Surety Bond News

The state of New Hampshire enacted new legislation concerning mortgage originators. The new law is labeled HB 610 and requires all mortgage originators to be licensed and to be covered under the license bond of the mortgage broker/banker of which the originator is a member of staff or an independent agent. The previous law required mortgage bankers to sustain a net worth and a $100,000 surety bond and asked mortgage brokers to acquire a $20,000 surety bond. HB 610 amplifies these quantities so that mortgage bankers must attain a surety bond no less than $100,000 and brokers must attain a surety bond of no less than $50,000. The amount of the surety bond has to be in a quantity that mirrors the dollar amount of the loans originated by the individual mortgage loan originators the mortgage banker/broker employs. The surety bond must also cover all the said originators.

Mortgage loan originators are affected by a new bill that was presented in the state of Mississippi. The new law, which is labeled SB 2983, requires mortgage loan originators to be covered by a surety bond in a quantity that is calculated by the dollar amount of the loans originated. Should the loan originator be a member of staff or an agent of a licensee subject to this bonding requirement, coverage under the employer’s surety bond will satisfy the new bill’s stipulations. SB 2983 requires the surety bond to supply coverage for all originators. The new bill became active on July 31st, 2009.

The state of Missouri has implemented a new bill concerning mortgage originators. The new bill is named HB 382 and requires mortgage originators to be licensed and to be covered by a surety bond required of mortgage loan brokers. HB 382 asks residential mortgage loan brokers to acquire a surety bond that covers all of the mortgage originators that are the broker’s staff or agents. The quantity of the surety bond must mirror the dollar amount of loans originated. The surety bond amount is also capped at $1 million, with a bare minimum of $50,000. The Director of the Division of Finance will establish the levels of bonding by regulation. The previous law required residential mortgage loan brokers to acquire a license bond of $20,000. The bill provides for direct actions on the surety bond from borrowers. The new bill also canceled the option of a surety bond that was allowed in place of yearly auditing of a mortgage broker’s financial records. A $100,000 surety bond or a letter of credit was required in the place of the audit.

Iowa state introduced a new law relating to mortgage originators. The new law is labeled SB 355 and requires mortgage originators to be covered by a surety bond, but if the surety bond requirement is not possible, SB 355 authorizes the Superintendent of Banking to institute a recovery fund. The new law states that the surety bond covering mortgage loan originators must mirror the dollar amount of loans originated according to the Superintendent’s resolution. If the originator is a member of staff or the exclusive agent of a mortgage broker, mortgage banker, industrial lender or a consumer lender, which are subject to surety bond requirements under present law, then the employer’s surety bond will be sufficient for the bond requirements put on originators. SB 355 requires the Superintendent of Banking to set the bond requirements using regulations so that the surety bond quantity will replicate the dollar amount of loans originated for an employer’s surety bond.

Georgia State enacted a new law affecting mortgage originators. The new law, titled HB 312, requires mortgage originators to be both licensed and bonded. The present law demands mortgage brokers to acquire a $50,000 surety bond and requires mortgage lenders to acquire a $150,000 surety bond. HB 312 requires mortgage loan originators to be covered by a surety bond; either by obtaining one, using the surety bond of their employer (only if the originator is the employee or exclusive agent of an individual subject to the surety bond requirements for brokers/lenders). The surety bond must supply coverage for every loan originator in a quantity that mirrors the amount of currency of loans originated. HB 312 was enacted on April 29th, 2009.