General Information

The Indiana Secretary of State, Securities Division (“Division”) oversees the licensure, examination, general operation, and compliance of loan brokers, and the individuals that represent loan brokers, in Indiana under the Indiana Code, and supporting federal regulations.

Loan Brokers and Branch Offices

Under Indiana law, a loan broker is “a person who, in return for any consideration from any source procures, attempts to procure, or assists in procuring a residential mortgage loan from a third party, regardless of whether or not the person seeking the loan obtains the loan.” Ind. Code § 23-2.5-1-14. If a person meets the loan broker definition, licensure would be required unless the person is otherwise excluded from the loan broker definition.

Many loan brokers operate multiple locations in the Indiana. Each loan broker office operated by a loan broker must be licensed with the Division. Any location in which a loan broker conducts business may be considered a loan broker office and a loan broker should review the definition at Ind. Code § 23-2.5-1-17 to ensure compliance with the Indiana Code. Any loan broker office that is not the loan broker’s principal place of business would be considered a branch office. The loan broker should consult with legal counsel or a compliance consultant to ensure any location that qualifies as a loan broker office is properly licensed with the Division.

All filings and fees for loan broker and branch office licenses are made through the Nationwide Multistate Licensing System (“NMLS”). The NMLS checklists for loan brokers and branch offices provide an overview of the filing requirements. All required forms and items must be completed before submitting an application for licensure. Failure to complete the forms and items will delay the processing of the application. The company will be notified of any deficiencies on its license through NMLS. Any deficiencies must be cured prior to approval of the company’s licensure.

Principal Managers, Branch Managers and Mortgage Loan Originators

Under Indiana law, a principal manager is “an individual who has at least three (3) years of experience as a mortgage loan originator and is principally responsible for the supervision and management of the employees and business affairs of not more than five (5) loan broker offices.” Ind. Code § 23-2.5-1-27. The principal manager license incorporates the ability to engage in mortgage loan origination activities. Each loan broker office must designate a principal manager in order to be licensed with the Division.

If the loan broker office is not the principal place of business of the loan broker, but qualifies as a branch office, the loan broker must also designate a branch manager in addition to the designated principal manager. A branch manager is an individual with a mortgage loan originator or principal manager license that is designated as the branch manager on the branch office application and who supervises and oversees the activities conducted at the branch office.

Under Indiana law, a mortgage loan originator is “an individual engaged in mortgage loan origination activities.” Ind. Code § 23-2.5-1-22. Mortgage loan origination activities are “the performance of any of the following activities for compensation or gain in connection with a residential mortgage loan: (1) Receiving or recording a borrower’s or potential borrower’s resident mortgage loan application information in any form for use in a credit decision by a creditor. (2) Offering to negotiate or negotiating terms of a residential mortgage loan.” Ind. Code § 23-2.5-1-21. If a person meets the definition of a mortgage loan originator, licensure would be required unless otherwise excluded from the mortgage loan originator definition.

All filings and fees for individual licenses are made through NMLS. The NMLS checklists for principal manager and mortgage loan originator licenses provide an overview of the filing requirements. All required forms and items must be completed before submitting an application for licensure. Failure to complete the forms and items will delay the processing of the application. The Individual will be notified of any deficiencies on the license through NMLS. Any deficiencies must be cured prior to approval of the individual’s licensure.

