage brokers and lenders face when they wish to expand their territory is the requirement of some states that they have a "brick and mortar" presence in that state. What is a "brick and mortar" presence? It means a physical office in that state.
Currently, about 2/3 of the states do not require an office in their state. This makes them very popular in terms of getting a license. But there are some very lucrative states, including Texas, New Jersey, Pennsylvania and Arizona, where a mortgage broker or lender must have a physical office in those states in order to get a license. Georgia requires an office if your home states requires an office.
What constitutes an office? Again, it varies by state. Many states permit home offices, other states permit home offices if the town zoning laws permit that home office to exist. Some states permit executive suites so long as the suite is a fully enclosed office in which customer files can be locked away. If the "office" consists of a desk in a shared room with a common receptionist, that will not qualify as an office.
If you intend to get a license in a new state where one of your loan officers is living or intends to live, and they have a "brick and mortar" requirement, first find out whether a home office will qualify. That is your cheapest option. If the state does not permit home offices, find the cheapest office arrangement in that state. Especially in this age of customers finding a new mortgage loan on the internet, your office doesn't have to be the nicest one in the largest city, where the rents are the highest. Chances are your customers will never see your office so conserve your cash.
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