The Georgia mortgage broker bond is one of the most difficult to place mortgage broker bonds in the country. The bond size is a substantial size and the bond language is very much in the favor of the obligee. Most bonding companies keep away from this higher risk mortgage broker bond, but there are still markets that are willing to write the risk.
Current Market: For the most part, bonding companies shy away from the Georgia mortgage broker bond. However, there are still bonding companies willing to write this bond on a regular basis. Unfortunately, you can not expect to find any programs that will write this bond with minimal information. Any surety willing to write this guarantee will require a full submission, which consists of: general company information, personal financial statements on all owners, business financial statement, resumes on managing member(s), etc.
Bond Amount: The state of Georgia requires a $50,000 bond of their mortgage brokers and a $150,000 mortgage lender bond. A $50,000 bond is on the higher end of license bond average ranges. The size certainly isn’t large enough to scare an underwriter away from writing the bond. However, you can expect the underwriter to give a thorough examination of your application, possibly requiring cash verification or other additional information.
Bond Form: The Georgia state bond form lacks aggregate language, something most bonding companies require in order to write a bond in today’s market. An aggregate clause limits the total amount of claims to the amount of the bond. In other words, an aggregate clause makes it so claims can not exceed $50,000, whether it is one $50,000 claim or five $10,000 claims. The state of Georgia is not only lacking the aggregate clause, it is something they did on purpose. That means that there is no limit to the total amount of claims that can come arise from this bond. This fact is quite scary when we realize that the surety will ultimately hold the principal responsible for repayment of all claims.
Additional State Requirements: The Georgia Department of Banking and Finance regulates mortgage brokers in Georgia. The state requires applicants to pay a $250 investigation fee and a $500 Annual license fee. Georgia also requires CPA audited financial statements and a copy of income tax returns and a passport size picture of the applicant. The state also requires that the applicant have a net worth of $25,000. Two recent years experience or proof of education is required. Original duplicate fingerprints (fee of $30/set) must be provided and permission for pulling credit. Past criminal acts that have not been pardoned will result in the application declination. Mortgage brokers licensed out of state must have a physical location within the state. The location can not be a PO box and must employ at least one employee. If the broker’s home state is not Georgia, they may still obtain a Georgia license if their home state does not require a physical location in it.
Special Programs: Unfortunately, we do not know of any special bond programs for the Georgia mortgage broker bond. One must do a full submission in order to obtain an approval in this difficult to place state. You can apply at: http://www.jwsuretybonds.com/mortbroker.htm