RMLA Residential Mortgage Lending Act Letter of Exemption - NMLS Bond - Statewide in Ohio
Table of Contents
Brief Summary
A letter of exemption takes a credit union service organization or depository institution out of Ohio's registration requirement. It does not take its loan originators out of the bond requirement. Ohio lets the institution cover those originators under one bond instead of making each one buy a separate bond, and that single filing is usually the cleaner way to keep every originator active.
Mortgage loan originators who work for a credit union service organization or depository institution holding an Ohio letter of exemption must be covered by a corporate surety bond under Ohio Revised Code 1322.32. An individual originator's bond equals one half of one percent of the residential mortgage loans originated in the preceding calendar year, never less than $50,000 and never more than $100,000. The exempt institution may post the bond for its licensees instead. The bond runs to the Ohio Superintendent of Financial Institutions.
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How to Apply for a RMLA Residential Mortgage Lending Act Letter of Exemption - NMLS Bond:
- Confirm whether each originator will be covered by the institution's bond or needs an individual bond.
- Pull the aggregate dollar amount of residential mortgage loans originated in the immediately preceding calendar year.
- Calculate one half of one percent of that figure, then apply the $50,000 floor and $100,000 cap for an individual bond.
- Have the originator's legal name and home address exactly as listed in the NMLS account.
- Complete the bond application and pay the premium.
- File the bond with the Ohio Division of Financial Institutions and keep it in force for the full license period.
Detailed Information About the Ohio RMLA Residential Mortgage Lending Act Letter of Exemption - NMLS Bond:
The exemption is for the company, not the bond
Ohio's Residential Mortgage Lending Act lets a credit union service organization or a depository institution apply for a letter of exemption from registration under Ohio Revised Code 1322.05. The letter excuses the institution from holding a certificate of registration. Its mortgage loan originators still hold Ohio licenses, and under ORC 1322.32(A)(2) each of those licensees must be covered by a corporate surety bond.
How the amount is set
An originator who carries an individual bond posts one half of one percent of the aggregate loan amount of residential mortgage loans originated in the immediately preceding calendar year. The bond may not exceed $100,000 and may not be less than $50,000, so an originator with little or no prior year volume posts the $50,000 floor.
The institution can carry the bond instead
ORC 1322.05 lets the exempt organization or institution provide the surety bond for its licensees in the same manner as is permitted for registrants. Under Ohio Administrative Code 1301:8-7-14, one bond in the appropriate aggregate amount covers a qualified exempt entity regardless of how many exempted office locations it has, and an endorsement rider adjusts the amount when an office opens or closes. Originators covered by their employer's bond do not need an individual bond. Confirm the aggregate amount the Division of Financial Institutions expects for your institution before the bond is issued.
Fees and term
The letter of exemption application carries a nonrefundable fee of $350 for each office location. Letters expire every December 31 and renew with another $350 per location fee. The bond term should line up with the license period it covers.
Keeping the bond whole
If a claim payment reduces the penal sum, ORC 1322.32(C) requires a new or additional bond, or a reinstatement endorsement, to bring coverage back to the required total. Any lawsuit a buyer files alleging a violation, and any resulting judgment, must be reported to the superintendent by certified mail within ten days.
Eligibility and Requirements for an Ohio RMLA Residential Mortgage Lending Act Letter of Exemption - NMLS Bond:
- Corporate surety bond from a bonding or insurance company authorized to do business in Ohio.
- Obligee: Ohio Superintendent of Financial Institutions.
- Bond protects any buyer injured by a violation of ORC Chapter 1322.
- Individual bonds issued in the licensee's name with the home address shown in NMLS.
- Letter of exemption fee of $350 per office location, renewed by December 31 each year.
Ohio RMLA Residential Mortgage Lending Act Letter of Exemption - NMLS Bond FAQs:
No. The letter exempts the credit union service organization or depository institution from registration. ORC 1322.32(A)(2) still requires a bond for every licensee employed by or associated with the holder, either an individual bond or one provided by the institution.
One half of one percent of the residential mortgage loans the originator originated in the preceding calendar year, with a floor of $50,000 and a ceiling of $100,000.
Yes. ORC 1322.05 allows the institution to provide the surety bond for its licensees in the same manner as registrants, and OAC 1301:8-7-14 allows one bond in the aggregate amount regardless of the number of exempted offices. Originators covered that way do not need their own bonds.
Every December 31. The renewal goes in before that date with a nonrefundable $350 fee for each office location.
The penal sum is reduced by the payment, and ORC 1322.32(C) requires a new or additional bond or a reinstatement endorsement to bring it back to the required amount.
