Companies applying for a state license or federal registration through NMLS must first obtain an NMLS account by completing a company account request form.
This task may sound easy enough — and NMLS provides a useful guide — but companies often encounter hurdles during the process. We are providing some insights on these hurdles now as thousands of California Financing Law licensees are currently transitioning to NMLS.
Secretary of state documentation
To complete a company account request form, a company must upload its formation documents that are on file with the secretary of state of the state in which the company is incorporated or organized (e.g., articles of incorporation, articles/certificate of organization). Please note, the company’s legal name as reflected in its formation documents must match exactly (including punctuation) with its legal name as entered in the company account request form. This means that DBAs should not be included. Companies that have undergone a legal name change must also upload the document filed with the secretary of state reflecting the change (e.g., amendment to articles of incorporation).
IRS employer identification number
Along with the company account request form, a company must upload the IRS document that identifies the company’s employer identification number (EIN): either an SS-4 letter or a 147C letter. The SS-4 letter is issued to the company by the IRS when the EIN is first established, and the 147C letter serves as a replacement if the company has misplaced its SS-4 letter. A 147C letter can be requested from the IRS by calling 1-800-829-4933 (just be prepared for the IRS to take a long time to complete the request).
The company’s legal name as reflected in its SS-4 or 147C letter must match exactly with its formation documents and company account request form (although, in this instance, NMLS may make an exception for missing or incorrect punctuation marks). Companies that have undergone a legal name change must include evidence that they amended their name with the IRS. This can be accomplished by submitting an amended tax filing or, alternatively, through a manual change process that we understand to be rather slow.
Finally, if a company is a disregarded entity for tax purposes, then it will need to obtain its own EIN to be able to create an NMLS account. This is because NMLS doesn’t accommodate a company that may share an EIN with a parent or affiliate. An EIN can be obtained relatively quickly online via the IRS website.
The company account request form requires the identification of at least one individual (and up to two) to act as account administrators. (We strongly recommend that two individuals be identified to ensure uninterrupted access in the event that one of the individuals leaves the company.) These individuals will have full access to the company’s NMLS record and are the only ones who can set up access and rights for additional organization users.
Among other things, account administrators must be qualified to act on behalf of the company. Additionally, NMLS requires that they be employees of the company. NMLS is known to confirm this by scrutinizing the email address of the account administrator. NMLS is also known to reject company account creation requests where the email address of the account administrator is the same as one on file for another company.
We understand that these protocols are in place to prevent users from setting up accounts on behalf of companies without their knowledge and control. However, this is obviously problematic for those companies that don’t have employees. Such companies are encouraged to upload a letter to NMLS on company letterhead requesting that NMLS permit an officer, director, manager, or authorized signatory of the company to serve as the account administrator.
The company account request form requires identification of a contact employee. This individual must be authorized to answer questions on behalf of the company, speak on the company’s NMLS record, and be prepared to discuss the form with a state or federal regulator, or an NMLS representative. As is the case with account administrators, we caution that NMLS is likely to question the designation of a contact employee who doesn’t have an email address with a clear association to the company submitting the form.
The company account request form requires identification of a submitter. The submitter must attest that they are authorized to submit the form on behalf of the company and confirm, among other things, that the information contained in the form is true and accurate, and that the individuals designated as contact employee and account administrator are duly authorized to act in such capacity to the best of the submitter’s knowledge. Once again, we caution that NMLS is likely to question the designation of a submitter who doesn’t have an email address with a clear association to the company submitting the form.
APPROVED can help
If you require assistance creating an NMLS account — whether for a company or its key individuals or mortgage loan originators — check in with APPROVED.