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States with Reasonable Distance Between MLO Residence and Licensed Branch
States with Reasonable Distance Between MLO Residence and Licensed Branch: What states have distance requirements for NMLS-licensed MLOs to live within a reasonable driving distance from their personal residence to a licensed NMLS mortgage branch?
https://gustancho.com/mlo-remote-work-and-branch-licensing-requirements/
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MLO Remote Work and Branch Licensing Requirements by State
Learn the key State NMLS MLO remote work and branch licensing requirements for mortgage companies operating across multiple states. Understand how MLO licensing, company sponsorship, remote-work approval, and licensed branch locations may differ by state.
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Passed Legislation for States With Reasonable-Distance Requirements Between an MLO’s Residence and Licensed Mortgage Branch
Effective August 11, 2026, several states will maintain specific commuting distance or “reasonable distance” standards between an MLO’s NMLS-licensed residence and the supervising licensed branch or office. Many states have revised these requirements due to the enactment of permanent remote-work laws.
There is no nationwide distance rule under the NMLS framework. Each state sets its own requirements through statutes, regulations, or policies. NMLS recommends consulting state-specific licensing checklists, as work-location standards vary. Companies must now indicate whether MLOs are office-based, hybrid, or fully remote.
States Requiring Special Attention
Wisconsin — 100 miles.
- This is arguably the clearest distance rule in the country.
- Wisconsin requires an MLO to be assigned to a licensed or registered office or branch that is either the MLO’s residence or that is located within 100 miles of the MLO’s residence.
- There is no distance exception for remote work.
- If the assigned company location is more than 100 miles away,
- Wisconsin DFI says the MLO must have the residence licensed as a branch.
- Wisconsin also says an MLO’s residence may be licensed as a branch.
New Hampshire — 100 Miles
New Hampshire still requires that a home/identified work location be within 100 miles of the licensed supervisory office. The New Hampshire Banking Department’s current FAQ states that an MLO may work from home, subject to applicable requirements, including the 100-mile supervisory office requirement.
South Carolina — 75 Miles
- South Carolina is important because its statute references a residential branch.
- The Department is permitted to license an MLO’s personal residence as a branch office when it is over 75 miles from a commercial branch office.
- A separate branch licensing fee is also mandated by statute.
Rhode Island – “Reasonable Distance”
- Rhode Island does not provide a specific mileage allowance under its current remote-work provision.
- An MLO’s residence or other remote location must be a “reasonable distance” from a licensed place of business or branch.
- The home is not a branch if the remote-work conditions are satisfied, including no face-to-face meetings with customers, not holding the residence out as a business location, not having any physical loan records, secure systems, and proper supervision.
New Mexico – Historically 75 Miles, But Currently Under Remote-Work Policies
- New Mexico FID previously considered 75 miles to be an allowable commuting distance from a licensed branch.
- However, FID’s November 2020 telework policies remain in effect for 2026, and FID has no plans to change or remove them.
- Therefore, companies must have an alternate plan, as FID may remove or change the policies at any time.
New Jersey – Approximately 2.5 Hours.
- Present mortgage-industry licensing guidance defines New Jersey’s “reasonable commuting distance” as about 2.5 hours from the licensed location.
- NJDOBI requires each licensed branch to have a branch manager who must be on-site.
- I recommend confirming the commuting distance requirement with NJDOBI before assigning a remote MLO, since the 2.5-hour standard is not included in NJDOBI’s current published materials.
Nebraska — Approximately a Two-Hour One-Way Commute
- Current guidance indicates MLOs must be within a two-hour one-way commute of the sponsoring office.
- Nebraska law allows the Department to permit mortgage origination from remote locations.
- Confirm the current supervisory arrangement with the Department or consult the NMLS checklist before opening a branch.
Wyoming — Approximately 100 Miles
- Current guidance designates Wyoming as a 100-mile supervisory-distance state.
- While the regulator’s page confirms individual MLO licensing through NMLS, it does not reference the 100-mile rule.
- Until confirmed by the regulator or NMLS, treat the 100-mile distance as an operational compliance requirement.
