It's advisable for buyers of Pleasanton homes for sale to know everything they can that is related to real estate, including the laws that govern buyers, sellers, and even mortgage lenders. It's essential to know these things to prevent any issues from happening during the home buying process.

Aside from the California Finance Lenders Law and the Real Estate Law, a law was enacted as an option to these laws that license lenders: the California Residential Mortgage Lending Act (CRMLA).

The CRMLA was passed in 1994 and started operating in 1996. It was enacted to give a licensing law to mortgage bankers that is purposely created to control their main tasks of originating and servicing mortgage loans. It is specially intended to regulate and authorize activities concerning mortgage banking, unlike the California Finance Lenders Law and the Real Estate Law.

Applicants of this act may acquire a license as a servicer, a lender, or even both. If approved, these licensees are authorized by the CRMLA to do the following:

• Make mortgage loans that are federally related

• Make loans to fund home construction

• Sell loans to investors

• Service loans

• Buy and sell loans that are federally related

• Give institutional lenders contract underwriting services

• Service any mortgage loans that are federally related not considering whether the loan is made or a servicing portfolio is purchased

• Give brokerage services to borrowers by means of trying to acquire a loan from another lender on their behalf

As required by the CRMLA, any individual who is in the business of servicing or making residential loans within Pleasanton and California must be licensed under the Act; however, there are some entities that are exempted from these licensing requirements. These include the following:

• Federal credit unions, federal savings bank, federally chartered loan and savings associations;

• Industrial loan companies, insurance companies, trust companies, banks;

• Individuals engaged exclusively in agricultural, commercial, or business mortgage lending;

• Credit unions, savings banks, and savings and loan associations that are authorized to do business in California;

• Municipal, state, and federal governments;

• Completely owned service corporations of savings banks or savings and loan associations;

• Individuals who act in a fiduciary capacity granted by a court's authority;

• Pension plans that make residential loans to their members;

• Finance lenders in California;

• Licensed brokers in California; and

• Trustees in foreclosure procedures.

Licensed mortgage bankers under the CRMLA may be any one of the following:

• A person

• A sole proprietorship

• A corporation

• A partnership

• A limited liability company

• An association

• A trust

• A joint venture

• An unincorporated organization

• A joint stock company

• A government

• A government's political subdivision; or

• Any other entity

Here are the requirements for applicants to acquire a license:

• Approval as a lender and/or a servicer from any of the following: the Federal Home Loan Mortgage Corporation, Federal National Mortgage Association, Government National Mortgage Association, Farmers Home Administration, Veterans Administration, or Federal Housing Administration

• Audited financial reports that show actual net worth of a minimum of $250,000

• $50,000 surety bond

Such information can be useful even for buyers of Pleasanton real estate. You should ask your agent for any questions you have related to the home buying process.