Effective August 1, 2017, Maryland becomes the latest in a continuously growing list of states adopting the requirement that NMLS surety bonds be uploaded to the system electronically. Anyone submitting a surety bond for licensing in an industry regulated by the Nationwide Multistate Licensing System & Registry will need to ensure their surety bond is submitted electronically through NMLS if applying after the conversion date. Although many surety bond providers will upload the required documentation directly to NMLS once the bond has been purchased, it is important for principals to ensure they are uploading the bond themselves if the bond provider will not do so. Failure to upload the required documentation may lead to an application being rejected by the obligee, often resulting in the applicant having to restart the application process.
What Maryland NMLS surety bonds must be uploaded electronically?
Applicants for the following licenses are now required to submit their surety bonds electronically via the NMLS website:
- Collection agency licenses
- Consumer loan licenses
- Credit services business licenses
- Debt management licenses
- Installment loan licenses
- Money transmitter licenses
- Mortgage lender licenses
Information regarding the required bond amounts, as well as any further application materials may be found on the NMLS Maryland state licensing page.
How much does a surety bond cost?
The cost of a surety bond is determined by an underwriter—or underwriters—who will evaluate the applicant’s qualifications and determine an appropriate premium to be paid prior to the bond being issued. Factors that are frequently used to determine an applicant’s premium include information like credit score, previous experience in the industry, business and/or personal financials, etc.
The most highly qualified applicants are generally approved for as little as 1-3% of the total bond amount. However, the quote may be higher on bonds the surety company sees as inherently risky. Applicants without excellent credit or relevant experience may be required to pay slightly more to get a surety bond, though this premium may increase or decrease when the bond comes up for renewal. For example, an applicant who has poor credit and is approved at 6% of the bond amount may improve their credit throughout the term of the bond and pay a lower premium when the bond is renewed. Conversely, the bond premium may increase at renewal if their credit worsens.
Where can I get a surety bond?
Our team is ready to help you get the bond that you need. Give us a call at 1 (800) 308-4358 or click below for your free quote. We are ready to answer any questions you may have about getting NMLS surety bonds in Maryland.