California DFPI Audits for CRMLA & CFL Licensees
Need an audit done for your California DFPI license?
California residential mortgage lenders and servicers licensed under the CRMLA must file an annual audit by an independent CPA within 105 days of year end, and the DFPI relies on it to confirm your $250,000 tangible net worth. Finance lenders licensed under the CFL need sound GAAP financial statements too, and often a full audit for their warehouse lenders or investors.
If you need a CPA who knows these requirements and can deliver a clean, NMLS-ready report on time, you are in the right place.
How can we help?
We are CPA auditors who specialize in financial statement audits for companies licensed by the California Department of Financial Protection and Innovation (DFPI). Our DFPI clients include residential mortgage lenders and servicers licensed under the California Residential Mortgage Lending Act (CRMLA) and finance lenders and brokers licensed under the California Financing Law (CFL).
Whether you are applying for a CRMLA license, filing your annual audit to keep it active, or need CPA-prepared financial statements for your CFL license, investors, or warehouse lenders, we know what the DFPI looks for and how to deliver a report that clears review the first time.
California sets a high bar for mortgage lenders. CRMLA licensees must have their books audited by an independent CPA every year and upload the audited financial statements to NMLS within 105 days of fiscal year end. The audit must show tangible net worth of at least $250,000, maintained at all times, and the DFPI also expects supplementary CPA reports with it, including a report on internal control.
CFL licensees must maintain a net worth of at least $25,000. That rises to $250,000 for lenders that employ mortgage loan originators and make residential mortgage loans, and $50,000 for brokers that employ loan originators and arrange, but do not make, residential mortgage loans. CFL license applications require financial statements prepared under U.S. GAAP, and many CFL lenders also need audited statements for warehouse lines, investors, or agency approvals.
We’ll help you accomplish the following:
- Audited financial statements for your CRMLA license application or annual NMLS filing
- The supplementary CPA reports the DFPI requires with your CRMLA audit, including the report on internal control
- GAAP financial statements for your CFL license, with a full audit when your lenders or investors require one
- Tangible net worth presented clearly against the $250,000 CRMLA minimum
- Reports delivered ahead of the 105-day deadline so you avoid late filings and license action
How it works?
Our DFPI audit approach is built around the specific rules for CRMLA and CFL licensees, so we move faster than firms that treat every engagement the same way. Here’s how it works:
- Understanding your license and activity – We confirm whether you hold a CRMLA license, a CFL license, or both, your fiscal year end, and whether you originate, service, or both, so we know exactly which reports the DFPI expects.
- Planning and document gathering – We collect the records needed to start fieldwork and build the timeline backward from your 105-day NMLS filing deadline.
- Fieldwork and testing – We test cash, loans held for sale, trust accounts, warehouse lines, and the intangible assets that reduce tangible net worth, making sure everything lines up with what DFPI examiners expect.
- Reporting – Once fieldwork is complete, we issue the audit report and supplementary reports, ready for you to upload to NMLS.
Most engagements are completed in 4 to 6 weeks. Everything is handled digitally, so it doesn’t matter if your business is in Los Angeles, Orange County, San Diego, the Bay Area, Sacramento, or anywhere else in California.
If you are a California mortgage lender, servicer, or finance lender that needs a financial statement audit for the DFPI, please contact us.
About Metwally CPA PLLC
Metwally CPA PLLC is a CPA firm founded by Mohamed Metwally, CPA, CMA, EA. We specialize in audit and assurance services for small and mid-sized businesses in Texas, Florida, and beyond, including mortgage lenders, regulated lenders, franchisors, nonprofits, PEOs, and career schools regulated by state agencies.
Mohamed holds active CPA licenses in Texas and California, an M.S. in Accounting from the University of Dallas, and has extensive assurance experience across a wide range of regulated industries. He is a member of the American Institute of Certified Public Accountants and the Texas Society of Certified Public Accountants, and serves on TSCPA Practice Issues, Diversity and Inclusion, and Governmental Accounting and Single Audits Conference committees.
We have completed over 100 audit engagements, and every one is delivered digitally, at a fixed rate, with responsiveness measured in hours rather than days.
FREQUENTLY ASKED QUESTIONS
As a California residential mortgage lender or servicer, you are required to file audited financial statements with the DFPI every year to keep your CRMLA license in good standing. Below are the most common questions we get about DFPI audit requirements:
A DFPI audit is an independent audit of your company’s financial statements by a CPA, prepared under U.S. GAAP. For CRMLA licensees, the DFPI uses it to confirm you meet the $250,000 tangible net worth requirement and that your financial condition supports your lending and servicing activity.
Yes. A CRMLA application must include audited financial statements with an unqualified opinion, prepared as of your most recent fiscal year end or a more recent date. After licensing, you must file an audit every year.
Within 105 days after your fiscal year end, uploaded to NMLS. For a December 31 year end, that means April 15 (April 14 in a leap year).
The DFPI asks for a CPA report on internal control, a CPA report stating the audit followed the HUD Consolidated Audit Guide, and a CPA report under the Mortgage Bankers Association’s Uniform Single Attestation Program. If the HUD report isn’t available, year-end origination trust account reconciliations can be submitted instead; if the USAP report isn’t available, year-end servicing trust account reconciliations can be used, or a sub-servicer’s USAP report.
CRMLA licensees must maintain tangible net worth of at least $250,000 at all times. CFL licensees need $25,000, or $250,000 if they employ mortgage loan originators and make residential mortgage loans, or $50,000 if they employ loan originators and only arrange residential mortgage loans.
Not by default. A CFL application requires financial statements prepared under U.S. GAAP that show the required net worth, and licensees file an annual report with the DFPI by March 15. Many CFL lenders still get audits because warehouse lenders, investors, or agencies such as Fannie Mae require them.
The DFPI treats both seriously. It has brought license revocation actions against CRMLA lenders for unfiled audits and for falling below the $250,000 tangible net worth requirement. Planning the audit early is the easiest way to stay clear of that.
Not for CRMLA. The DFPI requires audited financial statements prepared by an independent CPA. For CFL licensees, the right level of service depends on what your application, lenders, or investors require, and we will tell you up front.
Most engagements are completed in 4 to 6 weeks from the signed engagement letter. We plan the schedule around your 105-day deadline so your filing goes in on time.
Cost depends on the size of your operation, whether you originate, service, or both, and the condition of your records. Metwally CPA gives you a fixed-rate quote upfront, with no hourly billing and no surprises later.
Yes. Mohamed Metwally holds an active California CPA license, and we work with California lenders and servicers remotely, with every engagement handled digitally from planning to final report.
Please note that while this information provides a general understanding of California DFPI audit requirements, it is recommended to consult with a financial professional or auditor for specific guidance related to individual situations. If you have any questions, please contact us.