The pulling of its license comes two weeks after Connecticut also axed the mortgage fintech's ability to originate loans following an investigation which concluded that the company failed to "to demonstrate that it's [financially responsible]." Arizona is the only state left in which Loansnap has a branch, the Nationwide Multistate Licensing System shows.

A filing from California's regulator states that Loansnap's license was pulled because its surety bond expired Aug. 4 and was never renewed.

The fintech's nonrenewal is in violation of California's financial code and grounds for the revocation of a license issued, California's Department of Financial Protection and Innovation wrote in its notice Oct. 18.

Loansnap did not immediately respond to a request for comment Wednesday.

Earlier this year, the fintech lender was evicted from its Costa Mesa, California office, the building's landlord confirmed in June. MGR Real Estate is suing the company for $537,304 for past due rent.

It also faces additional litigation from vendors and partners for nonpayment. Loansnap is being sued by stakeholders including Wells Fargo Bank, Optimal Blue and Mortgage Capital Trading. Litigation by Wells Fargo accuses the fintech lender of selling it a loan that did not meet contractual requirements. It is asking for over $400,000 in damages. Optimal Blue is seeking a little over $200,000 for unpaid services.

All of these suits cast doubt on Loansnap operating "honestly, fairly and efficiently," Jorge Perez, banking commissioner in Connecticut, wrote in a consent order Oct. 2, which revoked the fintech's license. Events leading to the company's loss of its license occurred earlier this year when it applied for a renewal and instead received a cease and desist order related to allegations that some of its staff performed unlawful mortgage activity. That order threatened potential revocation of its license to do business in Connecticut. 

In a filing dated Jan. 4, the state claimed Loansnap used unlicensed mortgage originators between August and December 2022, when they accepted applications, solicited potential borrowers and offered or negotiated residential loan terms in violation of both the federal Secure and Fair Enforcement for Mortgage Licensing Act and state laws. 

The lender "denied in large part" the allegations asserted, Connecticut filings at the time show. The filings did not provide details of the company's response to the state.

Loansnap currently sponsors two loan officers, according to the NMLS. Data from S&P shows the company previously secured $57.7 million through four funding rounds from 14 investors.