Tennessee Mortgage Broker Bonds Explained
Tennessee mortgage brokers need to undergo a licensing procedure with state authorities that guarantees they meet the requirements for this type of professionals. As a part of this process, you have to provide a mortgage broker bond.
Serving as a safety mechanism, the bond protects your customers against potential illegal activities you may engage in as a broker. Thus, it ensures your legal compliance.
Your bond constitutes a contract between three entities, with your business being the principal which needs the bonding. The obligee is the Tennessee Department of Financial Institutions that imposes the requirement. The third party is the surety, which provides you with the bond.
Questions about Mortgage Broker Bonds in Tennessee
When do I need to get bonded?
In case you want to obtain a Tennessee mortgage license as a loan broker, you have to get a $90,000 surety bond. Its purpose is to guarantee you will follow all applicable laws, including Title 45, Chapter 13 of the Tennessee Code.
As for other types of financial services professionals, the Nationwide Multistate Licensing System & Registry (NMLS) handles the licensing and bonding documents. The licensing requirements, however, are set by the Tennessee Department of Financial Institutions.
How much does the bonding cost?
In order to get licensed as a Tennessee mortgage broker, the bond amount that you have to post is $90,000. Your bond premium is a fraction of this amount, which is set on the basis of your financial profile.
The surety provider has to examine your personal and business finances to determine how risky the bonding is. The exact surety bond cost depends on factors like your personal credit score, company paperwork, and any fixed and liquid assets. If the risk is perceived as low, your premium will also be smaller.
|Tennessee Mortgage Broker Bond Cost Based on Credit Score|
|Surety bond name||Surety bond amount||Above 700||Between 650-699||Between 600-649||Below 599|
|Mortgage loan broker bond||$90,000||$450-$1,125||$675-$1,350||$1,800-$4,500||$4,500-$9,000|
What if I have bad credit?
Lance Surety Bonds has designed its Bad Credit Surety Bonds program to serve applicants with financial problems such as low credit scores, tax liens, bankruptcies, and civil judgments.
As the bonding risk is higher, the rates are in the range of 5% to 10%. Our excellent partnerships with a number of A-rated, T-listed surety companies, nevertheless, allow us to offer you a top bonding option.
How do I get my bond?
The first step to getting your mortgage broker bond is to complete our online application form (it takes 5min). Then you have to provide your full paperwork, so that we can assess your exact quote. If you're satisfied with it, you can buy your bond online straight away.
You can find extensive details about the bonding process on our How to Get Bonded page.
Have further questions? You can consult our bonding experts by calling us at (877) 514-5146.
How are bond claims handled for mortgage professionals?
The purpose of your broker bond is to safeguard the interests of your customers and the state in which you operate. Thus, if you transgress from your legal obligations, you can end up with a claim against the bond.
Harmed parties can demand reimbursement of up to $90,000, which is the penal sum of the bond. If the claim is proven, you have to pay the due compensation. The surety that backed you may at first cover these costs, but you have to fully repay it afterwards. This is set in the bond indemnity agreement. As a result, bond claims can bring serious problems for your business, so it is best to avoid them as much as possible.
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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!
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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!