Correspondent Residential Mortgage Lender ($150,000) - Individual or Partnership Bond - Statewide in New Jersey
Table of Contents
Brief Summary
When a sole proprietor or partnership applies for a New Jersey correspondent lender license, the $150,000 bond is written in the full names of the people behind the business, with any trade name added after them. Get the principal wording and the partner and witness signatures right and the bond can go in with the rest of the New Jersey application.
An individual or partnership seeking a New Jersey correspondent residential mortgage lender license files an original surety bond of at least $150,000 with the Department of Banking and Insurance. DOBI's form names the individual or the partners in full as principal, with any trade name added after the words "trading under the name of" or "doing business as". The bond runs to the State of New Jersey and steps up with closed loan volume under N.J.A.C. 3:15-3.1.
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How to Apply for a Correspondent Residential Mortgage Lender ($150,000) - Individual or Partnership Bond:
- Full legal name of the individual, or of each partner, exactly as filed in NMLS.
- Trade name, if any, written on the bond after "trading under the name of" or "doing business as".
- Certified copy of the Partnership Agreement, for a partnership.
- Filed Trade Name Certificate if the business uses a trading as name.
- Unqualified, audited financial statement showing at least $150,000 tangible net worth, dated within one year of filing.
- Original bond signed on the partner line and witnessed, sent to DOBI within 5 business days of the NMLS submission.
Detailed Information About the New Jersey Correspondent Residential Mortgage Lender ($150,000) - Individual or Partnership Bond:
Naming the principal
DOBI's bond form RMLABOND1118 handles individuals and partnerships differently from corporations. For an individual or a partnership, you insert the full name or names and, if a trade name is used, the words "trading under the name of" or "doing business as" followed by that name. DOBI also requires the name of the principal to match the applicant's full legal name exactly. Check the Correspondent Residential Mortgage Lender box on the form.
Signing as a sole proprietor or partnership
The form's signature section has a witness line for a sole proprietor or partnership and a separate line for a partner to sign. The seal and president lines are marked for corporations only. The surety signs through its attorney in fact. DOBI asks for an original, fully executed bond.
What the application asks of you
A partnership of any form submits a certified copy of its Partnership Agreement. A partnership or sole proprietorship using a trading as name submits its filed Trade Name Certificate, and any alternate name needs a file-stamped authorization from the N.J. Division of Revenue, with a limit of three trade names per license. At least one officer, director, partner, member, owner or principal must obtain a Qualified Individual Residential Mortgage Lender License and meet every requirement for mortgage loan originator licensing. Each control person completes an F.B.I. and New Jersey State Police background check. The applicant must show $150,000 in tangible net worth through an unqualified, audited financial statement prepared by a Certified Public Accountant or Public Accountant. The New Jersey specific items go to DOBI within 5 business days of the NMLS submission.
The amount grows with volume
The $150,000 bond covers the first $50,000,000 of closed loan volume. N.J.A.C. 3:15-3.1 requires an increase when an annual report shows higher volume, with proof to the Department within 30 days of submitting the report.
- Up to $50,000,000: $150,000
- $50,000,001 to $75,000,000: $200,000
- $75,000,001 to $100,000,000: $250,000
- $100,000,001 and over: $300,000
What makes a lender a correspondent
Under N.J.A.C. 3:15-1.2 a correspondent mortgage lender does not, in the regular course of business, hold mortgage loans in its portfolio or service them for more than 90 days, and has shown the Department it can fund mortgage loans through warehouse agreements, table funding agreements or otherwise.
Eligibility and Requirements for a New Jersey Correspondent Residential Mortgage Lender ($150,000) - Individual or Partnership Bond:
- Minimum bond of $150,000, rising to $200,000, $250,000 or $300,000 with closed loan volume.
- Surety company authorized to conduct business in New Jersey.
- DOBI form RMLABOND1118 with the Correspondent Residential Mortgage Lender box checked.
- Runs to the State of New Jersey for anyone injured by the licensee, its qualified individual licensees, loan originators, employees or agents.
- An officer, director, partner, member, owner or principal holding a Qualified Individual Residential Mortgage Lender License.
- At least 30 days notice to the Department before any cancellation takes effect.
New Jersey Correspondent Residential Mortgage Lender ($150,000) - Individual or Partnership Bond FAQs:
DOBI's form says to insert the full names for an individual or partnership, followed by "trading under the name of" or "doing business as" and the trade name if one is used. The principal name must match the applicant's full legal name exactly.
For a sole proprietor or partnership, the form has a partner signature line and a witness line. The seal and president lines are marked for corporations only, and the surety signs through its attorney in fact.
Yes. At least one officer, director, partner, member, owner or principal must obtain a Qualified Individual Residential Mortgage Lender License and meet all mortgage loan originator licensing requirements.
No. $150,000 covers the first $50,000,000 of closed loan volume. N.J.A.C. 3:15-3.1 raises it to $200,000, $250,000 or $300,000 as volume grows, with proof due within 30 days of submitting the annual report.
Under N.J.A.C. 3:15-1.2, a correspondent does not hold mortgage loans in portfolio or service them for more than 90 days in the regular course of business, and has shown it can fund loans through warehouse agreements, table funding agreements or otherwise.
Yes. N.J.S.A. 17:11C-63 requires a blanket bond covering the qualified individual licensees and all mortgage loan originators, other employees and agents of the business licensee.
