In March 2014, I wrote about my third language to freedom, the language of real estate. This month’s post is a sequel of sorts. My fourth language to freedom is the language of money, rules, and regulations.
In August 2014, I became a certified Private-Money Broker. Since then, I received additional training to become Senior, then Master Private-Money Broker. During the Master Private-Money Broker training in early November 2014, the idea was planted in my head about becoming licensed as a Mortgage Loan Originator (MLO) through the Nationwide Mortgage Licensing System & Registry (NMLS).
NMLS was established under the authority of the Secure and Fair Enforcement for Mortgage Licensing Act of 2008, which is commonly known as the SAFE Act. The SAFE Act is Title V of the Housing and Economic Recovery Act of 2008. It is governed by the then newly-created Consumer Financial Protection Board.
The SAFE Act applies to the “residential” mortgage industry for the purpose of “protecting consumers.” And I am absolutely not interested in originating mortgage loans for consumers who buy owner-occupied residential properties. The reason has been duly noted in my July 2013 blog post called, “The laws that killed our business model.”
Immediately upon returning home from the Master Private-Money Broker training in November, I began figuring out what I needed to do to be licensed as an MLO in the state of Michigan where I reside. I signed up for a three-day class; crammed for two days; scheduled, took, and passed the test.
By being a Private-Money Broker, the ultimate goal toward which I’m headed is to be my own Private-Money Lender. The loans we provide are private loans to business entities for business or commercial purposes and secured by a non-owner occupied residential property (i.e., investment property that will NOT be occupied by the borrower or principals of the borrower).
So, if I am not dealing with owner-occupied residential borrowers, then why go for the MLO license, you may ask. Here is my answer. Some of the states require of even the Private-Money Brokers – whose sole focus is to provide loans to non-consumers, just like our company – to be licensed. Currently, the state of Michigan does not have this requirement. But you never know when lawmakers may decide to make it a requirement. If and when this happens, I will be prepared, armed with a license issued by the NMLS. So long as I stay current with an annual eight-hour continuing-education requirement, I’m all set. There you have it.
By the way, with every new language that I have chosen to learn and incorporate into my life since childhood, there is a distinct pattern as to why I did what I did.
- First language: Japanese is my first language. It was my primary language until I left the country at age 23.
- Second language: When I chose to become fully bilingual, adding English to my native language, I never wanted to be a translator for someone else’s benefit at their whim. Why? It’s easy for those who don’t understand another language – and therefore, have no clue what it takes to be an excellent translator – to criticize someone for one little innocent, incorrect translation. (I have seen it done to a well-known, otherwise excellent translator in Japan on live TV decades ago. People can be so cruel and inconsiderate of others’ imperfections – as if they themselves were always perfect. They think nothing of destroying someone else’s career. Right at that moment, I knew I would never put myself in a situation where others could destroy my career.)
- As a side note, when I translated competitive materials while at Chrysler, they were all what I chose to translate on my own initiative for the benefit of the company; no one else made me do it. In fact, they had little to do with my day-time job at the company.
- I made an exception when the assignment came directly from Mr. Lee Iacocca, then Chairman of the Board. The request was made so gently that I was more than happy to oblige.
- Third language: When I became licensed as a REALTOR in 2005, I never wanted to be an agent for someone else. I obtained the license purely to buy and/or sell our own investment properties.
- If I choose to become a real-estate broker, and if the quickest way to become one is to act as an agent for others for a certain period of time, I may bite the bullet and do so.
- I’m beginning to think that it may make good sense to have a license as a real-estate broker, especially as I begin to put greater emphasis on originating commercial loans, not just non-owner-occupied residential properties.
- Fourth language: I just passed the exam to be licensed as an MLO. Again, because of the recent laws, I have no desire to originate consumer loans; too much risk and insufficient rewards. I am getting the license, first and foremost, to become a better investor myself. Getting paid while serving the needs of other like-minded investors is an icing on the cake.
As you can see, I chose to obtain and use the knowledge, skills, and/or the license as a means to achieve and maintain my freedom and independence – every single step of the way. By the same token, I always knew that, if I were to ever face a situation where I could not put food on the table any other way, I could always rely on one or more of these “language skills” by working for someone else. While I hope that such a scenario never materializes, it is comforting to know that there is always a place to fall back on if need be.
I simply cherish being the boss of my own destiny. That, to me, is the essence of being free and independent in the United States of America.
Happy investing!
