Can You Lend OPM In Florida Without a License?

8 Replies

Yes..and no. 
Per Statute 494 which governs mortgage lending, an exception is granted to those who lend THEIR OWN money. 
So--can you lend OPM and stay within the law?
My interpretation is YES--provided you lend the money, which you borrowed, secured by RE or even a promissory note.
Imagine borrowing money at 6% and lending at 18%. Can that be done? Absolutely. Even if you borrow the money from friends or family, and give them a promissory note, it is YOUR money to do with as you please. However, if you lend THEIR money, and ask for points or other fees and YOU are not the lender on the mortgage and note, you are mortgage brokering and a license is required. I see LOTS of investors lending money using their 401K or IRA to make great returns. Got an IRA or 401K that you want to diversify? Consider being a lender, or purchasing 1st lien mortgage notes for steady income. Due diligence required in either case. Write bad loans--get bad results.

THIS IS NOT LEGAL ADVICE--MY OPINION ONLY
CONSULT YOUR ATTORNEY

I want to add that individuals without a license should avoid calling themselves lenders. Better be named as mortgage investors to avoid issues with misrepresentation and licensing.

also lending on primary residence can lead to lots of troubles with Federal laws especially if there is a balloon due in less then 5 years.

There is a major distinction  between  business loans and  Consumer loans. Yes Dodd-Frank must be considered.

@John Thedford FL is a mortgage state, do you know how long a typical foreclosure takes for a business loan?

Originally posted by @David C. :

@John Thedford FL is a mortgage state, do you know how long a typical foreclosure takes for a business loan?

I am sorry I do not and am fortunate I have not had to foreclose yet. 

@David C.

We actually do have to do commercial property foreclosures here in Florida periodically. It depends on the attorney you hire, the jurisdiction you file in, and how hard the other party fights. I'm not trying to avoid the question of how long a Florida foreclosure takes on a business property, but those are all factors. It can take a few months to a couple of years depending upon those factors. The right attorney makes all the difference. If you need a good one, let me know. I can refer you to a couple. 

Very interesting @John Thedford I wouldn't have thought that was the case. Thanks for the info!

Originally posted by @Odie Ayaga :

Very interesting @John Thedford I wouldn't have thought that was the case. Thanks for the info!

 Get legal advice. I realize FL has carved out an exception for lending one's one money for their benefit. The statute also states that one should not be holding one's self out as a lending BUSINESS. I have talked to the state a few times, and have been led to believe that stating they are PRIVATE funds is ok. However, the reality exists that they could state this was not the case. My ads state PRIVATE funds. 

Yes in a given situation I would certainly do so I just didn't think you could do that anywhere. Knowing it's a possibility is nice, even only in certain states or situations

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