Mortgage Broker Surety Bonds

What are Mortgage Broker Surety Bonds?

Mortgage Broker Bonds are a type of license and permit bond guarantees that the mortgage broker will comply with all state regulations and requirements for their industry.

It also ensures that all funds received from their clients are applied to the appropriate obligations, and that compensation is available for consumers that suffer financial harm due to fraud or fraudulent acts committed by the mortgage broker.

Who needs a Mortgage Broker Bond?

Mortgage Broker Surety Bonds are a requirement in most states for individuals and businesses performing the negotiation and execution of any mortgage-related tasks as a broker in direct relation to loans made by a mortgage lender.

Depending on where you are planning on doing business, this surety bond can go by many different names including Loan Originator Bond or Loan Broker Bond.

What parties are involved in Mortgage Broker Bonds?


The principal is the mortgage broker who purchases the bond in order to prove that the trustworthiness of the business. The principal takes financial responsibility for claims filed against the bond.


The obligee would be the clients of the mortgage broker and/or the state. This is who can make claims against the bond should the mortgage broker violates provisions of the bond. As long as those claims prove to be valid under investigation, the surety guarantees payment.


The surety is the underwriter that issues the bond to the mortgage broker. The surety agrees to pay any valid claims when the principal can’t or won’t. The surety does not accept the final financial responsibility. If and when a claim is settled, the principal pays the debt back in full including interest and fees.

How much do Mortgage Broker Surety Bonds cost?

Annual premium amounts for Mortgage Broker Surety Bonds vary and are based on a number of factors including:

  • The state requiring the bond
  • Penalty amount of the bond
  • Term Length
  • Personal credit of the applicant

Applicants with strong credit could pay 1% – 4% of the total bond amount. Applicants with less than stellar credit can expect to pay slightly higher rates of 5% – 7%. Pacific Surety offers industry low rates and can obtain approvals for almost all credit situations. Once our simple application has been completed, we can have pricing to you within hours. If you have any specific questions, please contact our knowledgeable underwriting staff.

Pacific Surety proudly offers Mortgage Broker Surety Bonds in the following states:

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