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Business-purpose licensing,
state by state.
Most states don’t require a license to make or broker business-purpose loans — but a handful do, and prepayment penalties follow their own map entirely. Pick a state below and get the whole answer in one place.
52
Jurisdictions Covered
41
No Lender License Needed
10
License-Required States
5
PPP-Prohibited States
The 60-Second Version
How business-purpose licensing works
01 · The Exemption
Business purpose is different
State mortgage-licensing regimes are built around consumer lending. Loans made to entities for investment and business purposes fall outside those regimes in most states — which is why 41 of 52 jurisdictions require no lender license for business-purpose loans.
02 · The Exceptions
Some states license anyway
10 jurisdictions require a lender license even for business-purpose loans, and essentially the same set applies to brokering. A few are conditional — California is exempt for DSCR loans only, and Arizona splits by property unit count.
03 · The Other Map
Prepayment penalties have their own rules
PPP authority is regulated separately from licensing. Most states permit prepayment penalties without restriction, 10 restrict them or require specific disclosures, and 5 prohibit them outright — which drives how loans are priced and structured in those states.
Read this before relying on it: this page summarizes Arcstone Financial’s Business Purpose Loan Licensing Requirements & PPP Matrix (revised 5-30-2025) for orientation only. It is not legal advice, was not prepared by legal counsel, and statutes, rules, and regulatory guidance change. Confirm the current position with your account executive — and with your own counsel — before originating in any state.