Montana’s Mortgage Act changes due to House Bill 107. [What mortgage servicers need to know.]

 How are mortgage servicers effected by Montana HB 107?

Montana legislature passed House Bill 107 (HB 107) on March 19, 2019. Modern mortgage servicer practices and advancements in technology caused these changes in legislature. Among these changes are new requirements for the surety bond, branch office management structure and advertising practices. Are you in compliance with these new changes?

Montana_Mortgage_Servicer_Legislature_ChangesAre you prepared for the Montana HB 107 legislature changes?

Does HB 107 change the required surety bond amount?

The required Montana mortgage servicer bond used to be a flat amount of $100,000. Under HB 107, the bond amount is now determined by calculating the mortgage servicer’s unpaid principal balance of residential mortgage loans as of December 31. The range of the Montana mortgage servicer bond is between $75,000 and $350,000.

  • An unpaid principal balance of $25 million or less a year requires a $75,000 bond.
  • An unpaid principal balance of more than $25 million, but not above $100 million a year requires a bond in the amount of $150,000.
  • A $250,000 bond is required for an unpaid principal balance of more than $100 million, but not above $500 million a year.
  • Finally, a $350,000 surety bond is required for an unpaid principal balance of more than $500 million a year.

Find out how much your Montana Mortgage Servicer Bond will cost.

The cost of the bond is largely dependent on the applicant’s credit. If approved, we at Surety Solutions, A Gallagher Company, issue these bonds around 1% of the bond face value. Having great credit can significantly reduce the cost of the bond. Don’t have the best credit? Don’t worry; We can help! Our team of surety bond experts will assist you in finding a market for your bond.

The designated manager and branch office requirements have been revised.

Thanks to advances in modern technology, working remotely is a more accepting practice. One can be assigned as a designated manager in the Nationwide Multistate Licensing System (NMLS) after they have completed 3 years of experience as a loan originator. Designated managers can now be responsible for more than one office location. They are responsible for conducting the mortgage origination for each office they manage.

“Life, and therefore, business is becoming more complex. As technology continues to race forward, we find that business is conducted, and thus regulated, differently today than it was even five years ago. Montana’s HB 107 is another piece of legislation updating regulations to match today’s complexity. Surety Solutions works proactively with clients to ensure their surety needs adjust to the ever-changing market demands.”

Corban Enns, Area Vice President
Surety Solutions, A Gallagher Company

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NMLS 2019: Conference Overview

The 11th Annual NMLS Conference, held in Orlando, FL had a strong showing with nearly 675 attendees, nearly identical to last year which was a record year for the conference. Out of the 54 States and US Territories, only New Jersey and US Virgin Islands didn’t register, once again showing strong industry participation. This year’s conference had a strong focus placed on the complexity of ongoing compliance and the development of the NMLS 2.0 System to aid and improve the system’s service while enhancing user engagement. In 2015, the CSBS had been tasked to redesign the NMLS 1.0 into a “low-code” platform, easing future development and providing long-term savings for system upkeep and future releases. While the RFP was released in 2015, it wasn’t until Q1 of 2017 that PricewaterhouseCoopers (PWC) was retained to gather the requirements of each user group to create improvements to workflows, functionality and future integrations.

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What Is A Mortgage Bond?

what is a mortgage bond

What is a Mortgage Bond?

A mortgage bond, in regards to surety, is a type of license and permit surety bond required by a state agency for licensure pertaining to mortgage activities. 

This is not to be confused with mortgage bonds that are also known as mortgage-backed security bonds.

There are a number of different types of mortgage bonds for surety which vary based on state statutes. 

Some states only have one license type and therefore only have a single bond. Other states have very detailed license types and, therefore, have multiple bonds.  The SAFE Mortgage Licensing Act of 2008 has created minimum standards that every state has adopted.

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Colorado Mortgage Loan Originator Bond

colorado mortgage loan originator bond 

A mortgage is a huge commitment for your clients, and they want to make sure that you’ll protect their interests. When you work in the mortgage industry, you need to hold a surety bond that shows your clients that you’re a responsible and ethical mortgage loan originator.

If you are a mortgage loan originator in Colorado, the type of surety bond you need is called a Colorado Mortgage Loan Originator Bond. This is different from a Colorado E&O (Errors and Omissions) policy.

Just looking on how to become licensed? How to Become a Loan Officer in Colorado

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Colorado E&O Insurance – What It Is & How Much It Costs

colorado e&o insurance

If you are trying to get your Colorado Mortgage Loan Originator License, you will need to get Colorado E&O insurance.

Every active mortgage loan originator licensee will need to secure an Errors and Omissions insurance policy.

Colorado E&O insurance is also appropriate coverage for anyone who gives advice or makes educated recommendations such as accountants, software developers, and real estate agents. 

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