A company holds a CFL finance broker license and now wants to lend its own funds to about 80 California consumers a year. Does the existing finance broker authority alone authorize lending the company’s own money?
Correct Answer
D) It needs lender authority too: broker and lender are separate activities
A finance broker license authorizes brokering loans to finance lenders; lending one's own money is the lender activity and needs that authority, the license being activity-specific rather than one unrestricted permission. Other choices: brokering is not the wider authority; there is no 25-loan allowance; and the broker license is not surrendered to add lender authority. Source: Cal. Fin. Code § 22100
Why This Is the Correct Answer
A finance broker license authorizes brokering loans to finance lenders; lending one's own money is the lender activity and needs that authority, the license being activity-specific rather than one unrestricted permission. Other choices: brokering is not the wider authority; there is no 25-loan allowance; and the broker license is not surrendered to add lender authority. Source: Cal. Fin. Code § 22100
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