Expanded Commercial Loan Exemption Under California Finance Lenders Law

As a result of the passage of Assembly Bill No. 1091 (“AB 1091”), persons1 that make only occasional commercial loans in California may be able to take advantage of an expanded licensing exemption under the California Finance Lenders Law (the “CFLL”), §§ 22000 et seq. of the California Financial Code.


Under California law, “finance lenders” (subject to certain limited exceptions) making loans in California are required to obtain a license from the California Department of Business Oversight2 and comply with the licensing and regulatory requirements of the CFLL and the regulations thereunder. A “finance lender” is broadly defined in Cal. Fin. Code § 22009 as “any person who is engaged in the business of making consumer loans or making commercial loans.”

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