How to Start a Finance Company

by Contributor; Updated September 26, 2017
Start a Finance Company

How to Start a Finance Company. When you look at finance companies, banks easily come to mind. Banks, large or small, have always been the institutions looked to in order to finance such things as homes or a new business. However, it is possible for private citizens to go into business to provide many of the same services that banks have provided for years.

Items you will need

  • Business license
  • Office space
  • Computer
  • Fax machine

Mortgage Broker and Loan Originator Requirements

Step 1

Pay a $1,500 non-refundable investigation fee. The investigation is needed to find out if the applicant has been involved in any fraudulent activity in the past.

Step 2

Write a check to the state for $1,200 for your license fee. This fee is non-refundable.

Step 3

Produce a Surety Bond to the state in the amount of at least $20,000. This contract is your promise to the state to be legal in your practices. The cash amount is your compensation in the event of any damages.

Step 4

Submit your financial statements to the state. Your net worth must be at least $35,000.

Step 5

Pay your loan originator application fee to the state in the amount of $125.

Step 6

Fill your continuing education requirement of at least six hours. The continuing education courses are on residential mortgage finance.

Step 7

Take courses at a local college or university to get a better understanding of finance before you enter into business.

Life Insurance Broker Requirements

Step 1

Fill out your Life Insurance Broker application and submit to the state.

Step 2

Fulfill your required 40 hours of pre-licensing education at an institution approved by the state.

Step 3

Take and pass the state exam. Your license is good for two years. At the end of your term, you must retake the test again.

Build Your Office

Step 1

Get your business license from your city or state before acquiring any space for your office.

Step 2

Find a storefront or office space to make your offices.

Step 3

Buy computers, fax machines and other electronic equipment to help organize your business.

Step 4

Hire staff for your office based on need.

Tips

  • These requirements are based on Illinois law. Mortgage broker and Loan Originator licensing varies by state. These requirements are based on New York law. Insurance broker licensing requirements vary by state.