New York legislators have re-adopted regulations to implement AB 6924 (2009). The New York Banking Department now requires mortgage loan originators to obtain a surety bond. Should the originator be an employee or exclusive agent of an originating entity subject to the present surety bond requirements, then the employer’s bond could be utilized to meet the requirement. The current law requires mortgage brokers to obtain a bond ranging from $10,000 to $100,000 calculated by loan application volume; under the new bill they must acquire a bond ranging from $50,000 to $500,000, which is calculated by the volume of New York closed loans. AB 6924 states that the Superintendent has the ability to require a larger bond if the “nature or business of a [mortgage loan originator] or originating entity requires in the reasonable judgment of the Superintendent such additional protection for consumers.”
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.