Broker – Loans

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For purposes of Civil Code Sec. 1916.1–which states that “a loan…is arranged by a person licensed as a real estate broker [and thus exempt from the state constitutional ban on usury] when the broker…acts for compensation or in expectation of compensation for soliciting, negotiating, or arranging the loan for another”–a real estate broker can be deemed to have arranged a loan “for another” when the lender is a corporation that is wholly owned by the broker. Broker may be found to have arranged a loan “in expectation of compensation” under Sec. 1916.1 even if the only compensation the broker will receive is the profit his wholly owned corporation reaps from the interest on the loan. Bock v. California Capital Loans, Inc. – filed May 14, 2013, Third District Cite as C069863