Mortgage Licensing

• The California Finance Lenders Law (CFL Law) and California Residential Mortgage Lending Act (CRML Act) both state that the Department of Corporations (DOC), specifically the Commissioner of Corporations, is in charge of reviewing the applications for and issuing the licenses for mortgage professionals such as finance lenders, brokers, mortgage lenders and mortgage servicers. In addition to passing a federal mortgage exam, the state of California also requires that those applying for a mortgage license must pass a state mortgage broker exam, which covers the state specific-laws.
  
  

Mortgage Bankers

• The California Residential Mortgage Lending Act (CRMLA) passed as California law in 1996 and is specific to mortgage bankers and mortgage banking activities. CRMLA is different from the Real Estate Law and the California Finance Lenders Law because CRMLA regulates mortgage banking activities, such as authorizing licensees to make federal mortgage loans, home construction loans, sell loans to institutional investors and act as the servicing company on mortgage loans. Mortgage bankers that are licensed under this law are allowed to buy and sell federal mortgages, provide contract underwriting services for institutional lenders and to service federal mortgages.
  
  

Net Worth and Insurance

• The California Finance Lenders Law, which went into effect in 1995, requires mortgage professionals to adhere to specific income and insurance requirements. Licensed mortgage professionals are required to maintain a minimum net worth of $25,000 and maintain a surety bond of at least $25,000.
  
  

Civil Rights

• The Unruh Civil Rights Act is a California state law that works in conjunction with the Americans with Disabilities Act of 1990. This law protects California residents from discrimination against applying for and qualifying for a mortgage because of their sex, race, color, religion, ancestry, national origin, disability, medical condition, marital status or sexual orientation.
  
  

Community Property

• California is a community property state. This means that individuals cannot apply for a mortgage on a property without notification to and consent from their spouse. California law also states that if a borrower is using a spouse's income, alimony or child support as part of his income for qualifying purposes, then the spouse (or former spouse) may be required to provide information to the lender.