Mortgage brokers, bankers, and servicers are all affected by a law update in the state of Arkansas. Named HB 1881, the new law updates the current surety bond requirements for mortgage bankers, brokers and servicers. The previous law required mortgage bankers and servicers to obtain a surety bond in the amount of $100,000; while mortgage brokers had to obtain a $50,000 surety bond. HB 1881 allows the Securities Commissioner to prescribe the quantity required through regulations. The surety bond amount will be calculated by the mortgage banker’s, broker’s or servicer’s loan activity in the preceding year and it must be less than $100,000. The surety bond also has to cover the loan officers that a banker, broker or servicer employs, assuring the loan officer’s truthful performance of their responsibilities and be for the state’s advantage for claims in opposition to the officer. HB 1881 also revoked provisions of previous law that authorized cash or other security in place of the surety bond so that only a surety bond will be acknowledged.
Eric is the Chief Marketing Officer of JW Surety Bonds. With years of experience in the surety industry, he is also a contributing author to the surety bond blog.