Indiana Mortgage Broker Bond Requirements
To obtain a mortgage lending license or a loan broker license in the state of Indiana, applicants need to post a mortgage broker bond.
Applicants for a mortgage lending company license must post a $100,000 bond, whereas applicants for a loan broker company license must post a $60,000 loan broker bond.
These licenses are issued by separate government agencies. The Indiana Department of Financial Institutions regulates and issues licenses for mortgage lenders in the state. The Indiana Secretary of State Securities Division regulates and issues licenses for loan brokers.
In order to apply for any of these licenses, though, you must use the Nationwide Mortgage Licensing System (NMLS). To apply, you must register in the system and submit your application forms, supporting documents, and a mortgage broker bond.
Why Do I Need A Bond?
This bond guarantees that licensees will comply with the provisions of the Indiana Code, such as IC 23-2.5, and IC 24-4.4.
If a licensed and bonded mortgage broker violates the provisions of these chapters in the IC, causing losses to borrowers or mortgagees, a claim can be filed against their bond. The claim’s purpose is to secure compensation for such damages.
The surety that has issued the bond must then investigate the claim and compensate claimants up to, but no more than, the full amount of the surety bond.
Once a surety has compensated claimants, the bonded mortgage broker must reimburse the surety in full because they are liable for any violations of the bond’s conditions.
If you want to learn more about how surety bonds work, make sure to read our detailed guide ‘What is a surety bond’.
See the following sections for more information about the cost of the Indiana mortgage broker bond, and how to get bonded!
If you have any additional questions about the bonding requirements in the state of Indiana, call us at 866.450.3412 anytime!
How Much Does The Indiana Mortgage Broker Bond Cost?
To get bonded, you must pay a surety bond premium. The premium is equal to a percentage of the total bond amount.
The bond amount for mortgage lenders is $100,000, whereas loan brokers must post a $60,000 surety bond.
To determine the cost of your bond, sureties will typically request to review your financials. Here are the main factors that they take into consideration.
Factors That Determine Your Bond Premium
Your personal credit score is the most important indicator that sureties consider. A high credit score is understood to mean that you are less likely to give rise to a claim against your bond.
Applicants with high scores, such as 700 FICO and higher, are usually offered a rate between 0.75% and 1.5% of the total bond amount.
Applicants with low or very low scores are typically offered a rate upward of 3%.
On top of your credit score, sureties will usually also want to review some of the following information:
- Personal and business financial statements
- Fixed and liquid assets
- Work experience and record
Wondering how much your surety bond will cost? See the table below for a cost estimate, based on your credit score.
|Indiana Mortgage Broker Bond Cost By Credit Score|
|License Type||Bond Amount||Bond Cost By Credit Score|
|Above 700||650-699||600-649||Below 599|
|Mortgage lender license||$100,000||$750-$1,500||$1,000-$3,000||$1,500-$4,000||$3,000-$7,000|
|Loan broker license||$60,000||$450-$900||$600-$1,800||$900-$2,400||$1,800-$4,200|
How to Get a Mortgage Broker Bond in Indiana
Ready to apply for your bond? Click on the banner below to complete our quick bond form. We will then provide you with a free quote on your bond, along with further information about the bonding process.
If you have any additional questions about getting this type of bond, you can always call us at 866.450.3412 for more information!