accessIndiana

Applying for License as a Loan Broker

• Any person who, in return for any consideration from any source procures, attempts to procure, or assists in procuring a loan from a third party or any other person, whether or not the person seeking the loan actually obtains the loan, is required to become licensed under the Indiana Loan Broker Act (Ind. Code 23-2-5), unless the person is not considered a loan broker under Ind. Code 23-2-5-3(e) or qualifies for an exemption under Ind. Code 23-2-5-19.
  
• A person applying for a loan broker license must:
  • Submit a properly completed Application for License as a Loan Broker (State Form 38168/Form LB1)
  • Pay a non-refundable application fee of $400.00, and an additional $200.00 for each of the loan broker's ultimate equitable owners plus $32.25 for each FBI criminal background check;
  • Obtain a $50,000 surety bond in effect for the full length of the licensing period with the
    obligee as State of Indiana;
  • Submit a properly completed Ultimate Equitable Owner Information Form (State Form53271/Form LB 2) for each of the loan broker's ultimate equitable owners;
  • Obtain an FBI fingerprint card (FD258) for each Ultimate Equitable Owner, director, manager or officer; (see section "Federal Criminal Background Report: Explanation and Instructions" for more information);
  • Submit a properly completed Branch Office Notification (State Form 53264/Form LB 3) for each of the loan broker's branch office(s) located or engaging in origination activities in Indiana; and
  • Have a properly registered principal manager for each office location, including the principal office location (See the section "Applying for Registration as a Principal Manager or an Originator" for registration requirements).
• Loan Broker Licensees must renew their license biennially. The license expires on December 31 of the second year after issuance. The renewal application must be submitted no later than December 1st of the year of expiration. Failure to submit the renewal on time will require the loan broker to apply for an initial license and complete all initial requirements.

  Applying for Registration as a Principal Manager or an Originator

• Any individual that engages in origination activities or serves as a Principal Manager on behalf of a licensed loan broker must register with the Indiana Secretary of State, Securities Division under the Indiana Loan Broker Act (Ind. Code 23-2-5) by submitting a properly completed Application for Registration as a Principal Manager or an Originator (State Form 49718/Form LB 4).
• Applicants for registration as a Principal Manager must:
  • Submit a properly completed Application for Registration as a Principal Manager or an
    Originator (State Form 49718/Form LB 4);
  • Pay a non-refundable application fee of $200.00, plus $32.25 for an FBI criminal background check;
  • Complete 24-hours live of approved academic instruction (see section "Approved Educational Courses for Principal Managers & Originators" for a list of approved courses);
  • Successfully pass the required principal manager registration examination (see section "Principal Manager/Originator Registration Examination" for more information);
  • Obtain an FBI fingerprint card (FD258), (see section "Federal Criminal Background Report: Explanation and Instructions" for more information);
  • Show proof that the individual has satisfied the minimum three (3) year experience requirement under Ind. Code § 23-2-5-5(c)(8); and
  • Show proof of employment before the individual may engage in origination activities or serve as a principal manager.
• Applicants for registration as an Originator must:
  • Submit a properly completed Application for Registration as a Principal Manager or an Originator (State Form 49718/Form LB 4);
  • Pay a non-refundable application fee of $100.00;
  • Complete 24-hours live of approved academic instruction (see section "Approved Educational Courses for Principal Managers & Originators" for a list of approved courses);
  • Successfully pass the required originator registration examination (see section "Principal Manager/Originator Registration Examination" for more information);
  • Obtain an FBI fingerprint card (FD258), (see section "Criminal Background Report: Explanation and Instructions" for more information); and
  • Show proof of employment before the individual may engage in origination activities.
• Principal Managers and Originators are required to complete six (6) hours of continuing education during each calendar year after the year in which their registration was issued to maintain their certificate of registration.
• Principal Managers and Originators must renew their registration biennially. The registration expires on December 31 of the second year after issuance. The renewal applications must be submitted no later than December 1st of the year of expiration. Failure to submit the renewal on time will require the individual to apply for an initial registration and complete all initial requirements.

Who is Exempt?

• Effective July 1, 2008, The following individuals and entities are exempt under Ind. Code § 23-2- 5-19 and have the option of informing the Division in writing that they are exempt. The burden of proof of any exemption provided is on the party claiming the exemption. Ind. Code § 23-2-5-19(d).
  • Any attorney while engaging in the practice of law;
  • Any certified public accountant, public accountant, or accountant practitioner holding a certificate or registered under IC 25-2.1 while performing the practice of accountancy (as defined by IC 25-2.1-1-10);
  • Any broker-dealer, agent, or investment advisor registered under IC 23-19;
  • Any person that procures, promises to procure or assist in procuring a loan that is not subject to the Truth in Lending Act (15 U.S.C. 1601 through 1667e);
  • Any community development corporation (as defined in IC 4-4-28-2) acting as a sub recipient of funds from the Indiana Housing and Community Development Authority established by IC 5-20-1-3;

HEA 1359 requires that the Securities Division and Department of Financial Institutions issue guidelines by September 1, 2008 informing lenders and loan brokers of the appropriate agency by which they will be regulated.

•  Federal Criminal Background Report: Explanation and Instructions

•  Approved Educational Courses for Principal Managers & Originators

•  Candidate Guide for the Principal Manager/Loan Originator Registration Examinations

• Resources for the Principal Manager and Loan Originator Registration Assessments

•  Company Console User Guide: This Guide is for company representatives that would be purchasing exams for candidates

Forms

•  Application for License as a Loan Broker – State Form 38168/Form LB 1
•  Ultimate Equitable Owner Information – State Form 53271/Form LB 2
•  Branch Office Notification Form – State Form 53264/Form LB 3
•  Application for Registration as a Principal Manager or an Originator – State Form 49718/Form LB 4
•  Calculation of Loan Broker Application Fee - State Form 53304
•  Loan Broker Bond - State Form 53305
•  Application for Approval of Academic Instruction Course - State Form 53272
•  Request for Limited Adult Criminal History Information - State Form #8053

Statutes, Rules, & Notifications

•  Summary of House Bill 1359
•  Indiana Loan Broker Act (Ind. Code 23-2-5)
•  Indiana Loan Broker Administrative Rules ( Ind. Admin Code 710 IAC 1-22-4)
•  House Bill 1717 – Revised Loan Broker Act
•  Summary of House Bill 1717
•  June 7, 2007 Letter to Licensed Loan Broker Re: HB 1717
•  June 7, 2007 Letter to Education Vendors Re: HB 1717
• Loan Broker Education Course Fee Schedule (07-0054 AO)

Additional Information:

• Loan Broker Frequently Asked Questions
• Search Secretary of State, Securities Division Database for Licensed Loan Brokers
• Search for HUD-approved Loan Brokers

Attention Lending Institutions: Lending Institutions are regulated by the Indiana Department of Financial Institutions. Any questions regarding the licensing of lending institutions should be directed to the Department of Financial Institutions. You may contact the Department of Financial Institutions at 317.232. 3955. The Indiana Secretary of State, Securities Division only regulates loan brokers.

Revised 7/18/08