Changing Rules for Loan Officer Licensing

Over the next year, many states who do not currently license loan officers will start doing so. The push comes from a belief that registration/licensing will improve the professionalism of loan officers. The various states that already have loan officer licensing require pre-licensing education or experience, registration or licensing of the individual loan officers, and continuing education needed for renewals of the registration or licensing. The new states will have similar requirements but each state will have a different date for starting the registration/licensing process and who is required to comply.

I will be keeping readers of this blog up-to-date with the new loan officer regulations as the states roll out their new regulations. This will allow you plenty of time to familiarize yourself with your state's new requirements and to get you ready for compliance with the new law.

License Expiration Dates

If your company has more than one license, someone needs to keep track of your license expiration dates so that you do not let any license lapse. A very few states have licenses that never expire so you only have to keep track of other compliance issues such as annual reports.
If you are in a large mortgage company, you probably have a compliance department and it is their job to keep track of all expiration dates. But if you don't have a compliance department, you need a compliance person. In a very small company, that person might be the owner. Or it might be an administrative assistant. You might even outsource the function to a law firm or company that provides compliance services. I have several clients that just send me all of the compliance paperwork that they receive from the various banking departments and secretaries of state.

I have a calendar marked with all my clients' license expiration dates and also marked about 2-1/2 months before each license expiration date. At 2-1/2 months before each expiration date, I send emails to my clients reminding them that they should be receiving renewal materials from the banking department and that they should forward them to me as soon as they receive them. I start the renewal process as soon as the state permits so that I can get any additional information that is required from the client. For example, in states that require continuing education, the license renewal application asks for details about what courses were taken and who the education provider was.

If you are keeping track of your own license expiration dates, you need to set up your own system so that you get the renewal process completed before the expiration date. In some states, going past the deadline means you pay a late fee. In other states, you might need to start all over with the application process and that can take several weeks, time that you cannot take in any new applications in that state.And who can afford that?

Subleasing Office Space

When times are tough, the way they are now, some companies find that they must reduce expenses. The fastest way to do this is to close offices and lay off staff.

When you close an office, you will frequently find that your lease does not let you just walk away with no repercussions. Most leases require that you pay rent until the end of the lease term (which could be years away). If you stop paying rent, your landlord will sue you for the rent for the balance of the lease term.

However, most leases will let you assign or sublet your space. If you can find another company who wants your office space and the landlord approves the new company, you won’t be sued for breaking the lease. You still will remain liable if the new tenant doesn’t pay but it will save you plenty of money until that problem happens, if it ever does.

How do you find this new company? Talk to a commercial real estate agent. The more time left on the lease, the more money you have at risk for breaking the lease.

What if you are looking for new office space – either because you are expanding or contracting? Also check out space that is being sublet. Plenty of companies are going out of business or just consolidating space so there are a lot of options out there that could offer you a very cheap rent.

Whatever you do, consult a lawyer before entering into a sublease. It is a much more complicated document that a regular lease so you need expert advice before you sign on the dotted line.