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The Minnesota Department of Commerce is the authority on residential mortgage originator and servicer licensing compliance. These requirements are defined in Minnesota Statutes Chapter 58. A bond is also required for accelerated mortgage payment providers in Minnesota, and this is established under Minnesota Statutes Section 332.30. A surety bond is required for these licenses.
This surety bond is an agreement between three parties:
- Principal: The mortgage originator, servicer or accelerated payment provider that needs to get the bond.
- Obligee: The entity requiring the principal to get bonded.
- Surety: The company that issues the bond.
The surety bond is an assurance that a person who experiences loss related to an originator’s, servicer’s or accelerated payment provider’s unethical actions will be fairly compensated. The surety is responsible for investigating claims. If it deems a claim valid, it compensates the claimant accordingly. The principal is then responsible for reimbursing the surety for the full amount of the claim.
Avoiding claims against the bond is accomplished by complying with the state’s regulations.
How Much Does a Mortgage License Bond Cost in Minnesota?
The cost of a Minnesota residential mortgage originator or servicer bond is between $1,250 and $30,000. Bond amounts range from $125,000 to $300,000, based on the total loan volume. The cost of an accelerated mortgage payment provider bond is between $1,000 and $10,000. The bond amount is $100,000.
The bond premium is usually between 1% and 10% of the bond amount. This is also often referred to as the cost of the bond or the bond rate. Estimate your bond cost with this chart before applying.
|
Minnesota Mortgage License Bond Cost by Credit Score |
||||
|
Surety Bond Name |
Surety Bond Amount |
700 or Higher |
600-699 |
599 or Below |
|
Residential Mortgage Originator Bond |
$150,000 |
$1,500 - $4,500 |
$4,500 - $7,500 |
$7,500 - $15,000 |
|
Mortgage Servicer Bond |
$150,000 |
$1,500 - $4,500 |
$4,500 - $7,500 |
$7,500 - $15,000 |
|
Accelerated Mortgage Payment Provider Bond |
$100,000 |
$1,000 - $3,000 |
$3,000 - $5,000 |
$5,000 - $10,000 |
Our customers often ask about the factors that influence how much a bond costs. In addition to the applicant’s credit scores, we review the applicant’s finances, bond history and industry experience.
How to Get a Mortgage License Bond in Minnesota
1. Apply For Your Bond
Obtaining a Minnesota residential mortgage originator, servicer or accelerated mortgage payment provider bond is a quick, three-step process. First, choose from our two easy application methods.
- Apply for a bond online – Our bond application is available online 24/7. Our customers appreciate being able to complete the form in a few minutes.
- Call us at (888) 592-6631 – As an alternative, you can speak with one of our friendly bond experts to apply by phone.
When applying, you will need:
- Bond name (Residential Mortgage Originator Bond, the Residential Mortgage Servicer Surety Bond or the Accelerated Mortgage Payment Provider Surety Bond)
- Bond amount ($100,000 to $300,000)
- Email and contact information
2. Get a Quote
Our customers receive bond quotes via email immediately, and they appreciate how accessible our specialists are when they have questions or need clarification. As you review your quote, please get in touch with us if you have revision requests.
3. Purchase Your Bond
After reviewing your bond documents, take a moment to sign them and make the payment online. After doing so, you will receive the original bond in your inbox.
Minnesota Mortgage License Bond Requirements
When applying for a Minnesota mortgage license, an electronic surety bond must be submitted through the NMLS. The Minnesota Department of Commerce oversees mortgage professionals' licensing.
Mortgage professionals must submit the appropriate bond form. The Residential Mortgage Originator Bond is required for those originating residential mortgage loans, with bond amounts ranging from $125,000 to $300,000 based on loan volume.
|
Dollar Amount of Closed Residential Mortgage Loans |
Surety Bond Required |
|---|---|
|
$0 to $10,000,000 |
$125,000 |
|
$10,000,001 to $25,000,000 |
$150,000 |
|
$25,000,001 to $100,000,000 |
$200,000 |
|
Over $100,000,000 |
$300,000 |
The Residential Mortgage Servicer Surety Bond is required for servicers managing loan payments and collections, with bond amounts from $125,000 to $300,000, determined by the unpaid principal balance of serviced loans from the previous quarter.
|
Dollar Amount of Unpaid Principal Balance for Serviced Residential Mortgage Loans |
Surety Bond Required |
|---|---|
|
$0 to $10,000,000 |
$125,000 |
|
$10,000,001 to $50,000,000 |
$200,000 |
|
Over $50,000,000 |
$300,000 |
The Accelerated Mortgage Payment Provider Surety Bond is required for businesses facilitating accelerated mortgage payments.
These are continuous bonds that remain in force until canceled by the surety. The surety is required to provide the obligee and the principal with a written notice 30 days in advance.
If you have any questions regarding the definition and role of mortgage originators, servicers or accelerated mortgage payment providers in Minnesota, the required bond amount, etc., please contact us.
Recently, a new customer reached out to one of our bond experts about the bond amount requirement for a mortgage originator. He was grateful for the one-on-one attention we provided and how thorough our answers were. With our quick application process, he also enjoyed a no-hassle setup process for his new bond.
How to Get Your Mortgage License in Minnesota
The licensing process for Minnesota residential mortgage originators, servicers and accelerated mortgage payment providers is completed via the Nationwide Mortgage License System. The following items are required when applying for a license:
- Application
- Surety bond
- Web addresses
- Resident or registered agent
- Indirect and direct owner/executive officers
- Business plan
- Certificate of Authority/Good Standing Certificate
- Formation documents
- Company staffing and internal policies
- Workers compensation insurance
- Document samples
- Management chart
- Organization chart
- Trust account authorization
- Commissioners criminal conviction consent application, if applicable
The following items are also required for servicers and accelerated mortgage payment providers:
- Bank account
- Qualifying individual
- Affirmation under oath
- BCA form
Sources
Nationwide Mortgage Licensing System. (n.d.). Checklist compiler. https://mortgage.nationwidelicensingsystem.org/slr/SitePages/Checklist-Compiler.aspx
Minnesota Department of Commerce. (n.d.). Minnesota Department of Commerce. https://mn.gov/commerce/
Minnesota Legislature. (n.d.). Chapter 58: Mortgage originators and servicers. Retrieved https://www.revisor.mn.gov/statutes/cite/58
Minnesota Department of Commerce. (n.d.). Residential mortgage originator license electronic surety bond form. https://mortgage.nationwidelicensingsystem.org/slr/StateForms/MN_Residential%20Mortgage%20Originator%20License%20ESB_v1.pdf
Minnesota Department of Commerce. (n.d.). Residential mortgage servicer license electronic surety bond form. https://mortgage.nationwidelicensingsystem.org/slr/StateForms/MN_Residential%20Mortgage%20Servicer%20License%20ESB_v1.pdf
Minnesota Department of Commerce. (n.d.). Accelerated mortgage payment provider license electronic surety bond form. https://mortgage.nationwidelicensingsystem.org/slr/StateForms/MN_Accelerated%20Mortgage%20Payment%20Provider%20License%20ESB_v1.pdf
Minnesota Legislature. (n.d.). Section 332.30: Accelerated mortgage payment providers. https://www.revisor.mn.gov/statutes/cite/332.30