HB 2463, enacted on 08/17/2008, is a new North Carolina state law. HB 2463 manages mortgage servicers and requires them to follow the same licensing, bond and qualification provisions as mortgage lenders. The existing law requires a surety bond of $150,000. Alternatives to the bond are cash or securities in the same amount; as well as is a financial statement representing a net worth of $250,000. Existing law already authorizes and gives precedence to direct customer claims. HB 2463 became active on January 1, 2009.
-
North Carolina Mortgage Servicers Bond
November 2, 2009 by Eric WeisbrotCategory: Commercial Bonds, Mortgage Banker Bonds, Mortgage Broker Bonds, Surety NewsTags: bond requirements, legislation, mortgage servicers, mortgage servicers bond, NC, North Carolina, surety bond | Comments (0)
-
Connecticut Correspondent Lenders Bond
September 24, 2009 by Lisa Grimsley
Effective July 1, 2008, correspondent lenders in Connecticut now follow the same bond requirements as mortgage lenders and brokers, according to the HB 5577 enactment. The bond amount is also increased from $40,000.00 to $80,000.00. There are new regulatory requirements for mortgage brokers and lenders. The law specifies new permissible and prohibited actions for mortgage brokers and lenders. If there are any unpaid costs of an examination of a license, the bond is required to respond to it. The Banking Commissioner is no longer required to automatically suspend the license on the date the license bond is canceled unless it is renewed or replaced. If the licensee does not pay the costs after 30 days of an examination, the license will be suspended.Category: Commercial Bonds, Mortgage Banker Bonds, Mortgage Broker Bonds, Surety NewsTags: connecticut, correspondent lender, correspondent lender bond, ct | Comments (0)
-
West Virginia Mortgage Lender License Bond Amendment
August 24, 2009 by Eric Weisbrot
On 03/27/2008, the state of West Virginia enacted SB 292. The new law authorizes the Commissioner of Banking to make a claim for an unpaid civil administrative penalty or an unpaid assessment invoice against a mortgage lender’s license bond. The law in place allows claims against the bond directly from consumers. The new law became active on June 7, 2008.Category: Commercial Bonds, Mortgage Banker Bonds, Surety NewsTags: bond requirements, legislation, mortgage banker, mortgage lender, surety bond, west virginia, wv | Comments (0)
-
Changes For Mortgage Broker Bonds & Mortgage Lender Bonds
February 28, 2009 by Rick BredowNew state legislation is changing the way many brokers and lenders will conduct future business, as there have been numerous changes in 2008-2009 timeframe which will affect mortgage brokers and mortgage lenders.
First, a primary change will be the increased required bond amounts along with tighter regulations that will be imposed on business transactions and pre-licensing certifications. Although some of this new state legislation has passed, it seems like many states are set waiting critical decisions from Congress, which is expected to jump start the weakened economy. Many states are taking a back seat to changing regulations until they see how the new president’s economic stimulus package will affect the mortgage industry, as well as being afraid to move too quickly to adopt new legislation, since remembering the demise of the sub-prime mortgage crisis which left many small mortgage brokers and lenders out of business or severely crippled. In addition, many states are looking to the government for their proposed solution to the housing crisis. The combination issues of the current economy & housing crisis may result in a decrease of licensing for brokers and lender in this upcoming year. New legislation passed that went into effect mid 2008 and are effective for all renewals in 2009 & introduced in the following states: Connecticut, Iowa, and Maryland which have all increased the required bond amounts.
• Connecticut has increased their required bond amount from $40,000 to $80,000 effective August 1st, 2009.
• Iowa increased the required bond amount from $50,000 to $100,000 effective 12/31/08.
• Maryland has made increases in the bond amounts based on the volume of loans. Their $25,000 requirement has increased to $50,000, the $50,000 requirement has increased to $100,000, and their $75,000 requirement has increased to $150,000.
In addition, four (4) other states attempted to pass legislation that would increase the required bond amount and impose tighter requirements for mortgage brokers and lenders in 2008. Those states included Hawaii, Missouri, Oregon, and South Carolina, all which rejected the proposed increases and thereby postponing any decisions at this time. These states have concluded to revisit this legislation in 2009 once the economic situation is further determined for 2009. The state of Alabama had a proposal on the table to enact legislation requiring a bond for mortgage brokers and bankers for the 2009 license period. This legislation did not pass and will be revisited in mid 2009.It is further expected that we will see many changes in 2009 to the legislation and bond requirements that affect mortgage brokers and lenders. The primary focus of the state legislation is expected to reduce the amount of claims and keep business owners working honestly and ethically. Keep in mind, that with the economy in crisis there will be many changes in the future that will affect your license and your bond. To remain best advised of these current changes, keep in contact with your state licensing agency.
Category: Commercial Bonds, Mortgage Banker Bonds, Mortgage Broker Bonds, Surety NewsTags: connecticut, Hawaii, iowa, legislation, maryland, Missouri, mortgage broker, mortgage crisis, Oregon, South Carolina | Comments (1)
-
Connecticut Increases Mortgage Bond Requirements
January 30, 2009 by Rick BredowThe Connecticut House Bill 5577 increases the mortgage bond requirements in the State of Connecticut by doubling the amount of existing bonds. This Bill became effective on July 1, 2008. The passing of this Bill is not good news for licensed Mortgage Brokers and Lenders in the State of Connecticut, since this Bill requires that all Mortgage Brokers and Lenders carry a bond for $80,000. All licensed Brokers and Lender must be compliant by August 1, 2009.
What will this mean to the thousands of Mortgage Brokers and Lender in the state of Connecticut? Bottom-line financially, they will be paying more for their Surety Bonds to be compliant with the state guidelines. The Surety Companies will be looking a bit closer at applications and increases for bonds in Connecticut due to the now large requirement of $80,000. Surety underwriters will be looking a bit closer at Net Worth of the business and the owners of the company. They will want to make sure there will be enough cash in reserves to handle any claims that could arise. Due to the increased bond requirements, the affect on Mortgage Brokers and Lenders that may have issues with personal credit will result in difficulty securing lower rates for these bonds. The bill allows for in increase in personal net worth from $25,000 to $50,000. There will be a few markets that will be positioned to write these
bonds, but overall it can be expected that they will be looking for larger premiums, due to the increased financial risks. In addition, this bill will combine existing “First� and “Second� mortgage expert licenses into one combined license that will cover all activities and require that all applicants are using the Nationwide Mortgage Licensing System (NMLS). The state will also require that the license have an expiration date of December 31st of the following year.
To summarize further changes in the Bill, the State of Connecticut requires each licensee to contact the state license center, if any of the following occur:
• Licensee experiences a bankruptcy
• Criminal Indictment of any type
• Provide notice of license denial, cease and desist, license suspension, and or fines from any other licensing entity
• Notification by any agency of the Attorney General
• Any revocation of a warehouse line of credit
• Notification of any license holders owning over 10% of the company filing bankruptcy
• Notification of ownership changesNeglecting to report any of the occurrences above could result in suspension or revocation of a license.
With all these changes in the State of Connecticut, we can expect the Surety Companies to tighten their guidelines and underwriting practices and these bonds will not be as easy to get as they have been in the past. For specific rules and regulations, it is strongly recommended visiting the Connecticut State Website for more specific licensing requirements.
Category: Commercial Bonds, Mortgage Banker Bonds, Mortgage Broker Bonds, Surety NewsTags: bond reuirements, connecticut, legislation, mortgage broker | Comments (0)
