South Dakota Mortgage Broker Bond Requirements
You need to post a mortgage broker bond to obtain a South Dakota mortgage broker license.
The licensing authority is the South Dakota Division of Banking at the Department of Labor and Regulation. It sets the criteria that you have to satisfy to launch your operations. The licensing procedure is handled by the Nationwide Mortgage Licensing System (NMLS).
Why Do I Need This Bond?
The surety bond is an indispensable requirement for getting licensed as a South Dakota mortgage broker. It works as a security mechanism that protects your clients. It ensures you will comply with Title 54-14 of the South Dakota Codified Laws, as well as any other applicable rules and regulations.
If your customers suffer damages due to any unlawful mortgage brokering activity on your part, they can seek fair compensation through a bond claim. The penal sum of your bond is the maximum reimbursement they can demand.
Want to learn more details about how bonding works? You can review our extensive ‘What is a surety bond’ guide.
Have questions about the bond requirement? Don’t hesitate to call our experts at 866.450.3412.
What Is the South Dakota Mortgage Broker Bond Cost?
To obtain a mortgage broker bond, you have to pay a premium. This is the actual surety bond cost. It is a percentage of the bond amount set by the Division of Banking.
The bond amount that you have to provide depends on your annual loan origination volume:
- Up to $25 million - $25,000
- Between $25 million and $100 million - $35,000
- More than $100 million - $50,000
Factors Determining Your Bond Premium
Your surety provider has to take into consideration several factors to set your bond cost.
Your credit score has the biggest importance among them. If you can showcase a FICO score of more than 700, your bond rate can be as low as 0.75%-1.5% of the required amount.
The other indicators that shape the bond cost for your South Dakota mortgage brokerage include:
- Personal and business finances
- Fixed and liquid assets
- Professional experience as a mortgage broker
In the table below, you can find out an estimate of your bond cost by credit score.
|Mortgage Broker Bond Cost By Credit Score In South Dakota|
|Annual volume of loans||Bond Amount||Bond Cost By Credit Score|
|Above 700||650-699||600-649||Below 599|
|Up to $25 million||$25,000||$188-$375||$250-$750||$375-$1,000||$750-$1,750|
|Between $25 million and $100 million||$35,000||$263-$525||$350-$1,050||$525-$1,400||$1,050-$2,450|
|More than $100 million||$50,000||$375-$750||$500-$1,500||$750-$2,000||$1,500-$3,500|
How to Apply For a Bond
If you’re ready to obtain your mortgage broker bond, you can click on the banner below. Complete the application form to get a free quote. Then you can buy your bond online with ease.
If you need more information about the South Dakota mortgage broker bond, you can contact us at 866.450.3412.