Effective January 1, 2017, the definition of lender under the California Residential Mortgage Lending Act (RMLA) will be amended to include third-party processors and/or underwriters who do not solicit loan applicants, originate mortgage loans, or fund mortgage loans. Under the current definition, the term lender is limited to an entity that is an approved lender for Federal Housing Administration (FHA), VA, Farmer Mac, GNMA, Fannie Mae, or Freddie Mac, thereby precluding entities that do not have such an approval from obtaining a license under the Act. Holding a license under the Act provides certain advantages over being licensed under either the California Finance Lenders Law or the Real Estate Law.

The Act also was amended to permit the Commissioner to require a licensee who is engaged in the processing or underwriting of residential mortgage loans to continuously maintain a minimum tangible net worth in an amount that is greater than $250,000, but that does not exceed the net worth required of an approved lender under the FHA.