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Montana Mortgage Broker Bonds Explained
Mortgage brokers who want to operate in Montana have to go through a licensing procedure with state authorities. You need to provide a mortgage broker bond as one of the main requirements.
The bonding criteria set by the licensing body guarantees that your mortgage brokerage will adhere to applicable laws. Thus, the bond protects your customers against potential illegal and harmful actions on your side.
In practical terms, the mortgage broker bond represents a contractual agreement, in which your business is the principal. The Montana Division of Banking and Financial Institutions is the obligee that sets the licensing requirements. The third party is the surety, which provides you with the bond.
Questions about Mortgage Broker Bonds in Montana
When do I have to get this bond?
Obtaining a surety bond is one of the obligatory requirements that you have to satisfy, so that you are granted a Montana mortgage broker license. The bond amount is set on the basis of your combined annual loan production volume. It ensures your compliance with the Montana Mortgage Act and other relevant laws.
The Nationwide Multistate Licensing System & Registry (NMLS) handles the licensing procedure. However, all criteria are set by the Montana Division of Banking and Financial Institutions.
What are the bonding costs?
The bonding amounts for Montana mortgage brokers are between $25,000 and $100,000, depending on your combined yearly loan production volume. However, you only have to pay a bond premium that is a small percentage of the required amount. It is set on the basis of your financial strength.
In order to determine your exact surety bond cost, your surety has to examine your personal credit score, business finances, and any fixed and liquid assets. By doing this, it can judge the bonding risk involved. If your finances are in good shape, you can expect to pay less for your bond.
| Montana Mortgage Broker Bond Cost Based on Credit Score | |||||
|---|---|---|---|---|---|
| Combined annual loan production volume | Surety bond amount | Above 700 | Between 650-699 | Between 600-649 | Below 599 |
| $0 - $50 million | $25,000 | $125-$312.5 | $187.5-$375 | $500-$1,250 | $1,250-$2,500 |
| $50 million - $100 million | $50,000 | $250-$625 | $375-$750 | $1,000-$2,500 | $2,500-$5,000 |
| More than $100 million | $100,000 | $500-$1,250 | $750-$1,500 | $2,000-$5,000 | $5,000-$10,000 |
What happens if my credit is bad?
It is more difficult to get bonded if your finances are not stellar. Lance Surety Bonds has designed its Bad Credit Surety Bonds program for applicants who struggle with low credit scores, tax liens, bankruptcies, and civil judgments.
Due to the increased bonding risk, the bad credit premiums are between 5% to 10%. We work closely with a number of A-rated, T-listed surety companies. This allows us to offer you a top bonding rate that matches your particular situation.
How do I get my bond?
The first step to getting bonded is to fill out our online application form (it takes 5min). Whenever we have your full set of paperwork, we can send you an exact quote. If you're happy with it, you can purchase your bond straight away.
Need more information on the bonding process? Find out the nitty-gritty details in our How to Get Bonded guide.
For more questions or if you need help with your application, you can reach us at (877) 514-5146.
How are bond claims handled for mortgage brokers?
The purpose of your mortgage broker bond is to protect your customers and the state. Thus, if you fail to follow the law, it works as a safety mechanism for them. A harmed party can file a claim against your bond and thus seek fair reimbursement.
The maximum compensation is the penal sum of the bond that you have posted, which is between $25,000 and $100,000 for Montana mortgage brokers. If the case is proven, you are liable to pay the claim costs. At first, your surety may cover them, but you need to repay it fully, as set in the bond indemnity agreement.
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Quick response times and turn around for issuing bonds. Great customer service and very knowledgeable. We have used Lance Surety multiple times and have never been disappointed. Highly recommend them and Collette!
Long story short, these guys cut through the B.S. and get the job done. Responsiveness, excellent! Communication, excellent! Respect for their industry partners, excellent! John, Collette, Ryan, you're all-stars! Thank you!
We decided for Lance Surety Bond's quote for 2 reasons; Price and Customer Service. Our Representative Ryan was just SUPERB!! [...] I highly recommend Lance Surety Bond for all your Bonding needs! I'll definitely come back for all of mine. :-) Thanks Ryan!
Quick response times and turn around for issuing bonds. Great customer service and very knowledgeable. We have used Lance Surety multiple times and have never been disappointed. Highly recommend them and Collette!
Long story short, these guys cut through the B.S. and get the job done. Responsiveness, excellent! Communication, excellent! Respect for their industry partners, excellent! John, Collette, Ryan, you're all-stars! Thank you!
We decided for Lance Surety Bond's quote for 2 reasons; Price and Customer Service. Our Representative Ryan was just SUPERB!! [...] I highly recommend Lance Surety Bond for all your Bonding needs! I'll definitely come back for all of mine. :-) Thanks Ryan!
