Ohio Mortgage Broker Bond |
AmeriPro Surety Bonds |
Ohio Mortgage Broker Licensees
Ohio mortgage brokers are regulated by the Ohio Department of Commerce – Division of Financial Institutions.
The Department is also the obligee for your required Ohio mortgage broker bond.
In surety lingo, the obligee means that the Department is the entity requiring or mandating that you obtain the surety bond as a condition for licensing.
As an Ohio mortgage broker, you are also required to be in compliance with 1322.01 of the Ohio Revised Code.
Current Ohio state law requires mortgage brokers to obtain a surety bond. AmeriPro Surety Bonds offers this bond for you as both a new and renewal bond.
Ohio Mortgage Broker Bond: The Amount Required
The amount of the Ohio mortgage broker bond that you are required to purchase is a simple formula.
Made easy, it is as follows:
The Ohio mortgage broker bond amount is:
One-half percent (.05%) of the amount of residential loans originated in the most recent prior calendar year;
With a MINIMUM AMOUNT of $50,000 surety bond;
PLUS $10,000 surety bond for each location of your mortgage broker business beyond just one location;
But, the surety bond amount required in any case is NOT to EXCEED $150,000.
In other words your Ohio mortgage broker bond will be somewhere between $50,000 to $150,000 using the above calculations.
Ohio Mortgage Broker Bond: The Purpose
As a licensed mortgage broker, and as you undoubtedly know, you bear on your shoulders a strong fiduciary obligation to the people of the state of Ohio.
The purpose of your Ohio mortgage broker bond is to serve as a financial guarantee that you will be in compliance with all rules, statutes, and laws in the conduct of your mortgage broker operations.
The bond protects those others –the consumer – from acts of fraud, theft, or criminal malfeasance committed by a licensed broker in the course of their related professional duties.
According to Ohio state law, the bond also protects against breaches of warranty, a mortgage broker’s failure to pay the premium, and misrepresentation.
But, to be sure, your mortgage broker bond is not an insurance policy; it is a surety.
In the practical order, one of the things this means is that should a claim be paid on your mortgage broker bond by the surety, it is your legal liability to reimburse the surety for all costs involved in the satisfying of that claim.
Ohio Mortgage Broker Bond: The Premium
The premium for your mortgage broker bond will depend on the following:
- The amount of the surety bond you are required to purchase, as per the above formula;
- A standard application;
- Your credit score.
As a general rule, an applicant with good credit may pay around 1% of the bond amount required.
However, the amount you will be required to pay will be subject to the conditions mentioned above and so it may vary substantially.
Qualifying for the Ohio Mortgage Broker Bond
Besides a standard application, depending on the amount of bond you are required to purchase, you may – or may not –be requested to provide information regarding the following:
- Cash on hand in checking and savings accounts;
- Annual or monthly income – and the source or sources of these;
- Whether you are currently a party to any lawsuits, or have any unsatisfied tax liens or judgments;
- Whether or not you have ever filed bankruptcy;
- Your net worth (defined as your assets minus your liabilities);
- Any real property owned;
- The type, nature, and current market value of any financial investments, and where such investments are held (as in, brokerage accounts)
We bring this up not to scare you — but to prepare you — should you be asked for this information.
Duration of Your Mortgage Broker Bond
The surety bond will generally expire on December 31st of the same year. If for example, you purchase a surety bond in December of the current year, it will expire December of the following year.
The bond must be held active at all times. If you fail to do so, you may find that the state suspends – and in the worse case scenario – revokes your mortgage broker bond.
We don’t want that to happen.
AmeriPro Surety Bonds is a surety bonds-only agency.
We provide license and permit, contractor, court, and fiduciary bonds throughout Ohio.
We also provide mortgage broker bonds nationwide.
We thank you for your consideration and look forward to working with you.
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