Oregon Mortgage Broker/Lender and Loan Servicer Bonds
What is an Oregon Mortgage Broker, Lender or Loan Servicer Bond?
A Mortgage Lender Surety Bond must be posted by those applying to the Oregon Department of Consumer and Business Services, Division of Finance and Corporate Securities (DFCS), for a license to operate as a mortgage broker or mortgage banker under ORS 86A.100 through 86A.992. The surety bond ensures that the principal, its agents and employees do not violate any provisions of state laws or fail to pay damages incurred by anyone as a result of the violations of state laws or other licensing provisions. The bond runs continuously through subsequent licensing periods until cancelled by the surety company through 30 days written notice to the Department of Consumer and Business Services, Division of Finance and Corporate Securities.
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Mortgage Bonds And Getting Your Oregon Business License/Registration
The state of Oregon defines Mortgage bankers as those who lend money to fund loans secured by interests in real estate and they sell or service the loans. Mortgage brokers sell real estate paper for themselves or for others or accept funds from others to invest in real estate paper. Mortgage brokers also make or negotiate mortgage loans. The mortgage lender license permits a company to act as a mortgage banker, mortgage broker or both.
Mortgage Lender Licensing Prerequisites and Requirements pursuant to Oregon Revised Statutes (ORS) Chapter 86A
1) A completed mortgage lender license application submitted through the Nationwide Mortgage Licensing System (NMLS) listing company's experience person, which must be either a full-time W-2 employee or owner with three years experience in mortgage lending within the last five years
2) Financial statements prepared in accordance with GAAP
3) Surety bond
4) Notice of a clients' trust account within financial institution physically located in Oregon
5) Registration with the Secretary of State Corporation Division of the primary company name and all assumed business names
6) Criminal records checks free of disqualifying convictions for each individual employed/to be employed as a loan originator
Surety Bonds Requirements
Oregon has instituted corporate/mortgage surety bond requirements based upon the company's dollar volume of Oregon loan originations. If the company is a new licensee in Oregon, a surety bond of $50,000 is required. As part of the renewal of the mortgage license, the amount of the surety bond will be calculated based on the dollar amount of Oregon residential mortgage loans listed in the mortgage call reports filed for the previous four quarters (Q3 + Q4 of the previous year plus Q1 + Q2 of the current year) using the following scale:
Less than $10 million - $50,000
At least $10 million but less than $25 million - $75,000
At least $25 million but less than $50 million - $100,000
At least $50 million but less than $100 million - $150,000
More than $100 million - $200,000