A licensed originator in 1 state takes an application from a borrower buying a home in a neighboring state where he holds no license. Assuming no exemption or temporary-authority provision applies, what additional state authority does he need to originate the neighboring-state loan?
Correct Answer
D) He needs a license in the 2nd state as well, where the property sits
D. Obtain the required license for the state where the property is located. The federal minimum addresses origination concerning dwelling or residential real estate in that state. The question excludes exemptions and temporary authority, so a neighboring-state license is not enough. Scope and exceptions: Property location is relevant here, not a claim that it is the only jurisdictional factor in every case. Check other applicable state, employer and location requirements. Source: Section 1008.103(a) — https://www.consumerfinance.gov/rules-policy/regulations/1008/103/
Why This Is the Correct Answer
D. Obtain the required license for the state where the property is located. The federal minimum addresses origination concerning dwelling or residential real estate in that state. The question excludes exemptions and temporary authority, so a neighboring-state license is not enough. Scope and exceptions: Property location is relevant here, not a claim that it is the only jurisdictional factor in every case. Check other applicable state, employer and location requirements.
Why the Other Options Are Wrong
Option A: His 1 existing license is enough, as the SAFE Act creates reciprocity
The existing license is not nationwide authority.
Option B: He may act for 30 days in a new state while an application is pending
The facts establish no thirty-day operating permission.
Option C: He needs no 2nd license if the borrower lives in his own state
Borrower residence does not eliminate the property-state requirement.
Exam Tip
Verify authority for the transaction’s state before originating.
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