54-14-24. Surety bond requirements. Each mortgage lender, mortgage brokerage, mortgage broker, or mortgage loan originator shall submit with any application, and maintain at all times, a surety bond in an amount that reflects the total dollar amount of loans originated by the licensee and the licensee's employees and agents, but not less than twenty-five thousand dollars. The surety bond shall be in a form and amount as prescribed by the director.
Each mortgage loan originator and mortgage broker shall be covered by a surety bond in accordance with this section. If the mortgage loan originator or mortgage broker is an employee or exclusive agent of a person subject to this chapter, the surety bond of such person can be used in lieu of the mortgage loan originator or mortgage broker's surety bond requirement. The surety bond shall provide coverage for each mortgage loan originator and mortgage broker in an amount prescribed by this section.
The bond shall be issued by a surety company qualified to do business as a surety in this state. The bond shall be in favor of this state for the use of this state and any person who has a cause of action under this chapter against the licensee. The bond shall be conditioned on:
(1) The licensee's faithful performance under this chapter and any rules adopted pursuant to this chapter; and
(2) The payment of any amounts that are due to the state or another person during the time the bond is in force.
The bond may be continuous, and regardless of how long the bond remains in force, the aggregate liability of a surety to all persons damaged by a licensee's violation of the provisions of this chapter may not exceed the amount of the bond. The bond may be cancelled by the surety upon thirty days notice to the licensee and the director, and the surety's liability on the bond shall also terminate upon the effective date of any suspension or revocation of the license.
If an action is commenced on a licensee's bond, the director may require the filing of a new bond. Immediately upon recovery in any action on the bond the licensee shall file a new bond.
The director may promulgate rules pursuant to chapter 1-26 with respect to the requirements for such surety bonds as are necessary to accomplish the purposes of this chapter.
Source: SL 2007, ch 279, § 13; SL 2008, ch 255, § 2; SL 2009, ch 251, § 14.
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