Requirements
Initial Application for Loan Broker Licenses
  • The company must apply through NMLS by submitting the Company (MU1) Form.
  • The non-refundable initial filing fee is two hundred dollars ($200) and is paid through NMLS.
  • Submit an electronic surety bond through NMLS in the amount of sixty thousand dollars ($60,000) by a surety company authorized to conduct business in Indiana.
  • Credit reports for individuals in a position of control that are licensed as mortgage loan originators or principal managers.
  • Each Ultimate Equitable Owner (“UEO”), as defined in Ind. Code § 23-2.5-1-38, must be listed on NMLS. There is a one hundred dollar ($100) fee, invoiced through NMLS, for each UEO.
  • Every individual that is an UEO, director, manager, or officer must submit an FBI Criminal Background Check along with fingerprints.
  • The loan broker must list the Indiana Secretary of State as the registered agent for service of process.
  • Every loan broker must submit an appropriate principal manager that meets Indiana's requirements.
  • Approved licenses expire on December 31. In order to continue operating its business, a loan broker must submit a renewal registration and pay any associated fees.
  • Additional details on requirements may be found on the NMLS New Application Checklist.
Initial Application for Branch Office Licenses
  • A branch office must apply through NMLS by submitting the Branch (MU3) Form Filing.
  • The non-refundable initial filing fee is seventy-five dollars ($75) and is paid through NMLS.
  • Any loan broker office that is not designated as the principal place of business, but meets the definition of a loan broker office, must apply for a branch office license.
  • A principal manager must be designated for each branch office.
    • A principal manager may serve as the principal manager for up to five (5) loan broker offices.
  • A unique branch manager must be designated for each branch office.
    • The branch manager is an individual with either a principal manager or mortgage loan originator license that is specifically designated to supervise and oversee the mortgage loan origination activities conducted at the branch office.
  • Approved licenses expire on December 31. In order to continue operating its business, a branch office must submit a renewal registration and pay any associated fees.
  • Additional details and requirements may be found on the NMLS New Application Checklist.
Renewal Application for Loan Broker and Branch Office Licenses
  • Requirements for renewal applications for both the Loan Broker and Branch Office Licenses are identical to requirements for the initial Loan Broker and Branch Office Licenses.
  • Renewals must be timely submitted thirty (30) days prior to the expiration of the license.
  • Indiana does not recognize the NMLS reinstatement period.
  • If a company fails to renew its license prior to expiration, including failing to pay the renewal fee or UEO fees, the company cannot lawfully conduct business beginning on January 1.
Loan Broker and Branch Office Operations
  • Loan brokers and branch offices are required to meet certain continuing obligations and requirements in order to operate in Indiana. The obligations and requirements are in addition to any federal guidelines that may affect the operation of the business. Some examples of continuing obligations of the company relate to records maintenance, adherence and review of the company’s policies and procedures, retention of complete and accurate loan origination files, accurate disclosures provided to customers, among many other topics. The requirements and obligations related to loan brokers and branch offices are detailed in the Indiana Code and the Indiana Administrative Code. If there are questions regarding whether a loan broker’s activities comply with the outlined obligations, consult legal counsel or a compliance consultant
  • Under Indiana law, the Division has the authority to examine loan brokers for compliance with the Indiana Code and Indiana Administrative Code
Initial Application for Principal Manager Licenses
  • The individual must apply through NMLS by submitting the Individual (MU4) Form Filing.
  • The non-refundable initial filing fee is one hundred dollars ($100) and is paid through NMLS.
  • In order to qualify for a principal manager license, an individual must:
    • Meet the examination and education requirements outlined at Ind. Code § 23-2.5-6;
    • Complete an additional sixteen (16) hours of education, four (4) hours of which must be on the topic of ethics; and
    • Have been licensed as a mortgage loan originator or state licensed mortgage loan originator through NMLS for at least three (3) of the five (5) years immediately preceding the application.
  • The individual must submit an FBI Criminal Background Check along with a current set of fingerprints.
  • The individual must provide authorization for a credit report check on NMLS.
  • The individual must provide explanations for any disclosures listed on the MU4.
  • The individual must have company sponsorship through NMLS.
  • The individual’s business address listed on the MU4 must match the address of the registered location of the company.
  • Approved licenses expire on December 31. In order to continue operating as a principal manager, the individual must submit a renewal registration and pay any associated fees.
  • Additional details and requirements may be found on the NMLS New Application Checklist.
Initial Application for Mortgage Loan Originator Licenses
  • The individual must apply through NMLS by submitting the Individual (MU4) Form Filing.
  • The non-refundable initial filing fee is fifty dollars ($50) and is paid through NMLS.
  • In order to qualify for a mortgage loan originator license, an individual must meet the education requirements outlined at Ind. Code § 23-2.5-6
    • If a license has lapsed or expired for a period of at least five (5) years, the individual must complete all the initial education and examination requirements.
  • The individual must submit an FBI Criminal Background Check along with current fingerprints.
  • The individual must provide authorization for a credit report check on NMLS.
  • The individual must provide explanations for any disclosures listed on the MU4.
  • The individual must have company sponsorship through NMLS.
  • The individual’s business address listed on the MU4 must match the address of the registered location of the company.
  • Approved licenses expire on December 31. In order to continue operating as a mortgage loan originator, the individual must submit a renewal registration and pay any associated fees.
  • Additional details and requirements may be found on the NMLS New Application Checklist.
Renewal Application for Principal Manager and Mortgage Loan Originator Licenses
  • Requirements for renewal applications for both the Principal Manager and Mortgage Loan Originator licenses are identical to requirements for the initial Principal Manager and Mortgage Loan Originator licenses.
  • The individual must meet the continuing education requirements outlined at Ind. Code § 23-2.5-6. This includes eight (8) hours of NMLS approved education.
  • Renewals must be timely submitted thirty (30) days prior to the expiration of the license.
  • Indiana does not recognize the NMLS reinstatement period.
  • If an individual fails to renew their license prior to the expiration of their license, including paying renewal fees, the individual cannot lawfully conduct business beginning on January 1. A complete application for licensure will be required and business cannot be lawfully conducted until the individual is properly licensed.
Relevant Law

Indiana Code [23-2.5]
Indiana Administrative Code [710 IAC 1-22]
Statement of Policy Regarding Mortgage Brokers and Subprime Lending [August 17, 2007]

Helpful Resources

Branch (MU3) Form
Company (MU1) Form
Documents and Records Request
Indiana Loan Broker Agreement
Individual (MU4) Form
Loan Broker Exam Questionnaire
Loan Broker Examination Process and Procedures
Nationwide Multistate Licensing System (NMLS)
NMLS Approved Education
NMLS Electronic Surety Bond
NMLS Quick Guides - Company
NMLS Quick Guides - Individual
Secure and Fair Enforcement for Mortgage Licensing Act (SAFE Act)
State Licensing Requirements – Indiana SOS Checklists

Division Personnel
Licensing

Ariel Smock
Compliance Officer Team Lead
arsmock@sos.in.gov
317-232-6684

Examinations

Jim Easton
Loan Broker Examiner
jeaston1@sos.in.gov
317-234-9673