May 4, 1984

Mr. William J. Srstka, Jr. 
Attorney at Law 
117 East Capitol 
Post Office Box 66 
Pierre, South Dakota 57501 

Mr. Jack C. Burchill 
South Dakota Real Estate Board 
Post Office 490 
Pierre, South Dakota 57501

OFFICIAL OPINION NO. 84-18

Licensing of Norwest Mortgage, Inc.

Gentlemen:

You have requested an official opinion on behalf of the Real Estate Board for the State of South Dakota.

FACTS: 

Norwest Mortgage, Inc. of Minneapolis, Minnesota has requested an opinion from your board whether or not it is exempt from South Dakota Mortgage Broker's licensing requirement.  Norwest is not in any way licensed in South Dakota and will originate and solicit loans for other entities.

SDCL 36-21-1(3) reads as follows: 

36-21-1.  Terms as used in this chapter unless the context otherwise requires, mean: 

     . . . 

(3)  'Mortgage broker,' any person, firm, partnership, copartnership, limited partnership, association, or corporation other than a licensed real estate broker, bank or trust company, savings and loan association, insurance company, federal land bank, or state or federal agency and their  employees, who for compensation or valuable consideration sell or offer for sale, buy or offer to buy, or negotiate the purchase or sale or exchange of mortgages upon real estate for others, as whole or partial vocation.  The term 'mortgages' as used in this chapter shall exclude any leasehold interests; mortgage brokers do not include persons loaning their own funds; 

     . . .

SDCL 36-21-1.1 reads as follows: 

36-21-1.1.  As used in this chapter unless the context otherwise requires,  'real estate broker' or 'broker' means any person who: 

     . . . 

(2)  For another and for commission, fee or other valuable consideration or with the intention of expectation of receiving the same directly or indirectly negotiates or offers or attempts to negotiate a loan, secured or to be secured by a mortgage or other encumbrance on real estate; 

     . . . 

(11)  Is a mortgage broker, as defined in §  36-21.

It is my opinion that the entity requesting exemption does not fall within the exemptions in SDCL 36-21-1(3).  I therefore advise that you request these entities to be licensed as mortgage brokers.

Respectfully submitted,

Mark V. Meierhenry
Attorney General