Arizona Mortgage Broker Bond

Arizona Mortgage Broker Bond

The Arizona Department of Financial Institutions (AZDFI) mandates all mortgage brokers hold an active license in order to operate in the state. The license requires a Mortgage Broker Bond which Jet Insurance Company provides. The bond is a financial guarantee from Jet to the AZDFI allowing broker licensing by protecting the public in the event they are financially injured by the fraudulent actions of a mortgage broker. All licensing and other paperwork is done electronically through the Nationwide Multistate Licensing System (NMLS).

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Jet is unique in the sense that we allow direct access to the surety carrier for your bond without the need for middlemen brokers slowing down the approval process.

What Is the Lowest Price for the Bond?

Jet Insurance Company offers the Residential Mortgage Broker Bond and Commercial Mortgage Broker Bond starting at $100 per year or $10 per month. Rates can vary based on the personal credit of the applying officer of the mortgage brokerage. Below are the preferred rates available at Jet.

Bond TermCost
Monthly$10
1 Year$100
2 Years$175
3 Years$250
Arizona Mortgage Broker Bond Pricing

With Jet, two and three year payment plans are also available. Rates start at $175 and $250, respectively.

Mortgage Broker Bonds are either for a $10,000 or $15,000 bond limit. Brokers self report which bond limit they need to have with the AZDFI. If the broker's investors are solely institutional investors the limit is $10,000, otherwise $15,000. With Jet the price starts at $100 a year for either limit.

What Is the Purpose of the Mortgage Broker Bond?

The Arizona State Legislature enacted laws that require a mortgage broker license and regulate the operation of any broker in the state. The Arizona Department of Financial Institutions enforces the statutes surrounding mortgage brokerage license protocol, which ultimately promotes the security and safety of the Arizona financial services industry.

A mortgage broker has the opportunity to pursue their own self interest for financial gain through fraudulent and unlawful activities at the expense of their clients. The Mortgage Broker Bond provides a financial recourse to the damaged party. The bond is a tool used by the State of Arizona to protect the public from financial injury using a surety company (Jet) to promise repayment.

It is our goal as a surety to provide that financial protection while giving you the broker for the lowest possible rate for this mandated coverage.

How Does the Application Process Work With Jet?

Jet’s online application is effortless. The only information we need is basic business information and a social security number. A soft credit check will take place to review credit score and history. It will only take seconds and won’t affect your credit score at all.

The bond will be available for immediate purchase once you are done with the online application. A digital copy of the bond and receipt will be available moments after purchase.

Can Jet File the Mortgage Broker Bond for Me?

Yes, Jet will electronically file the bond. Once purchased a digital copy of the original bond will be sent to the NMLS for you. A copy through email will also be sent directly to you by Jet. To avoid confusion, Jet has provided a guideline of how the NMLS bond filing process is conducted.

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The process remains identical for new applicants and licensed brokers seeking to update their current bond terms. Simply grant Jet access to your NMLS account, so we can take care of any filing, cancellation, reinstatement, or renewals that you may require.

Any other paperwork outside of bond and application filings can be sent to the following address:

Arizona Department of Financial Institutions
100 N 15th Ave, Suite 261
Phoenix, AZ 85007

Can the Bond Be Cancelled?

Cancellation of the Mortgage Broker Bond can be achieved via mail or email to Jet. Jet will submit cancellation to the NMLS right away, but know that the bond will stay active for a 30-day cancellation period. 

Jet will calculate and refund unearned premium from the cancelled bond. We do have to factor in the 30-day cancellation period as the bond is active during that time.

For those on our monthly payment plan we will need to wait 30 days before the auto-withdrawal ends from the time we receive the cancellation notice from you.

How Do I Renew the Mortgage Broker Bond?

No renewal is required if you are participating in Jet’s monthly payment plan! As long as automatic payments continue, the bond will remain active. 

For annual payment plans, Jet will notify you regarding the renewal of your bond through email and mail. Jet does not require any additional paperwork to renew your bond; only payment. After renewing, the NMLS will be notified, and a copy of the bond plus receipt of purchase will be sent right to you.

