On July 20, 2015, the Ohio legislature amended the Ohio Revised Code Chapter 1322, which included a revision to surety bond requirements for mortgage brokers and originators. Surety bond amounts are now calculated based on their loan volume rather than a fixed amount.
Previously, it was mandatory for Ohio mortgage brokers and originators to post a bond in an amount no less than $50,000. Each additional business location required another $10,000 bond as well. Now, regulations state that brokers, lenders and originators must post a bond that is equal to .5% of their loan origination volume. Broker and lender bonds cannot be less than $50,000 but also cannot exceed $150,000. Originator bonds cannot be less than $50,000 or greater than $100,000. $10,000 is still required per additional location.
In order for the principal to avoid possible legal conflicts after posting a mortgage loan originator or broker bond, he or she must remain in compliance with all provisions stated in the Ohio Mortgage Broker Act and the Truth in Lending Act. If damaging behavior occurs at the time of loan origination and a consumer is financially harmed as a result, he or she will not be held accountable for unnecessary or fraudulent charges. The principal is then required to reimburse the surety for all funds paid out in a timely manner.
All bonds must go through the National Mortgage Lending System. For more information, please refer to the sample bond form. This new requirement is effective immediately. Contact SuretyBonds.com with questions about getting bonded in Ohio.