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The Colorado Division of Real Estate is responsible for mortgage loan originator licensing and compliance. Licensing rules and regulations are established under Colorado Revised Statutes 12-10. To comply with the regulations, mortgage loan originators must maintain a surety bond.
This surety bond is an agreement between three parties:
- Principal: The mortgage loan originators that needs to get the bond.
- Obligee: The entity requiring the principal to get bonded.
- Surety: The company that issues the bond.
A surety bond provides financial assurance that anyone who has experienced financial loss as a result of a mortgage loan originator’s violations of established regulations can be compensated fairly. When the surety receives a claim, it investigates the matter. If the surety concludes that the claim is valid, it compensates the claimant.
The principal is then required to fully reimburse the surety for the full amount paid to the claimant. Mortgage loan originators face significant financial effects as a result of a valid claim, so avoiding claims against the bond is in your interest.
How Much Does a Mortgage Loan Originator Bond Cost in Colorado?
The cost of a Colorado mortgage loan originator bond depends on the required bond amount. Individual originators must maintain a $25,000 surety bond, with costs ranging from $250 to $2,500. Companies with fewer than 20 licensed originators require a $100,000 bond, while those with 20 or more licensees must secure a $200,000 bond. Proof of continuous surety bond coverage must be maintained and kept current with the Division.
The cost of the bond falls between 1% and 10%. This is sometimes called the bond rate or the bond premium. Please use the chart below to estimate your bond cost before applying.
|
Colorado Mortgage Loan Originator Bond Cost by Credit Score |
|||
|
Surety Bond Amount |
700 or Higher |
600-699 |
599 or Below |
|
$25,000 |
$250 - $750 |
$750 - $1,250 |
$1,250 - $2,500 |
|
$100,000 |
$1,000 - $3,000 |
$3,000 - $5,000 |
$5,000 - $10,000 |
|
$200,000 |
$2,000 - $6,000 |
$6,000 - $10,000 |
$10,000 - $20,000 |
Sometimes, our customers ask how we decide how much a bond costs? To determine an applicant’s rate, we look at bond history, industry experience, credit scores and finances.
How to Get a Mortgage Loan originator Bond in Colorado
1. Apply For Your Bond
Obtaining a Colorado mortgage loan originator bond is a quick, three-step process. To get started, choose one of the two application methods available.
- Apply for a bond online – Access our online bond application 24/7. Our customers appreciate being able to complete this short form in only a few minutes.
- Call us at (888) 592-6631 – Our bond specialists are happy to speak with you and take your application by phone.
When applying, you will need:
- Bond name (Colorado Mortgage Loan Originator Bond)
- Bond amount ($25,000 or $200,000)
- Email and contact information
2. Get a Quote
We provide quick bond quotes to our customers via email. If you have questions or want to review your quote with us, we are happy to do so. Please reach out to us if you identify any areas that need to be revised.
3. Purchase Your Bond
When you are ready to finalize your purchase, make the invoice payment and sign the document online. We will then deliver the original bond to you by email.
Colorado Mortgage Loan Originator Bond Requirements
To apply for a Colorado mortgage broker license or a loan originator license, you must submit an electronic surety bond with your NMLS application. The Colorado Division of Real Estate oversees licensing and bonding requirements for mortgage brokers and loan originators.
To comply with state regulations, individual loan originators must provide a Colorado Mortgage Loan Originator Bond of $25,000, while companies with multiple licensees must secure a $100,000 bond (for fewer than 20 originators) or a $200,000 bond (for 20 or more originators).
If you have any questions regarding the required bond amount, the definition and role of mortgage loan originators or brokers in Colorado, etc., please contact us.
When one of our new customers contacted us recently, he needed clarification on the bond amount required for his growing office. We reviewed the state’s requirements with him, and he applied for his new bond with confidence. He enjoyed the personalized attention he received from us and how fast our process is.
How to Get Your Mortgage Loan Originator License in Colorado
The licensing process for a Colorado mortgage broker or a loan originator is completed through the Nationwide Mortgage License System. To apply, you must submit the following items:
- Application
- Surety bond
- Licensing Fee
- Company sponsorship for originators
- Credit report
- Employment history, for originators
- Criminal background check
- Secretary of State documentation, for the mortgage company
- Certificate of Authority or Good Standing, for the mortgage company
Sources
Nationwide Mortgage Licensing System. (n.d.). Checklist compiler.
https://mortgage.nationwidelicensingsystem.org/slr/SitePages/Checklist-Compiler.aspx
Colorado Division of Real Estate. (n.d.). Home. Colorado Division of Real Estate.
https://dre.colorado.gov/
Colorado Secretary of State. (n.d.). Rule [Title of the rule or regulation]. Colorado Secretary of State.
https://www.sos.state.co.us/CCR/GenerateRulePdf.do?ruleVersionId=2106
Casetext. (n.d.). Colorado Revised Statutes § 12-10-717. Bond required - rules. Casetext.
https://casetext.com/statute/colorado-revised-statutes/title-12-professions-and-occupations/division-of-real-estate/article-10-real-estate/part-7-mortgage-loan-originators/section-12-10-717-bond-required-rules