North Carolina Mortgage Lender and Broker Bonds

North Carolina Mortgage Lender Bond

The Mortgage Lender Bond and Mortgage Broker Bond are required by the Commissioner of Banks to ensure that mortgage lenders and brokers follow licensing regulations while managing residential mortgage loans in the State of North Carolina. These bonds are enforced to financially protect consumers from a mortgage lender or broker acting unlawfully.

VIEW YOUR BOND PRICE

The North Carolina Commissioner of Banks oversees regulation of mortgage lenders and brokers but utilizes the Nationwide Multistate Licensing System (NMLS) for all paperwork including licensing and bonding. Jet works with both regulatory agencies to get your bond on file efficiently.

How Much Does a Mortgage Lender or Mortgage Broker Bond Cost?

The cost for a Mortgage Broker Bond has a minimum bond limit of $75,000 and starts at $38 monthly or $375 annually. The Mortgage Lender Bond’s minimum amount is $150,000 and the cost starts at $75 monthly or $750 annually. Both bonds have a variable limit which depends on the amount of mortgage loans originated within a calendar year. Approved rates are contingent on the bond limit and underwriting. The chart below shows the starting rate, based on preferred credit, for each bond limit. 

Bond LimitMonthlyAnnual
$75,000$38$375
$125,000$63$625
$150,000$75$750
$250,000$125$1,250
$500,000$250$2,500
North Carolina Mortgage Lender & Broker Bond Pricing

With Jet’s exclusive monthly payment plan, you can break up the cost of the bond to make it affordable no matter what your required bond limit is. For payment up front, Jet offers one year or multi-year options. 

How to Determine the Bond Limit for Mortgage Business Bonds

Mortgage Bonds vary with the type of services provided. Lenders and brokers are both obligated to carry a bond that will cover the amount of mortgage loans originated within a calendar year. To find what bond limit you are required to carry, check the chart below for your bond type and the appropriate range of mortgage loans. If you are applying for a first time license, the Mortgage Broker Bond limit will be $75,000 and the Mortgage Lender Bond amount will be $150,000.

Amount in Originated Mortgage LoansMortgage Broker Bond LimitMortgage Lender Bond Limit
Up to $10,000,000$75,000$150,000
$10,000,001 – $49,999,999$125,000$250,000
$50,000,000 or more$250,000$500,000
North Carolina Mortgage Broker & Mortgage Lender Bond Limits

Mortgage loan originators that are employed by a mortgage lender or mortgage broker can be covered by the Mortgage Lender Bond or the Mortgage Broker Bond. The amount of mortgage loans made by an originator should be included with the mortgage broker’s or mortgage lender’s total originated residential loans amount to have appropriate coverage. 

Types of Mortgage Businesses in North Carolina

The Commissioner of Banks regulates licensing and bonding for multiple mortgage businesses, including mortgage brokers and lenders. Mortgage loan originators can be employed by a broker or lender.

Broker:

Lender:

Mortgage Loan Originator:

How Does the Mortgage Bond Get Filed?

After you purchase your Mortgage Lender Bond or Mortgage Broker Bond, the filing process can begin with the Nationwide Multistate Licensing System (NMLS). You must grant authority to Jet within the NMLS to be able to create and upload the bond. Once the bond is completed by you and Jet in the NMLS system, it is submitted to be filed. If changes need to be made at any time, Jet can issue riders to correct the bond as needed through the NMLS.

Can I Cancel My Mortgage Lender Bond or Mortgage Broker Bond and Get a Refund?

Yes! The Commissioner keeps the bond in effect for an additional 90 days after cancellation has been requested. Jet must charge you for those 90 days while the bond is still active. Jet will notify the Commissioner of the cancellation the same day that you request it.

Monthly payments would not be eligible for a refund, but would stop abruptly after the 90-day period. If you prepaid for an annual or multi-year term, yes, you can get a refund! Other companies hold on to commission rates and add on cancellation fees when you request cancellation. Jet only considers the time used on the bond (including the additional 90 days) versus the time that was unused and refunds the direct cost of the time left on the bond.

How Does a Mortgage Lender or Broker Avoid Bond Claims?

