Surety Bond News

SB 184 is a new law that was presented in Minnesota State relating to post-secondary institutions. The new law authorizes alternative types of security for the present surety bond required of post-secondary institutions that have dropped below the U.S. Department of Education’s minimum financial standards to partake in Title IV programs. The present legislation requires a surety bond in a minimum quantity of $10,000 or more than $250,000 conditioned on the performance of all agreements or contracts with students. SB 184 authorizes cash or securities to be deposited in the place of the surety bond.

Consumer collection agencies are affected by a new law in the State of Minnesota. The new law, which is referred to as SB 2839, boosts the surety bond required of consumer collection agencies from $20,000 to $50,000 plus an extra $5,000 for every $100,000 attained from Minnesota debtors in the previous year. The surety bond cannot surpass $100,000. This is active for surety bonds acquired or renewed after January 1st, 2011.

SB 2510 is a new law that was presented in the State of Minnesota concerning plumbers within the State. The new law modifies several surety bond requirements. The new legislation terminates an exception from the surety bond requirements for plumbers employed by master plumbers. All plumbers must attain a minimum $25,000 license bond under the present law. SB 2510 also states that the present surety bond required for manufactured home installers, residential roofers and sign contractors must be a biennial surety bond. The previous law only called for a yearly bond.

The State of Minnesota enacted a new bill regarding consumer collection agencies. The new bill, which is titled SB 2839, amplifies the surety bond required of consumer collection agencies from $20,000 to $50,000 plus an added $5,000 for every $100,000 acquired from debtors within Minnesota in the previous year. The surety bond cannot surpass $100,000. SB 2839 is effective for surety bonds attained or renewed after January 1st, 2011.

Mortgage loan originators are affected by a new law that was enacted in Minnesota State. The new law is named SB 2510 and requires mortgage loan originators to be licensed and covered by a surety bond. It is acceptable to either acquire a bond or be covered through their employer’s bond if they are the member of staff or exclusive agent of an individual subject to the surety bonding requirements. The surety bond must supply coverage for all mortgage loan originators and must be in a quantity that mirrors the dollar amount of loans originated. The Commissioner of Commerce will establish the surety bond quantity.

SB 2510 alters the present license requirements for residential mortgage loan originators as well. The previous law required mortgage loan originators to be licensed and acquire a minimum surety bond of $50,000 or an irrevocable letter of credit. The originators also could have sustained a minimum net worth of $250,000 or be accepted as a mortgagee by the U.S. Department of Housing and Urban Development or the Federal National Mortgage Association. The alternative of attaining a letter of credit or meeting net worth requirements are terminated under the new legislation. The new law requires residential mortgage loan originators to acquire a $100,000 surety bond that covers all mortgage loan originators that are staff or independent agents of the licensee. Upon renewal, the surety bond must be in a quantity that emulates the licensee’s sum dollar amount of the closed residential mortgage loans originated in Minnesota. The surety bond quantities must be according to the following schedule:

Dollar Amount of Loans Bond Amount
$0 to $5 million $100,000
$5,000,000.01 to $10 million $125,000
$10,000,000.01 to $25 million $150,000
Over $25 million $200,000