Overview of Indiana Credit Services Organization Bond Requirements
To obtain a credit services organization license or a foreclosure consultant license in Indiana, you must post a $25,000 foreclosure consultant bond.
You must file this bond with the Office of the Indiana Attorney General when applying to get licensed.
Why do I need this bond?
When you get bonded, you agree to comply with the provisions of the Indiana Code that govern how you should conduct business as a foreclosure consultant in the state.
If you violate these laws and cause losses to any person, they may take action against your bond to claim compensation for damages.
The surety that backs your bond must then investigate the issue and extend compensation to claimants, possibly for as much as the full amount of your bond.
Find out more about how bonds work from our ‘What is a surety bond' guide!
See the sections below to learn more about how much your bond will cost, what can give rise to a claim against it, and how to apply to get bonded!
If you need to consult with a bond specialist about how to apply or learn more about why you need a bond, call us at 866.450.3412!
How Much Does The Indiana Credit Services Organization Bond Cost?
The cost of your surety bond is equal to a fraction of its full amount. This percentage is determined by the surety company, based on applicants' financials.
Factors that influence your bond premium
The most important factor that sureties consider is your personal credit score.
Credit score is important because it is considered a reliable indicator of applicants' financial strength and the likelihood of a claim against the bond occurring. The higher an applicant's score - the lower that likelihood is thought to be.
Applicants with excellent credit scores of 700+ FICO are usually bonded at the lowest possible rates, somewhere between .75% and 1.5% of the total bond amount. Those applicants who have scores that range from good to moderate are usually offered a rate on their bond from 1.5% to 5%. Finally, applicants with low scores are usually offered a rate upward of 5% and up to 15%.
Along with your credit score, your surety will likely also want to review some of the following:
- Personal and business financial statements
- Fixed and liquid assets
- Work experience and record
For an estimate of your bond cost, based solely on your credit score, see the table below!
|Indiana Credit Services Organization Bond Cost Based on Credit Score|
|Above 700||650-699||600-649||Below 599|
|Indiana credit services organization / foreclosure consultant||$25,000||$188-$375||$250-$625||$625-$1,250||$1,250-$1,875|
How Do Bond Claims Occur?
Indiana Code 24-5-15-8 states that the bond required of foreclosure consultants and credit services organizations in the state is in favor of the state and for the benefit of any person who is damaged by a licensee's violation of the chapter.
For example, the chapter explicitly states the types of activities that may be considered deceptive. If a foreclosure consultant engages in such activities, causing losses to a person they provide services for, the latter may bring an action against the consultant's bond.
When a claim is filed against the bond, the surety that backs the bond must investigate the case and determine its validity. It must also determine the appropriate amount of compensation it might have to extend to the claimant.
Once claimants are compensated, this concludes the claims process for them. For the bonded foreclosure consultant, though, the process is not finished yet. To complete the process, the surety must be reimbursed in full by the consultant. This is a standard and central condition of every bond agreement.
To avoid all the complications that arise with a bond claim, your safest course of action is to comply with all legal requirements for your business.
How Can I Get Bonded?
To get a free and exact quote on your bond, click on the banner below and complete our simple bond form. We will then provide you with your quote, along with all additional details about the bonding process.
If you have any further questions about the bonding process or requirements for Indiana credit services organizations, call us at 866.450.3412 anytime!