Rhode Island Mortgage Broker Bonds Explained
In case you want to operate as a mortgage broker in Rhode Island, you have to fulfill the licensing requirements of state authorities. One of the essential criteria is to post a mortgage broker bond.
The bond functions as a safety net that protects your customers and the state. It further guarantees your legal compliance in the capacity of a mortgage broker in Rhode Island.
With the bond represents a three-party contract, the principal is your mortgage business. The obligee is the Rhode Island Department of Business Regulation, which imposes the requirement. The surety is the third party that gets you bonded.
Questions about Mortgage Broker Bonds in Rhode Island
Who needs to obtain this bond?
You need to provide a surety bond in order to get a Rhode Island mortgage broker license. Its purpose is to ensure you will adhere to Title 19 of the Rhode Island General Laws, plus any other relevant laws.
The licensing authority in the state is the Department of Business Regulation. As in other states, however, the licensing process is conducted via the Nationwide Multistate Licensing System & Registry (NMLS).
How much does the bonding cost?
The bond amount necessary for getting a Rhode Island loan broker license varies depending on the number of office branches you want to operate in the state:
1-3 locations - $20,000
4-7 locations - $30,000
8+ locations - $45,000
You only have to cover a bond premium in order to get bonded. It constitutes a small percentage of the required amount, which is set on the basis of your financial strength.
In order to evaluate your surety bond cost, your surety has to examine your personal credit score, business finances, and any fixed and liquid assets you may demonstrate. That's how it can assess the level of bonding risk. Your premium would be lower if your finances are in good shape.
|Rhode Island Mortgage Broker Bond Cost Based on Credit Score|
|Number of branches in the state||Surety bond amount||Above 700||Between 650-699||Between 600-649||Below 599|
|One to three branches||$20,000||$100-$250||$150-$300||$400-$1,000||$1,000-$2,000|
|Four to seven branches||$30,000||$150-$375||$225-$450||$600-$1,500||$1,500-$3,000|
|More than eight branches||$45,000||$225-$562.5||$337.5-$675||$900-$2,250||$2,250-$4,500|
Is it possible to get bonded if I have financial problems?
Yes, you can get bonded with Lance Surety Bonds even if you are struggling with financial problems. Our Bad Credit Surety Bonds program is designed for applicants with low credit scores, tax liens, bankruptcies, and civil judgments.
Because of the higher bonding risk, the rates are between 5% to 10%. Still, as we collaborate with a number of A-rated, T-listed surety companies, we are able to offer you a top bonding option.
How do I get my bond?
It is easy to apply for your bond online. You can fill out our online application form (it takes 5min) and attach your documents. Then we can send you an exact quote. If you're happy with it, you can buy your bond online.
Want to know more about the intricacies of the bonding process? Here is our in-depth How to Get Bonded guide.
In case you have more questions or need help with your application, don't hesitate to reach us at (877) 514-5146.
How are bond claims handled for mortgage brokers?
You can receive a claim against your mortgage broker bond if you fail to comply with Rhode Island laws. This is the mechanism through which harmed parties can demand fair reimbursement for damages they have suffered due to your illegal actions. The maximum penal sum is the bond amount you have posted.
On proven claims, your surety will pay out the costs at first. Then you have to repay it fully, as set in the bond indemnity agreement. Thus, claims can be a serious financial burden for your business, so it is best to avoid them. They can also prevent you from getting bonded and licensed in the future.
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What Our Clients Have To Say?
Kimberlee AblesQuick 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!
Andrew PoincotLong 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!
Margie MartinezWe 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!