What About New York?
- New York requires special attention due to its commute distances and supervision requirements.
- In 2026, industry groups petitioned NYDFS to remove these prerequisites and adopt permanent remote-work policies.
- Since current NYDFS materials do not define the standard, confirm requirements with NYDFS or NMLS before relying on the previous “50 miles or two hours” guideline.
This distinction is important, as many online mortgage compliance charts still reference outdated distance rules.
Yes, in certain states, with Wisconsin and South Carolina serving as two of the most explicit examples.
Wisconsin states:
A mortgage loan originator’s residence may be licensed as a branch.
In addition, if the supervising Wisconsin office is more than 100 miles from the MLO’s residence, Wisconsin DFI states the MLO must license the residence as a branch office.
South Carolina states:
A mortgage loan originator’s personal residence may be licensed as a branch if the personal residence is more than seventy-five miles from a commercial branch.
From a regulatory perspective, leasing a Regus office, executive suite, or traditional office is not always required. In some cases, an approved residential branch can satisfy the distance requirement—not the individual MLO acting independently—generally establishes and licenses the branch through NMLS. The residence will become a branch of the licensed mortgage company.
There Is an Important Catch With Licensing Your Home as a Branch
- NMLS included an important warning in its updated April 17, 2026, remote-work guidance:
- If an MLO’s home is licensed or registered as a branch for one state, another state could consider that same home a branch for its purposes as well.
- NMLS, therefore, suggests consulting the applicable regulators prior to that action.
- Accordingly, I do not recommend licensing every remote MLO’s residence as a branch solely as a precaution.
- For most states that have adopted permanent remote-work rules, the preferred structure is typically:
Licensed Company/Branch > Assigned Supervising Location > MLO Works Remotely From an Unlicensed Residence.
- The home would serve as a remote work location, not as a mortgage branch open to the public.
- Borrowers would not visit the residence.
- No signage or physical loan files would be present
- Secure company systems would be used
- Adequate supervision would be maintained
- The residence would not be advertised as a company location
- Rhode Island’s regulations exemplify this structure.
I recommend pursuing a residential branch license only if a state requires it due to distance or classifies the residence as a branch. NMLS specifies that if a state considers an MLO’s remote location a branch, it must be licensed or registered accordingly.
Be Careful With Older State Lists
Several states appearing on older mortgage-company compliance lists should not be automatically included on a 2026 compliance list.
For example, Kentucky now permits permanent remote work and has changed its previous 125-mile rule. Kentucky statutes now allow mortgage-related work, subject to supervisory, information security, record-keeping, and consumer contact restrictions, to be performed at an employee’s alternate work location.
Relying on outdated lists from 2020, 2022, or 2024 may result in unnecessary branch licenses and increased expenses.
My Current 2026 Working List
When evaluating branch-distance issues for remote MLOs, I prioritize the following states in my compliance review:
- Wisconsin – 100 miles
- New Hampshire – 100 miles
- South Carolina – 75 miles
- Rhode Island – reasonable distance
- New Mexico – 75-mile historical standard, currently relaxed by standing telework guidance
- New Jersey – approximately 2.5-hour reasonable commute; confirm with NJDOBI
- Nebraska – approximately two-hour one-way commute; confirm current Department interpretation
- Wyoming – approximately 100 miles; confirm with regulator/NMLS checklist
- New York -commutable-distance requirement remains an issue; obtain the current NYDFS interpretation before relying on an old mileage figure
When addressing these issues by licensing an MLO’s residence as a residential mortgage branch,
- Wisconsin and South Carolina are the most suitable candidates, as their current published rules support this approach.
- Update their remote-work status by August 31, 2026, in preparation for the 2027 renewals.
- This is also an appropriate time to validate all remote MLOs’ residences against their supervising branches in NMLS.
For a national MLO and branch compliance strategy, consider the state regulator, the current NMLS State Licensing Checklist, and timely filing of a residential MU3 when required.
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This reply was modified 1 week, 3 days ago by
Sapna Sharma.
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