Podcast
Questions and Answers
What is one way institutional lenders from other states can invest in California loans?
What is one way institutional lenders from other states can invest in California loans?
What licensing requirement applies to a third party originator of mortgage loans?
What licensing requirement applies to a third party originator of mortgage loans?
What licensing status is required for salespersons of third party originators?
What licensing status is required for salespersons of third party originators?
What is the primary function of finders in the context of mortgage loans?
What is the primary function of finders in the context of mortgage loans?
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Which of the following could a third party originator be categorized as?
Which of the following could a third party originator be categorized as?
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In advertising, what must a third party originator indicate?
In advertising, what must a third party originator indicate?
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Which scenario would be considered a bait and switch ad?
Which scenario would be considered a bait and switch ad?
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How should trust fund accounts managed by third party originators be used?
How should trust fund accounts managed by third party originators be used?
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What is true regarding interest bearing broker trust accounts?
What is true regarding interest bearing broker trust accounts?
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Which option is a valid way for institutional lenders in other states to engage in California loans?
Which option is a valid way for institutional lenders in other states to engage in California loans?
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Study Notes
Third Party Originators Overview
- Institutional lenders from other states can invest in California loans by either purchasing loans from mortgage bankers or using third party originators.
- A third party originator of mortgage loans must be licensed by the Department of Real Estate and cannot operate without proper licensing.
Licensing and Regulation
- Salespersons working for third party originators must hold a real estate license, whether as a salesperson or broker.
- Third party originators may act as an agent for borrowers, lenders, or serve in a dual capacity.
Advertising and Compliance
- Any advertising done by a third party originator must clearly state that the advertiser is a licensed real estate professional and include the broker's license number.
- An example of a bait and switch advertisement is one that quotes loan terms not actually available to consumers.
Trust Fund Accounts
- Trust fund accounts used by third party originators must be kept separate from general business accounts and are not allowed to be mixed with personal or business funds.
- Interest bearing trust accounts must split interest either between borrowers and lenders or may allow brokers to keep the interest earned, depending on the specific arrangements in place.
Record Keeping
- Trust fund records for third party originators must document key information such as the names of the individuals depositing funds, the amounts received, and the dates of these transactions, ensuring thorough and accurate financial tracking.
Third Party Originators Overview
- Institutional lenders from other states can invest in California loans by either purchasing loans from mortgage bankers or using third party originators.
- A third party originator of mortgage loans must be licensed by the Department of Real Estate and cannot operate without proper licensing.
Licensing and Regulation
- Salespersons working for third party originators must hold a real estate license, whether as a salesperson or broker.
- Third party originators may act as an agent for borrowers, lenders, or serve in a dual capacity.
Advertising and Compliance
- Any advertising done by a third party originator must clearly state that the advertiser is a licensed real estate professional and include the broker's license number.
- An example of a bait and switch advertisement is one that quotes loan terms not actually available to consumers.
Trust Fund Accounts
- Trust fund accounts used by third party originators must be kept separate from general business accounts and are not allowed to be mixed with personal or business funds.
- Interest bearing trust accounts must split interest either between borrowers and lenders or may allow brokers to keep the interest earned, depending on the specific arrangements in place.
Record Keeping
- Trust fund records for third party originators must document key information such as the names of the individuals depositing funds, the amounts received, and the dates of these transactions, ensuring thorough and accurate financial tracking.
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Description
Test your knowledge with this quiz on Chapter 14, focusing on third party originators in the mortgage lending process. Explore concepts related to institutional lenders, licensing requirements, and the role of third party originators in real estate finance.
