DOBI Article Levy & Watkinson Attorneys Edison New Jersey

MORTGAGE BANKER AND BROKER OFFICE REQUIREMENTS SET FORTH IN BULLETIN ISSUED BY DEPARTMENT OF BANKING AND INSURANCE

(DOBI)

DOBI has issued a Bulletin clarifying its position as to when it will approve a location for a main or branch office of a licensee that would meet the “suitable location” criteria contained in the Licensed Lenders Act. In so doing, the Department has modified its position regarding “executive suites” which now can be approved if the standards outlined in the Bulletin are met. This is an issue that has been discussed at our Licensed Lenders Advisory Board meetings with guidelines that licensees can now apply before submitting proposed office locations for branch or main office license approval.

The Department has recognized that “executive suites” can be legitimate office locations where offices are private and offer sufficient confidentiality to consumers seeking mortgage loans, notwithstanding that they are part of a larger suite of unrelated offices. In this regard, in addition to the clarifying Bulletin, DOBI will be amending its rules to allow such offices to meet the “suitable location” requirement. Until then, the Department suggests that preliminary review be requested from the Department before entering into any lease agreements by submitting the floor plan, the proposed lease and interior and exterior photos showing where signs would be placed. We would also suggest providing specific information indicating the manner in which the office location would meet the criteria set forth in the Bulletin.

Pursuant to the criteria in the Bulletin, an office location of any kind would have to have a space utilized solely by the licensee and enclosed by “four floor-to-ceiling walls” and a door where private conversations can be held with consumers. Desk rentals, therefore, will not meet the “suitable location” requirement. Furthermore, the private office space cannot be shared with any other entity or individual even if a wholly-owned subsidiary or an affiliate. An area must also be available where the files and records of the licensee can be maintained in a confidential manner.

The office must have adequate signage clearly identifying the licensee and its private work area which may be on an exterior sign or an interior lobby board listing all building occupants, if one is in use, as well as on a wall or door of the licensed office.

The office must be staffed by at least one employee of the licensee. Workers shared with others, such as receptionists, do not satisfy this requirement but may be utilized by the licensee.

The office must be “reasonably accessible” to the public such as access through an exterior entrance directly into the licensee’s office or through a common hallway or lobby area used to access others offices leading to the licensee’s office door but not if consumers have to pass through an office or hallway of another business.

The bulletin is available on www.njdobi.org.

385 Morris Ave., Springfield, NJ 07081
Phone: (973) 379-7447
Fax: (973) 379-5152

E. Robert Levy
Wayne A. Watkinson
Janet G. Sofield
Richard B. Gelfond
John D. Blomquist