Escrow Officers Schedule Bond - Statewide in Texas

Brief Summary

One Escrow Officers Schedule Bond, written on TDI form FINT123, covers the escrow officers your Texas title agency or direct operation appoints. The bond is issued in the agency's name, not the officer's, and the amount follows a simple statutory formula capped at $50,000, so you can size it correctly before the first appointment is filed.

Texas requires each title insurance agent and direct operation to bond its appointed escrow officers under Insurance Code 2652.101. The bond is payable to the Texas Department of Insurance and equals $5,000 for each escrow officer who is a bona fide Texas resident and $10,000 for each officer who is a bona fide resident of an adjacent state, up to a maximum of $50,000 under Section 2652.103. The agency buys the bond, not the individual officer.

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How to Apply for a Escrow Officers Schedule Bond:

• Count the escrow officers the agency employs and note whether each is a bona fide resident of Texas or of an adjacent state.
• Calculate the amount at $5,000 per Texas resident officer and $10,000 per adjacent state resident officer, up to $50,000.
• Provide the agency's legal name and TDI license details for the principal line, plus the name of each escrow officer for the schedule.
• Complete the bond application and review the quoted premium.
• Receive the executed FINT123 bond with the schedule of escrow officers attached.
• File each escrow officer appointment with TDI on form FINT09 or electronically, acknowledging that the officer is covered by the bond.

Detailed Information About the Texas Escrow Officers Schedule Bond:

The agency buys this bond, not the escrow officer

Newly licensed escrow officers often go looking for a personal bond. Texas Insurance Code 2652.101 puts the duty on the title insurance agent or direct operation, which must obtain the bond at its own expense for the escrow officers it appoints. The bond is payable to the Texas Department of Insurance and covers pecuniary loss the agency suffers through fraud, dishonesty, forgery, theft, embezzlement or wilful misapplication by an escrow officer. It must be a type approved by TDI and issued by a surety licensed by TDI to do business in Texas.

How the amount is calculated

Section 2652.103 sets the amount by headcount. Multiply the number of escrow officers the agency employs by $5,000 for each officer who is a bona fide resident of Texas, or by $10,000 for each officer who is a bona fide resident of a state adjacent to Texas. The required amount never exceeds $50,000. An agency with ten Texas resident escrow officers reaches the cap, and adding officers after that does not raise the requirement.

The schedule form

TDI publishes the Texas Escrow Officers Schedule Bond as form FINT123. The title insurance agent or direct operation is the principal, TDI is the obligee, and the escrow officers are listed on a schedule attached to the bond. The form sets a penal sum for each escrow officer on the schedule. The surety may end its liability for any or all listed officers by giving 30 days written notice to the agency and to TDI.

Appointments depend on the bond

Under Section 2652.001, an individual may not act as an escrow officer in Texas without a TDI license, coverage under this bond or a deposit, and an appointment by a title insurance agent or direct operation under Section 2652.1511. The appointment form, FINT09, asks which security covers the officer (surety bond, letter of credit or cash deposit) and the amount. Unless TDI says otherwise, the officer may start acting for the agency after the second business day following an electronic appointment or the eighth business day following a paper appointment.

Alternatives and attorneys

Instead of the bond, Section 2652.102 lets the agency deposit cash, irrevocable letters of credit issued by a federally insured financial institution, or securities approved by TDI. Section 2652.003 does not require an attorney to hold an escrow officer license to perform escrow duties, but a title insurance company or agent may not let an attorney conduct business under its name unless the attorney and the attorney's employees who close transactions are licensed escrow officers.

Eligibility and Requirements for a Texas Escrow Officers Schedule Bond:

• Principal is the title insurance agent or direct operation, not the individual escrow officer.
• Texas Department of Insurance named as obligee.
• Written on TDI form FINT123, Texas Escrow Officers Schedule Bond.
• Surety licensed by TDI to do business in Texas.
• Bond amount set by Insurance Code 2652.103, with a $50,000 maximum.
• Name and address of every appointed escrow officer certified to TDI by the agency's license expiration date under Section 2652.151.

Texas Escrow Officers Schedule Bond FAQs:

Official and Additional Resources for the Texas Escrow Officers Schedule Bond: