Are mortgage brokers and mortgage lenders required to maintain surety bonds in Massachusetts?
Mortgage Lenders: The Division’s regulation 209 CMR 42.03(2)(a) requires mortgage lenders to maintain a bond in a sum to be based on the amount of the Applicant’s aggregate mortgage loans, as determined by the Commissioner, but in no event shall the sum of the bond be less than $100,000, up to a maximum of $500,000; provided that the sum of such bond may be increased by the Commissioner at any time to such amount up to the $500,000 maximum, as shall be shown to be necessary. The surety bond must contain a clause that the insurance company will notify the Commissioner at least 30 days prior to canceling the surety bond for any reason. The bond is required to be filed with the Treasurer and Receiver-General of the Commonwealth of Massachusetts. New mortgage lender license applicants are required to establish and maintain a bond of $100,000 at the time of initial application. Mortgage Brokers: The Division’s regulation 209 CMR 42.06(2)(a) requires mortgage brokers to maintain a bond of $7
