Mortgage Licenses and Annual Reports

Once you have your license as a mortgage broker or lender, you still have regular contact with the agency that granted you the license. Just about every state requires an Annual Report. Most of them are due in the first 4 months of each year.

The first one that you file is obviously the most daunting. You've never seen the form before, you didn't know that you should keep the information that is being asked for and they may even require that you input the information onto their form online.

The states will send out a reminder that the Annual Report is due in 2 months (this is the typical amount of notice that the states give). At this point, you should appoint someone in your office to gather the information that will be needed for each state. Although some of the information is common to all of the Annual Reports (i.e. information on your profit and loss statement and your balance sheet), how many loans and the total dollar ammount of the loans you closed in Virginia will not help you with the California Annual Report. Depending on how many states you are licensed in, this can be a very time-consuming job. And that person needs to keep track of the dates that each Annual Report is due.

For states that require that you submit certified financial statements each year, you have to give your accountant enough notice so that this work can be squeezed into his busy tax season. Most states do not have any mechanism for allowing an extension of time if your accountant can't get your certified financial statement together on time. You will be facing fines and penalties from each state in which your financial statement is late.

The second year and every year after should be easier when you know what will be asked for. Just create a computer program to store and retrieve the information that you know each state will need. But also be aware that each state can ask for additional information that it had not asked for in the previous year.

There is plenty of aid out there to help you get your information organized and inputted on the Annual Report form so that your filing is timely. You really do not want to be late. The penalty may exceed the cost of hiring someone to help you.