Code of Massachusetts Regulations
209 CMR - DIVISION OF BANKS AND LOAN AGENCIES
Title 209 CMR 42.00 - The Licensing Of Mortgage Lenders And Mortgage Brokers
Section 42.05 - Application Procedure - Mortgage Brokers
Universal Citation: 209 MA Code of Regs 209.42
Current through Register 1531, September 27, 2024
(1) Application. Each Applicant for a license as a mortgage broker shall submit an application for licensure through the NMLS, containing such information as the Commissioner may require.
(2) License Requirements. An Applicant shall be required to submit detailed information supporting the following general requirements:
(a)
Financial
Responsibility. An Applicant shall demonstrate financial
responsibility and shall maintain:
1. a net
worth of not less than $25,000;
2.
a bond of $75,000 in such form and with such sureties as may be approved by the
Commissioner. The surety bond must contain a clause that the insurance company
will notify the Commissioner at least 30 days prior to canceling the surety
bond for any reason. The Commissioner shall automatically suspend the license
on the date the cancellation takes effect, unless the surety bond has been
replaced or renewed; and
(b)
Financial
Statements. An Applicant shall submit financial statements
prepared in accordance with generally accepted accounting principles meeting
the following minimum requirements:
1.
Contents. The financial statements required by 209 CMR
42.05(2)(b) shall include, but are not limited to, a Balance Sheet, Income
Statement, Statement of Cash Flows, and Statement of Changes in Stockholders'
Equity and all relevant notes thereto. If an Applicant's audited or reviewed
financial statements are consolidated, the Applicant shall include supplemental
statements for each of the consolidated entities.
2.
Initial
Application. An Applicant under 209 CMR 42.05(5)(b)2. shall submit
financial statements for the preceding fiscal year that have been audited or
reviewed by an independent certified public accountant and such other financial
information as the Commissioner may require.
3.
Renewal
Applications. Within 90 days of the close of its fiscal year, an
Applicant for license renewal shall submit financial statements for the
preceding fiscal year that have been audited or reviewed by an independent
certified public accountant and such other financial information as the
Commissioner may require.
4.
Scope. An Applicant's audited financial statements
shall be performed in accordance with generally accepted auditing standards and
reviewed financial statements shall be performed in accordance with the
Statements on Standards for Accounting and Review Services issued by the
American Institute of Certified Public Accountants.
(c)
Character and
Fitness. An Applicant shall submit information demonstrating that
the Applicant possesses the character, reputation, integrity and fitness to
engage in the business of a mortgage broker in an honest, fair, sound and
efficient manner.
(d)
Business Experience. An Applicant shall demonstrate to
the Commissioner's satisfaction that the Applicant, and its applicable officers
and employees, possess the necessary educational and business experience to
engage in the business of a mortgage broker.
(e)
Other
Information. An Applicant shall submit such other information the
Commissioner may deem necessary to properly evaluate an application. In
evaluating an application and requesting information from an Applicant, the
Commissioner may be guided by or rely upon the standards set forth in the
CSBS/American Association of Residential Mortgage Regulators NMLS
Policy Guidebook, as published by the SRR.
Disclaimer: These regulations may not be the most recent version. Massachusetts may have more current or accurate information. We make no warranties or guarantees about the accuracy, completeness, or adequacy of the information contained on this site or the information linked to on the state site. Please check official sources.
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