How Does a Principal Avoid Bond Claims?

Mortgage brokers should be well aware of the laws and duties they must follow before conducting any business in Arizona. A close inspection of the Secure and Fair Enforcement for Mortgage Licensing Act of 2008 (S.A.F.E.) should be conducted. Additionally, a review of Arizona Statutes ARS 6-909 should also be completed. To prevent confusion, Jet has summarized key statutes below:

Violations and means for bond claim includeLawful duties include
Collecting illegal fees unbeknownst to the debtorFollowing bonding requirements to prevent licensure being in jeopardy of revocation
Breaching contract by releasing sensitive information such as an address of the debtorEstablishing a written contract between the debtor and lender which is agreed and signed prior to any lending activities
Failing to upkeep accurate and current accounting recordsAccepting cash and only cash as payment for a mortgage
Failing to abide by Securities and Exchange Commission principles when conducting accounting practicesHolding easily accessible accounting records for the superintendent of the AZDFI in case of investigation
Providing funding for anything other than a mortgage or commercial mortgage loanHiring escrow agents that are registered with the securities and exchange commission
Arizona Mortgage Broker Duties & Complaints

All complaints of financially injured clients must go through the AZDFI’s complaint portal. Once completed, the AZDFI will conduct their own investigation. Should the mortgage broker be in violation of licensure, disciplinary action would be inflicted by the AZDFI. This may include fines, license suspension, license revocation and/or a claim on the surety bond.

What Happens if I Get a Bond Claim?

Bond claim paperwork should be sent to Jet immediately. Include any other relevant information pertaining to your case, and we will conduct an investigation on your behalf. Jet will defend our clients against faulty claims.

If your bond claim is valid, Jet will repay those damaged up to the maximum bond limit. Despite funds being settled, the mortgage broker is still liable for their fraudulent actions and must pay the surety company for claim damages. As a surety bond company, Jet acts as an intermediary to send funds to damaged parties, but the debt still needs to be repaid by the mortgage broker.

Are There Other Bonds That a Principal Needs?

Yes. If the mortgage broker is dealing with commercial mortgage clients, a Commercial Mortgage Broker bond will need to be obtained as opposed to a standard Mortgage Broker bond.

If you are in need of further details on the mortgage industry, licensure processes in multiple states, and applicable surety bond regulations, take a look at Jet’s comprehensive Mortgage License Bonds Guide.

Arizona Mortgage Broker Bond Form

Notary Bond Application:

X

Business Information:

Indemnity Agreement:

I, the undersigned, hereby apply for a Dishonesty Bond also known as a Business Service Bond or Janitorial Service Bond (“bond”) to the Surety Company (“SURETY”) through Jet Insurance Company (“JET”), with whom I hereby grant the authority to act on my behalf with respect to the bond and assign as my Broker of Record, and declare that the statements herein are true and correct. In consideration of the SURETY issuing, renewing or substituting said bond(s), I, individually and as the owner or officer of the bonded entity, hereby understand and agree, as follows: (i) to reimburse, hold harmless, and indemnify SURETY upon demand for all loss, liability, claim, expense, including but not limited to attorneys’ fees, expert’s fees, investigative fees and claims handling fees, and any other cost which SURETY shall pay or incur in defense, adjustment, or settlement of such claims/suits by reason of such suretyship; (ii) that an itemized statement of loss and expenses by SURETY shall be indisputable proof of my liability to SURETY; (iii) coverage is subject to a $100 deductible; (iv) the employee must be convicted before coverage will apply (v) performance and any form of dispute resolution of this agreement shall take place in the county of SURETY's office of service; and (vi) a facsimile copy or electronically signed version of this agreement shall be binding as if it were an original. This agreement shall survive any changes in, substitute to or renewal of the bond(s).