The Mortgage Lender Bond and the Mortgage Broker Bond are required by the Commissioner to ensure that mortgage lenders and brokers comply with their licensing requirements as listed in the North Carolina Secure and Fair Enforcement (S.A.F.E.) Mortgage Licensing Act (General Statutes Chapter 53, Article 19B). Claims on the bond can be filed by a consumer directly and by the Commissioner on behalf of a claimant. The best way to avoid claims on the bond is to conduct business lawfully, taking care to avoid prohibited acts, including but not limited to:

What Happens If I Get a Bond Claim?

If a claim gets filed against your Mortgage Lender Bond or Mortgage Broker Bond, Jet will start an investigation to find whether the claim is valid or not, giving both sides an opportunity to present their case. If the investigation rules in favor of the claimant, Jet will pay the amount of the claim up to the full limit of the bond and notify the Commissioner of the payout within 10 days. Because you are ultimately responsible for your actions, you must pay Jet back in the amount of the claim within 30 days to restore the full coverage of the bond. 

Claims can also be paid out automatically for any failure to make payment that becomes due for a violation of licensing rules and regulations. The Commissioner may instruct you to make payment to a consumer or you can agree to make payment through a consent agreement. Jet is obligated to pay the claim within 30 days of the due date as instructed by the Commissioner. Likewise, you are still obligated to pay Jet back for any claims paid out from the bond. 

Claims may be filed in one action or in successive claims by any consumers or the Commissioner. If a consumer and the Commissioner have both filed claims, the consumer has priority for receiving payment.

Why Are the Mortgage Lender Bond and Mortgage Broker Bond Required?

The Mortgage Lender Bond is a licensing requirement for a mortgage lender license and the Mortgage Broker Bond is a requirement for the mortgage broker license. These bonds help protect consumers from financial losses and enforce mortgage lenders and brokers to comply with the rules and regulations of the NC S.A.F.E. Act. The NC Commissioner of Banks is responsible for regulating mortgage lenders, brokers, and other mortgage businesses, as well as trust companies and state banks. The Commissioner monitors mortgage business licensing activity but partners with the Nationwide Multistate Licensing System for the filing of mortgage licenses and bonds.

How Does the Application Process Work With Jet? 

Applying for a Mortgage Lender Bond or a Mortgage Broker Bond is easy with Jet! Our online application will take you through each step to add in any necessary information, such as your name and social security number. Both bonds require full underwriting, which will include an evaluation by a Jet team member and may require additional information.

When the review is complete, an approved rate will be sent to you to purchase online instantly. Once you have purchased your Mortgage Lender or Broker Bond, Jet can begin the filing process with the NMLS.

PURCHASE MORTGAGE BROKER/LENDER BOND

How to Renew Mortgage Bonds in North Carolina

When it is time to renew your Mortgage Lender or Mortgage Broker Bond, Jet will send you notice through mail and email for your convenience. Renewing online only takes a minute to keep your bond in effect for another term. Filling out a mailed renewal notice is also quick, but takes a few days to be mailed to Jet.

If you are making monthly payments, you don’t need to worry about renewing your bond. Each payment that you make will keep your bond in effect for another month.

Do Mortgage Lender and Broker Bonds Expire?

No, the Mortgage Lender Bond does not have an expiration date and can be renewed as needed. Coverage from the bond will cease 90 days after cancellation is requested with the Commissioner of Banks.

Can a Mortgage Business Avoid the Bond Requirement?

Yes, under certain circumstances. The bond requirement may be waived by the Commissioner for any mortgage business who has demonstrated financial security and competent claims handling. As long as the mortgage lender or broker fulfills these requirements, business can be conducted without a Mortgage Lender Bond or Mortgage Broker Bond. However, the Commissioner has the authority to reinstate the bond requirement at any time if there is reason to believe that the standards listed below are no longer being met.

To waive the bond requirement, a mortgage lender or broker must satisfy all of the following:

Do North Carolina Mortgage Lenders and Brokers Need Any Other Bonds?

Yes, mortgage businesses may apply for authorization with the Commissioner to make reverse mortgage loans, per North Carolina G.S. Chapter 53, Article 21. Once authorized, a $100,000 Reverse Mortgage Lender Bond must be held to protect the borrowers of a reverse mortgage loan. Unlike the NMLS licensing and bonding for mortgage lenders, the Reverse Mortgage Lender Bond must be filed manually to the Commissioner as an original, paper bond.

North Carolina Mortgage Lender Bond Form

Notary Bond Application:

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:

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:

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: