Pennsylvania Senate Bill 751 was passed on December 22, 2017, meaning Pennsylvania mortgage servicers must be licensed to work within the state of Pennsylvania. The bill requires mortgage servicers to obtain a $500,000 surety bond to protect consumers who are injured by harmful actions on the part of the licensee’s mortgage business operations. Effective April 1, 2018, mortgage servicers may apply for their license via the Nationwide Multistate Licensing System.
What is mortgage servicing?
Servicing a mortgage involves collecting and crediting payments to a consumers loan, paying property tax and homeowner insurance if you have an escrow account, and informing consumers when property taxes rise and fall. Mortgage servicers may take penalizing actions on a mortgaged home if the borrower fails to adhere to the terms of the agreement. Actions that may be taken by servicers include charging fines or foreclosing if client payments are late.
With regard to general requirements, a mortgage servicer licensee should always act in good faith when it comes to paid-in-full mortgage loans by requesting the mortgage holder to release a lien on the house or building and delivering releases and documents to the consumer as evidence of the release. Mortgage servicers should then request that the mortgage holder cancel any insurance provided in connection with the mortgage loan and refund the borrower.
Other licensing requirements for Pennsylvania mortgage servicers
The Department of Banking and Securities will consider an applicant for a mortgage servicer license only if they meet the following requirements:
- Be approved by and meet at least one Federal government-sponsored entity or corporation’s criteria for residential mortgage loan servicers
- Establish and maintain minimum net worth of $250,000
- Receive approval for fidelity bond coverage according to Federal National Mortgage Association or Federal Home Loan Mortgage Corporation guidelines
- Maintain $500,000 surety bond
- Designate qualifying individual for principal place of business
Ready to get bonded?
If you need to get bonded as a mortgage servicer in Pennsylvania, the experts at SuretyBonds.com are here to help. Get started today by giving us a call at 1 (800) 308-4358 or fill out an online application by clicking the button below!