Surety Bond News

Enacted in Hawaii, a new law is now in place affecting mortgage loan originators within the state. The new law which is labeled SB 1218 integrates the federal definition of a mortgage loan originator. The law also requires originators to obtain a surety bond in a quantity that would be calculated by the dollar amount of the loans originated. Should the loan originator be an employee or an exclusive agent of a licensee, the coverage under the employer’s surety bond would satisfy the bonding requirements. SB 1218 requires the surety bond to cover all of the originators. The State Governor prevented the bill, but the legislature reversed the veto and SB 1218 became law. SB 1218 was introduced on 1/27/2009 and enacted on 7/15/2009.

Mortgage loan originators are affected by a new law in the state of Delaware. Named SB 73, the new law demands that mortgage loan originators be licensed and covered by a surety bond in a quantity calculated by the dollar amount of the loans originated. Should the loan originator be an employee or an exclusive agent of a licensee subject to existing bond requirements, coverage under the employer’s bond can satisfy the bonding requirements. The present law asks mortgage brokers to acquire a $25,000 surety bond while mortgage lenders must acquire a surety bond of $50,000 to $200,000, based on loan volume. SB 73 requires the surety bond to supply coverage for all originators, and it leads the State Bank Commissioner to implement rules to add the bond requirements. The surety bond quantity must reflect the volume of loans originated. SB 73 was enacted on July 6th, 2009.