Vermont Mortgage Broker Bonds Explained
If you want to start a business as a mortgage broker in Vermont, the first step you should take is to meet the licensing requirements of the state. One of the most important ones is providing a mortgage broker bond.
The goal of the bond is to safeguard the interests of your customers. It serves as a protection mechanism that guarantees you will act lawfully in your capacity as a mortgage broker in the state.
The surety bond works similarly to a contract between three parties. Your mortgage company is the principal that needs to get bonded. The obligee is the Vermont Department of Financial Regulation. The surety is the bond provider that backs your business.
Questions about Mortgage Broker Bonds in Vermont
Who needs to obtain this bond?
You have to post a surety bond, so that you can obtain a Vermont mortgage broker license. The purpose of the bond is to ensure you will follow Title 8 of the Vermont Statutes, as well as other applicable laws.
You need to submit your documents through the Nationwide Multistate Licensing System & Registry (NMLS). The Vermont Department of Financial Regulation, however, is the licensing authority that oversees the financial field in the state.
What are the bonding costs?
The bond amount for Vermont mortgage brokers is between $25,000 and $100,000 and depends on your yearly volume of processed loans. To get bonded, you need to cover a fraction of it, which is known as the bond premium. It depends on the strength of your finances.
In order to determine your surety bond cost, the surety that you apply with considers your personal credit score, business finances, and any fixed and liquid assets you may have. By examining them, it assesses the bonding risk involved. The more stable your overall profile is, the smaller price you are likely to pay for your bonding.
|Vermont Mortgage Broker Bond Cost Based on Credit Score|
|Annual volume of processed loans||Surety bond amount||Above 700||Between 650-699||Between 600-649||Below 599|
|Less than $2 million||$25,000||$125-$312.5||$187.5-$375||$500-$1,250||$1,250-$2,500|
|$2 million to $5 million||$50,000||$250-$625||$375-$750||$1,000-$2,500||$2,500-$5,000|
|$5 million to $15 million||$75,000||$375-$938||$562-$1,125||$1,500-$3,750||$3,750-$7,500|
|More than $15 million||$100,000||$500-$1,250||$750-$1,500||$2,000-$5,000||$5,000-$10,000|
Can I get bonded with bad credit?
Yes, with Lance Surety Bonds' Bad Credit Surety Bonds program you can get bonded even if your finances are not stellar. It is designed for applicants facing low credit scores, tax liens, bankruptcies, and civil judgments.
As the risk is higher, the rates you can expect range between 5% to 10%. As we work with a number A-rated, T-listed surety companies, you can still count on a top bonding option from us.
What is the bonding process like?
To get started with your bonding, you can fill out our online application form (it takes 5min). We are able to issue an exact quote for you once you submit a full set of documents. You can then buy your bond online and will receive a digital and a paper version.
Would you like to delve into the details of the bonding process? Make sure you consult our extensive How to Get Bonded page.
To speak with our bonding experts, you can call us at (877) 514-5146.
How are bond claims handled for mortgage brokers?
Your Vermont mortgage broker bond doesn't protect your business, but rather your customers. Thus, if you transgress from your legal obligations, they can file a claim against the bond. The compensation that can be sought is up to the bond amount that you provided.
If the case is proven, you are liable to pay the reimbursement to the harmed parties. At first, your surety may cover it. However, the costs remain your responsibility, as this is set in the bond indemnity. Thus, bond claims are to be avoided, since they can harm your business and prevent you from getting bonded 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!