Required Effect Date of Bond Policy:

Contact Information:

Employee Dishonesty Bond Application:

Business Information:

Business Description:

Coverage Requirements:

Indemnity Agreement:

I, the undersigned, hereby apply for a Dishonesty Bond also known as a Business Service Bond or Janitorial Service Bond (“bond”) to the Surety Company (“SURETY”) through Jet Insurance Company (“JET”), with whom I hereby grant the authority to act on my behalf with respect to the bond and assign as my Broker of Record, and declare that the statements herein are true and correct. In consideration of the SURETY issuing, renewing or substituting said bond(s), I, individually and as the owner or officer of the bonded entity, hereby understand and agree, as follows: (i) to reimburse, hold harmless, and indemnify SURETY upon demand for all loss, liability, claim, expense, including but not limited to attorneys’ fees, expert’s fees, investigative fees and claims handling fees, and any other cost which SURETY shall pay or incur in defense, adjustment, or settlement of such claims/suits by reason of such suretyship; (ii) that an itemized statement of loss and expenses by SURETY shall be indisputable proof of my liability to SURETY; (iii) coverage is subject to a $100 deductible; (iv) the employee must be convicted before coverage will apply (v) performance and any form of dispute resolution of this agreement shall take place in the county of SURETY's office of service; and (vi) a facsimile copy or electronically signed version of this agreement shall be binding as if it were an original. This agreement shall survive any changes in, substitute to or renewal of the bond(s).

Required Effect Date of Bond Policy:

Contact Information:

Contract Bond Application:

X

Business Information:

Owner Information:

Job Details:

Indemnity Agreement:

I, the undersigned, hereby apply for a Dishonesty Bond also known as a Business Service Bond or Janitorial Service Bond (“bond”) to the Surety Company (“SURETY”) through Jet Insurance Company (“JET”), with whom I hereby grant the authority to act on my behalf with respect to the bond and assign as my Broker of Record, and declare that the statements herein are true and correct. In consideration of the SURETY issuing, renewing or substituting said bond(s), I, individually and as the owner or officer of the bonded entity, hereby understand and agree, as follows: (i) to reimburse, hold harmless, and indemnify SURETY upon demand for all loss, liability, claim, expense, including but not limited to attorneys’ fees, expert’s fees, investigative fees and claims handling fees, and any other cost which SURETY shall pay or incur in defense, adjustment, or settlement of such claims/suits by reason of such suretyship; (ii) that an itemized statement of loss and expenses by SURETY shall be indisputable proof of my liability to SURETY; (iii) coverage is subject to a $100 deductible; (iv) the employee must be convicted before coverage will apply (v) performance and any form of dispute resolution of this agreement shall take place in the county of SURETY's office of service; and (vi) a facsimile copy or electronically signed version of this agreement shall be binding as if it were an original. This agreement shall survive any changes in, substitute to or renewal of the bond(s).

Required Effect Date of Bond Policy:

Contact Information:

Worker's Compensation Application:

X

Business Information:

Business Description:

Coverage Requirements

Indemnity Agreement:

I, the undersigned, hereby apply for a Dishonesty Bond also known as a Business Service Bond or Janitorial Service Bond (“bond”) to the Surety Company (“SURETY”) through Jet Insurance Company (“JET”), with whom I hereby grant the authority to act on my behalf with respect to the bond and assign as my Broker of Record, and declare that the statements herein are true and correct. In consideration of the SURETY issuing, renewing or substituting said bond(s), I, individually and as the owner or officer of the bonded entity, hereby understand and agree, as follows: (i) to reimburse, hold harmless, and indemnify SURETY upon demand for all loss, liability, claim, expense, including but not limited to attorneys’ fees, expert’s fees, investigative fees and claims handling fees, and any other cost which SURETY shall pay or incur in defense, adjustment, or settlement of such claims/suits by reason of such suretyship; (ii) that an itemized statement of loss and expenses by SURETY shall be indisputable proof of my liability to SURETY; (iii) coverage is subject to a $100 deductible; (iv) the employee must be convicted before coverage will apply (v) performance and any form of dispute resolution of this agreement shall take place in the county of SURETY's office of service; and (vi) a facsimile copy or electronically signed version of this agreement shall be binding as if it were an original. This agreement shall survive any changes in, substitute to or renewal of the bond(s).

Required Effect Date of Bond Policy:

Contact Information: