What are Utah finance & mortgage broker bonds?
Finance and mortgage broker bonds are legally binding agreements between three parties:
- Finance professionals such as mortgage brokers and finance lenders
- A government agency like the Utah Department of Financial Institutions
- A surety company
The bonds provide a guarantee that licensed finance professionals conduct business in compliance with the regulations set forth in the Utah Code
If the finance professional fails to comply with the regulations, the surety company will pay out financial losses to damaged parties up to the full bond amount. The finance professional is liable to reimburse the surety for any damages paid under the bond.
How much do Utah finance & mortgage broker bonds cost?
The Utah Department of Financial Institutions classifies all mortgage brokers and mortgage lenders as mortgage loan originators. Mortgage loan originators are required to post a surety bond with a minimum bond amount of $12,500 as part of the licensing process. The bond requirements for other finance bonds in Utah are as follows:
- Utah Money Transmitter Bond: $50,000
- Utah Escrow Agency Bond: $10,000 and upwards
The surety company issuing the bond determines your premium rate, which is the percentage of the total bond amount you pay as the premium. Premium rates for Utah finance and mortgage broker bonds typically cost between 1% and 5% of the total bond amount.
During the application process, the surety company evaluates your personal credit, financial statements, industry experience, and licensing history. Applicants with good credit generally receive the lowest rates, however, bad credit will not prevent you from securing a Utah mortgage broker bond. EZSurety still offers competitive rates to individuals with low credit scores or other financial issues.
How to get your mortgage broker license in Utah?
To become a licensed mortgage loan originator in Utah, you must meet the following licensing requirements:
- Complete the criminal background check
- Submit your financial statements
- Provide a copy of your credit report
- Complete the pre-licensure education requirements
- Submit your application through the Nationwide Multistate Licensing System & Registry (NMLS)
- Pay $230 in licensing fees and a $36.25 background check fee
For information on obtaining other finance licenses in Utah, you can visit the NMLS Resource Center.