A California Financing Law broker employs 4 mortgage loan originators and arranges residential mortgage loans without funding any of them. What minimum net worth must this arranging-only broker maintain?
Correct Answer
A) Hold net worth of at least $50,000, the figure for arranging brokers
A broker employing mortgage loan originators that arranges but does not make residential mortgage loans keeps a minimum net worth of $50,000. Other choices: $25,000 is the floor for a licensee generally; $250,000 applies to a lender or broker that makes the loans; and the requirement does not depend on who carries the credit risk. Source: Cal. Fin. Code § 22104(b)
Why This Is the Correct Answer
A broker employing mortgage loan originators that arranges but does not make residential mortgage loans keeps a minimum net worth of $50,000. Other choices: $25,000 is the floor for a licensee generally; $250,000 applies to a lender or broker that makes the loans; and the requirement does not depend on who carries the credit risk. Source: Cal. Fin. Code § 22104(b)
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