Sec. 29.
(1) Subject to subsection (2), each mortgage loan originator must provide to the commissioner or be covered by a surety bond that meets the requirements of subsection (5). A surety bond provided under this subsection shall provide coverage for the mortgage loan originator in 1 of the following amounts:
(a) If the mortgage loan originator did not originate any mortgage loans in the preceding calendar year, or the sum of the principal amounts of mortgage loans originated by the mortgage loan originator in the preceding calendar year is less than $12,000,000.00, as determined by the commissioner, $10,000.00.
(b) If the sum of the principal amounts of mortgage loans originated by the mortgage loan originator in the preceding calendar year is $12,000,000.00 or more and less than $24,000,000.00, as determined by the commissioner, $25,000.00.
(c) If the sum of the principal amounts of mortgage loans originated by the mortgage loan originator in the preceding calendar year is $24,000,000.00 or more, as determined by the commissioner, $50,000.00.
(2) If a mortgage loan originator is an employee or exclusive agent of a sponsor and that sponsor provides the commissioner with a surety bond that satisfies the requirements of subsection (5), the commissioner may accept that surety bond in lieu of the mortgage loan originator's surety bond obligation under subsection (1). The principal amount of a surety bond provided under this subsection shall provide coverage for all of the sponsor's mortgage loan originators in 1 of the following amounts:
(a) If the sum of the principal amounts of mortgage loans closed or modified by the sponsor in the preceding calendar year is less than $12,000,000.00, as determined by the commissioner, $50,000.00.
(b) If the sum of the principal amounts of mortgage loans closed or modified by the sponsor in the preceding calendar year is $12,000,000.00 or more and less than $24,000,000.00, as determined by the commissioner, $150,000.00.
(c) If the sum of the principal amounts of mortgage loans closed or modified by the sponsor in the preceding calendar year is $24,000,000.00 or more, as determined by the commissioner, $250,000.00.
(3) The license of a mortgage loan originator who fails to meet the requirements of section 9(1)(g) or (h) is automatically subject to a condition that he or she may not originate mortgage loans under this act. A mortgage loan originator who is subject to a condition described in this subsection shall immediately cease originating mortgage loans and shall not originate mortgage loans until that condition is removed by the commissioner.
(4) Before the end of a calendar quarter, a sponsor that provides a surety bond under subsection (2) for its employees and exclusive agents shall submit a report to the commissioner that contains all of the following information about the surety bond in effect for the next calendar quarter:
(a) The name and unique identifier of the sponsor.
(b) The name of the surety issuing the bond.
(c) For each mortgage loan originator covered by the bond, his or her legal name, exactly as filed with the nationwide mortgage licensing system and registry, and unique identifier.
(5) All of the following apply to a surety bond provided under subsection (1) or (2):
(a) The bond shall be in a form as prescribed by the commissioner.
(b) The commissioner may promulgate rules with respect to the requirements for surety bonds under this section that the commissioner determines are necessary to accomplish the purposes of this act.
(c) If an action is commenced on a bond described in this section, the commissioner may require the filing of a new bond. If there is a recovery in that action, the mortgage loan originator or sponsor described in subsection (2) shall immediately provide to the commissioner a new surety bond that meets the requirements of this section.
History: 2009, Act 75, Eff. July 31, 2009 ;-- Am. 2010, Act 356, Imd. Eff. Dec. 22, 2010 ;-- Am. 2012, Act 150, Imd. Eff. May 30, 2012