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The Connecticut Department of Banking is the authority for licensing compliance for mortgage brokers, lenders, correspondent lenders and servicers. The regulations for licensees are established under CGA Chapter 668. One of the licensing requirements is a surety bond.
This surety bond is an agreement between three parties:
- Principal: The mortgage broker, lender, correspondent lender or servicer that needs to get the bond.
- Obligee: The entity requiring the principal to get bonded.
- Surety: The company that issues the bond.
The purpose of the surety bond is to ensure that anyone who is financially impacted by the unethical behaviors of the licensee can be compensated fairly. When the surety receives a claim, it researches the matter and determines if it is valid. For a valid claim, the surety pays the claimant.
After a claim is paid by the surety, the principal is required to reimburse the surety. According to our customers, avoiding claims against the bond is easy to do when you abide by state regulations.
How Much Does a Mortgage Broker Bond Cost in Connecticut?
The cost of a Connecticut mortgage broker bond is between $500 - $15,000. The required bond amount ranges from $50,000 to $150,000.
A mortgage lender or correspondent lender in Connecticut is required to have a bond amount from $100,000 to $500,000. The cost ranges from $1,000 to $50,000.
Mortgage loan servicers need a $100,000 bond per office location. The cost of this bond ranges from $1,000 to $10,000.
The bond premium is between 1% and 10% of the total amount required. This is also sometimes called the cost of the bond or the bond rate. You can conveniently estimate your bond cost using this chart before applying.
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Connecticut Mortgage License Bond Cost by Credit Score |
|||
|
Surety Bond Amount |
700 or Higher |
600 - 699 |
599 or Below |
|
$50,000 |
$500 - $1,500 |
$1,500 - $2,500 |
$2,500 - $5,000 |
|
$100,000 |
$1,000 - $3,000 |
$3,000 - $5,000 |
$5,000 - $10,000 |
|
$150,000 |
$1,500 - $4,500 |
$4,500 - $7,500 |
$7,500 - $12,500 |
|
$500,000 |
$5,000 - $15,000 |
$15,000 - $25,000 |
$25,000 - $50,000 |
From time to time, our customers are curious about the factors that affect how much a bond costs. In addition to considering the applicant’s credit scores, we look at the applicant’s industry experience, bond history and finances.
How to Get a Mortgage License Bond in Connecticut
1. Apply For Your Bond
Obtaining a Connecticut mortgage broker bond, or a bond for a lender, correspondent lender or servicer is an easy, three-step process. To begin, apply for your bond using one of these two convenient methods.
- Apply for a bond online – Our customers appreciate being able to apply for their new bond online 24/7. Our short application usually only requires a few minutes of your time.
- Call us at (888) 592-6631 – Our bond specialists are standing by to answer your questions and assist with your application by phone.
When applying, you will need:
- Bond name (Mortgage Licensee Bond, Mortgage Correspondent Lender Surety Bond, Mortgage Lender Surety Bond, or Mortgage Servicer Bond Form for Lenders)
- Bond amount ($50,000 to $500,000)
- Email and contact information
2. Get a Quote
We provide immediate bond quotes to our customers by email. Our bond specialists are available to review the quote with you and answer your questions. Please let us know if you find any details that require a revision.
3. Purchase Your Bond
Our customers enjoy the convenience of reviewing the documents and paying their invoices online. Once these steps are completed, you will receive your original bond by email.
Connecticut Mortgage Broker, Lender, Correspondent Lender and Servicer Requirements
When applying for a Connecticut mortgage broker license or a license for a lender, correspondent lender or servicer, you must submit an electronic surety bond through the NMLS. The Connecticut Department of Banking is responsible for enforcing licensing and bond requirements, which range from $50,000 to $500,000, depending on origination volume.
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Mortgage Lenders and Mortgage Correspondent Lenders |
|
|
Dollar Amount of Origination Volume |
Required Surety Bond |
|
Less than $30 million |
$100,000 |
|
$30 million but less than $100 million |
$200,000 |
|
$100 million but less than $250 million |
$300,000 |
|
$250 million or more |
$500,000 |
|
Mortgage Brokers |
|
|
Dollar Amount of Origination Volume |
Required Surety Bond |
|
Less than $30 million |
$50,000 |
|
$30 million but less than $50 million |
$100,000 |
|
$50 million or more |
$150,000 |
The required bond forms include the Mortgage Licensee Bond, Mortgage Lender Surety Bond, Mortgage Correspondent Lender Surety Bond, or Mortgage Servicer Bond Form for Lenders.
These bonds remain in force until canceled by the surety. Thirty days prior to the cancellation date, the surety must provide the principal and the obligee with a written notice.
If you have any questions regarding required bond amount, the definition and role of mortgage brokers, lenders and servicers in Connecticut, etc., please contact us.
Recently, one of our new customers contacted us with a question about the mortgage lender bond requirements. She spoke with one of our friendly bond associates and quickly got the answers she needed. Then, she took advantage of the online application and soon had a bond quote delivered to her inbox.
How to Get Your Mortgage License in Connecticut
The licensing process for Connecticut mortgage brokers, lenders, correspondent lenders and servicers is completed via the Nationwide Mortgage License System. When applying for your license, the following items are required:
- Application
- Surety bond
- Financial statements
- Resident or registered agent
- Contact employees
- Qualifying individual
- Control person
- Credit report
- Criminal background check
- Formation documents
For lenders who provide servicing:
- Errors and omissions coverage
- Fidelity bond
For mortgage servicers:
- Board of directors for covered institutions
- Risk management program for covered institutions
Sources
Nationwide Mortgage Licensing System. (n.d.). Checklist compiler.
https://mortgage.nationwidelicensingsystem.org/slr/SitePages/Checklist-Compiler.aspx
Connecticut Department of Banking. (n.d.). Home [Website].
https://portal.ct.gov/dob
Connecticut General Assembly. (2021). Chapter 668: Banking law of Connecticut.
https://www.cga.ct.gov/2021/pub/chap_668.htm
Connecticut Department of Banking. (n.d.). Connecticut surety bond form [PDF]. Nationwide Multistate Licensing System & Registry.
https://mortgage.nationwidelicensingsystem.org/slr/StateForms/CT1-SURETY%20BOND.pdf
Nationwide Multistate Licensing System & Registry. (n.d.). Mortgage correspondent lender bond [PDF].
https://mortgage.nationwidelicensingsystem.org/slr/StateForms/Mortgage%20Correspondent%20Lender%20Bond.pdf
Nationwide Multistate Licensing System & Registry. (n.d.). Mortgage lender bond [PDF].
https://mortgage.nationwidelicensingsystem.org/slr/StateForms/Mortgage%20Lender%20Bond.pdf
Nationwide Multistate Licensing System & Registry. (n.d.). Mortgage servicer bond form for lenders [PDF].
https://mortgage.nationwidelicensingsystem.org/slr/StateForms/CT12-Mortgage%20Servicer%20Bond%20Form%20for%20Lenders.pdf