Most companies do not realize that you cannot just start doing business in another state without filing certain documents with that state’s government. The document is usually called an “Application for Certificate of Authority to Transact Business.” In most states, it is filed with the Secretary of State.
The Application usually requires you to list who the officers and directors (or members of the limited liability company) are, their home addresses, and the name and address of the registered agent. A registered agent is the person or company located in that state who is authorized to receive service of process or any legal documents on your behalf. Although the filing of the Application for Certificate of Authority is fairly automatic, it can be rejected if your company name is already taken by an existing company or if that state requires that you first get permission from the banking department to use your name. In some states, certain words trigger the permission issue, words like “mortgage,” “finance” or “loan.” If that state requires banking department approval, they could prevent you from using your real company name if they believe that it is “confusing” (this could mean either another company has a similar name or that you are a mortgage broker with the word “banker” or “lender” in your company name). In that case, you must use an assumed business name (also known as a “dba”) in that state.
You cannot get a mortgage broker/lender license without first getting the Certificate of Authority since every application asks for the date on which you received your Certificate of Authority.
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