Nebraska Mortgage Banker Bond

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Who is Required To Purchase a Nebraska Mortgage Banker/Broker Bond?

The Nebraska Department of Banking and Finance requires this surety bond for mortgage banker companies and banker registrations. These companies are responsible for:

• First mortgage brokering
• Second mortgage brokering
• First mortgage lending
• Second mortgage lending
• Servicing of first and second mortgage loans
• Loan purchasing
• Short sales
• High cost home loans
• Third party mortgage activities
• Among many other related services

Just to recap the major mortgage services:

• A mortgage originator, or mortgage broker, is responsible for helping consumers find the best mortgage product to meet their qualifications and financing requirements
• A mortgage lender is the company that provides the money for the actual loan
• A mortgage servicer is the company that manages the day to day and month to month activities like collecting payments, loan accounting, managing late payments, etc...

Nebraska, like most states, does not require individual mortgage brokers to purchase a surety bond. They are covered by the company bond.

However, if you're a sole proprietor or sole owner of a business entity, you will be required to purchase the appropriate surety bond amount for your business.

Why is a Nebraska Mortgage Banker Bond Required?

Licensing guidelines exist to ensure only serious and qualified applicants can legally conduct business in the state of Nebraska. It's up to the Nebraska Department of Banking and Finance to supply and enforce these guidelines.

Even though the Department intends to only license reputable companies, every year there will be a handful of mortgage companies that commit mortgage fraud to make more money:

Examples of these fraudulent actions include:

• Approving a borrower for a loan they can't afford
• Helping a borrower get approved for a loan by providing false information
• Hindering a borrower from getting approved by providing false information
• Pressing a borrower to enter a high commission loan to make more money
• Creating and charge fabricated fees

And this is where the surety bond comes in. If a customer falls victim to any of these acts, or similar actions, they can make a claim against the mortgage company's surety bond for financial compensation.

The amount of total available compensation extends to the amount of the surety bond. And this is why the bond amount is so important.

What Are The Nebraska Mortgage Banker/Broker Bond Amounts?

The bond amount is based on the total dollar amount of the closed residential mortgage loans originated in the state from the preceding calendar year.

In the Nebraska law outlining the bonding requirement for mortgage bankers, there is a possible additional surety bond requirement.

If the director of the department determines a company has exhausted its current bond level or the current bond is inadequate, the director can/may require a supplemental bond during the calendar year.

This supplemental bond amount will be told to you, but it can't exceed $1,00,000.

How Much Does a Nebraska Mortgage Banker Bond Cost?

The price of the mortgage banker/broker surety bond is going to depend on a rate quoted from a surety and your specific bond amount.

A surety is an insurance company that underwrites mortgage banker bonds.

Every surety conducts their own independent analysis of an applicant, but the main factors that will determine the price of your bond are:

• Personal credit of the business owner or owners
• Mortgage and financial lending experience
• Prior bond claims if the individual or owner has been licensed in the past

Based on these factors the surety will quote a rate.

This is where a specialized surety agency can help ensure you pay the smallest price to purchase your bond.

Here's how we help you save money:

• We price shop for you with our network of A rated sureties
• Find the lowest possible price
• Help you purchase your surety bond
• And get it issued and submitted

It costs you nothing to have us price shop for you. Once you get your pricing, you're under no obligation to purchase. Pricing is free information you can use to help get through the licensing process faster.

There's no reason to request your free quote right now or call a bond specialist at 1-800-608-9950.

Nebraska Mortgage Banker Bond Price Example

Let's look at the $150,000 bond amount for mortgage brokers.

Pay attention to the rates and how one percentage point can make huge difference in the price, saving you hundreds of dollars.

You can see a lower rate by only one percentage point can make a huge difference.

Example pricing is great, you can get your exact price with no risk or obligation to purchase within one business day.

Go request your price quote today. Remember, this is free information for you. There's no obligation to purchase. Quotes are good for 30 days.

How To File Your Mortgage Broker or Lender Bond?

After you agree to a price, purchasing your bond is as easy as completing an online checkout form.

Once your payment is processed, our issuance team will immediately begin the process to issue your bond with the National Multi-State Licensing System (NMLS).

The Nebraska Department of Banking and Finance does not issue any paper license or surety bond. The entire process is managed through the NMLS.

We provide you with detailed instructions to help us file your bond. The process takes only a few minutes.

How Long Does a Nebraska Mortgage Banker Bond Last?

The Nebraska mortgage banker/broker bond term is 12 months from the active date or effective date..

You choose the effective date when you purchase your mortgage surety bond.

Before each 12 month term, you must renew your bond to keep it active and on file with the NMLS.

Renewing a Nebraska Mortgage Banker/Broker Bond?

Renewing a mortgage broker and lender bond is easy. As your bond expiration date approaches, your bond specialist will contact you 30 to 45 days in advance to ensure you don't miss paying the renewal premium.

Your bond specialist will have renewal pricing already quoted making renewing your bond an easy process.

Once you pay the renewal premium, your bond remains active in the NMLS. You don't have to file or re-file any additional paperwork.

Mortgage Banker Bonds And Getting Your Nebraska Business License/Registration

Here's a brief breakdown of each step.

Step 1: Complete the Background Check

Each owner will have to submit a set of fingerprints for a background check conducted through the NMLS.

Step 2: NMLS Registration

You will need to create an account and profile with the NMLS. This is where you will upload all of your application paperwork including e-filing the surety bond.

Step 3: Identify the Registered Agent

The registered agent is the individual who is responsible for the mortgage broker employees. They are typically the individual responsible for passing the necessary exams and proving experience for licensure.

Step 4: Outline Business Setup and Organization

You will need to provide copies of your business formation documents. This applies to every type of business formation including:

• Sole proprietor
• General partnership
• Limited liability company
• Corporations
• Plus the variety of others

Along with the business formation documents, you must include any registered trade name. Nebraska only allows one trade name per license.

If you want to have more than one trade name, you will have to go through the licensing process for each name.

Step 5: List Contact Employees

Nebraska requires the individuals with the following responsibilities to be listed as the primary contact for that area:

• Accounting
• Exam billing
• Licensing
• Consumer complaints on the public side
• Consumer complaints on the regulator side
• Exam delivery
• Litigation
• Legal
• Pre-exam

Again the entire licensing process is conducted and managed through the NMLS.