Mortgage Loan Originator Bond Utah Overview

To become an individual mortgage loan originator (i.e. a mortgage broker) in Utah, you need to get a license and a mortgage broker bond.

The amount an individual originator's bond must be either $12,500, $25,000, or $50,000, depending on the volume of loans they have originated.

While it is the DFI that regulates the business of mortgage loan originators in the state, individuals must use the Nationwide Multistate Licensing System & Registry (NMLS) to apply for their license.

Why do I need a bond?

The purpose of this bond is to act as a guarantee that the licensed loan originator will comply with all their legal obligations when conducting business.

If a licensee violates these and causes losses or damages to the state of Utah or consumers, they may file a claim against the bond to secure compensation.

If the claim is valid, the surety may extend compensation to claimants for as much as the full penal sum of the bond. In return, the bonded licensee must then reimburse the surety.

If this is the first time you're applying for a bond, see our detailed ‘What is a surety bond' guide!

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See the sections below for more information about the cost of this bond, what can give rise to a claim, and how to apply!

For any further questions about this bond, call our surety experts at (866)-450-3412!

How Much Does the Utah Mortgage Loan Originator Bond Cost?

Your surety bond premium, which is the cost you need to pay to get bonded, is equal to a fraction of the full amount of your bond. Your surety determines the rate at which you can get bonded based on a number of financial indicators.

How sureties determine the bond premium

Applicants' personal credit score is the most important factor considered by sureties. A high credit score is considered an indicator of financial health and stability, whereas a low score is seen as the opposite.

Respectively, applicants with a high to relatively high score can expect to get their mortgage loan originator bond at a rate between .5% and 5% of their total bond amount.

Applicants with a low score can instead expect a bond rate between 5% and 15%. This is so because sureties consider low credit as an indicator of a greater risk of a claim. For that reason, applicants with a low score must provide additional security in the form of a higher premium.

Sureties also take into account various other factors, such as:

  • Personal and business financial statements
  • Fixed and liquid assets
  • Industry experience and record

    You can get an idea of the range of your bond rate based on credit score from the table below!

Utah Mortgage Broker Bond Cost Based on Credit Score
Volume of yearly mortgage loan origination Bond Amount Credit Score
Above 700 650-699 600-649 Below 599
Up to $5 million $12,500 $100-$156 $100-$187 $250-$625 $625-$938
$5 to $15 million $25,000 $125-$312 $188-$375 $500-$1,250 $1,250-$1,875
Over $15 million $50,000 $250-$625 $375-$750 $1,000-$2,500 $2,500-$3,750

How Do Bond Claims Occur?

The purpose of the bond is to cover the activities and responsibilities of mortgage loan originators in Utah, as they are defined in the Mortgage Financing Regulation Act (Utah Code 70D).

If a licensed and bonded mortgage loan originator in the state violates the provisions of the Act and causes losses to consumers, these may file a claim against the originator's bond.

When a claim is filed, the surety that has issued the bond will investigate the claim to determine its validity and scope. If the claim is legitimate, the surety will proceed with issuing compensation to claimants. Compensation may be as high as the full amount of the bond.

Once the surety covers the claim, the claims process is not over! While claimants are compensated at this point, the surety never assumes liability for bond claims. This means that the mortgage loan originator who has violated the bond agreement must reimburse the surety.

This is a standard condition for bond agreements and it is also the reason why it is best not to give rise to claims. If there are no claims against a bond, the only cost assumed by the bonded party is the initial bond premium.

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If you have any further inquiries about the bonding requirements for mortgage loan originators in Utah, call us at (866)-450-3412!

Further Reading


About the author:
Todd Bryant
Todd Bryant is a graduate of Germantown Academy and the University of Pittsburgh College of Business Administration Honors College. He has been President of Bryant Surety Bonds, Inc., an A+ rated Business with the Better Business Bureau, since 2007. Licensed as a producer with the Department of Insurance, he has been published in the National Association of Surety Bond Producers newsletter and on numerous authoritative publications such as The Washington Post, Entrepreneur.com, Azcentral.com and many more.