A company holds only a New York mortgage broker registration and has no lending exemption or other lending authority. It proposes to close a conventional residential mortgage in its own name using funds supplied by another lender at closing. Does its broker registration authorize this table-funded transaction?
Correct Answer
A) No; broker registration does not authorize originating a table-funded loan in the broker's own name
The NYDFS Mortgage Broker Guidebook distinguishes arranging funding from making a loan. Brokered loans close in the funding lender's name; a New York broker cannot rely on its registration to extend credit directly or originate a table-funded transaction. Outside funding, borrower consent, or a quick resale does not supply the missing lending authority. The facts expressly exclude a separate exemption or authorization. Source: NYDFS Mortgage Broker Guidebook, Section I — https://www.dfs.ny.gov/apps_and_licensing/mortgage_companies/mortgage_broker_guidebook
Why This Is the Correct Answer
The NYDFS Mortgage Broker Guidebook distinguishes arranging funding from making a loan. Brokered loans close in the funding lender's name; a New York broker cannot rely on its registration to extend credit directly or originate a table-funded transaction. Outside funding, borrower consent, or a quick resale does not supply the missing lending authority. The facts expressly exclude a separate exemption or authorization. Source: NYDFS Mortgage Broker Guidebook, Section I — https://www.dfs.ny.gov/apps_and_licensing/mortgage_companies/mortgage_broker_guidebook
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