Michigan Mortgage Loan Originator Bond

The Michigan mortgage loan originator bond (MLO bond) is a mandatory financial guarantee required for licensure under Act 75 of 2009. Your required bond amount ranges from $10,000 to $50,000, depending on your prior year’s loan origination volume. This surety bond protects consumers against potential financial misconduct. To understand the volume tiers, costs, and the simple application process, read on for more information.

The Michigan mortgage loan originator bond is a type of surety bond required under the state's mortgage licensing act, specifically MCL § 493.159 (Act 75 of 2009). A surety bond is a contractual agreement that provides a financial guarantee; it ensures the principal (the MLO) will abide by all laws, protecting the obligee (the State of Michigan) and the public from financial harm caused by fraud or misconduct. An individual MLO needs their own bond, unless their sponsoring employer covers them under a larger company bond. MLO bonds are filed electronically through the NMLS Electronic Surety Bond (ESB) system, which transmits the bond directly to the Michigan DIFS. Forms FIS-2135 and FIS-2137 are maintained for reference but are no longer submitted physically.

The actual cost of your mortgage loan originator bond is a small percentage of the total bond amount, known as the premium, which is determined by a few key financial factors. Your specific required bond amount is directly linked to your loan volume from the previous year.

The bond amount for individuals is tiered based on the total dollar amount of mortgage loan originations in the prior calendar year: $10,000 if less than $12 million; **$25,000** if originations are between $12 million and $24 million ; and **$50,000** if originations are greater than or equal to $24 million. Premium rates typically range from 1% to 5% of the bond amount. For a $25,000 bond, a highly qualified applicant might pay $250 (1%) annually, while an applicant with a higher risk profile could pay $1,250 (5%) or more. Companies sponsoring MLOs also have separate bond thresholds. Learn more about the factors influencing your premium by reviewing the Surety Bond Cost.

The process of securing your Michigan MLO license bond is straightforward, focusing on determining the correct bond amount and properly filing the necessary forms with the state regulator. Following the steps precisely ensures a smooth transition to licensure.

First, you must decide whether you require an individual or company bond. Next, you choose a licensed surety and submit a bond application, which may include financials. Finally, you must sign and file the original bond document, along with the Power of Attorney, with the DIFS Consumer Finance Division. Ensure you submit the correct forms—FIS-2135 for individuals or FIS-2137 for companies. The bond must be kept in force continuously, and your surety will provide notifications to ensure simple renewal processes for continuous coverage. For detailed filing instructions, refer to the official instructions from the DIFS. For general guidance on the process, learn how to get bonded.

While a challenged credit history can make the underwriting process more complex, our client provides flexible underwriting to help make MLO bonds accessible to a wide range of applicants. We prioritize transparency in pricing to ensure you understand your final premium.

Sureties review credit history as part of their assessment, as it is a major factor in underwriting decisions. For applicants with lower credit scores, alternatives may include paying a higher premium rate, using a co-signer, or sometimes posting additional collateral. Our goal is to work with multiple markets to find the most favorable terms for you. We provide a quick and transparent approval process to help you get bonded and improve your chances of approval. Start the process with our online application.

If my employer (sponsor) has a company bond, do I need an individual bond?

No, if your sponsoring mortgage company maintains an active company surety bond (Form FIS-2137) that covers all sponsored MLOs, you are typically not required to file an individual mortgage loan originator bond (Form FIS-2135). The company bond covers only those MLOs who are formally sponsored and listed under the company’s NMLS record. Independent or unsponsored MLOs must file individual bonds. You should always confirm your status with your employer and the Consumer Finance Division to ensure full compliance.

When does the bond have to be filed?

The MLO bond must be filed with the Michigan DIFS and must be effective on the date you are issued your license or any time you are actively engaged in loan origination activities. Continuous coverage is required to comply with the Michigan Mortgage Loan Originator Licensing Act. MLOs must ensure there is no gap in their bond coverage when renewing their license each year.

Does cancellation mid-term occur, and what is the notice period?

Yes, a bond can be canceled mid-term by either the principal or the surety. Cancellation requires written notice to be submitted to the Michigan DIFS. The specific notice period is usually stipulated in the bond’s terms, which often requires 30 days' advance notice. Since maintaining a bond is a mandatory requirement for your license, a cancellation without a replacement bond will lead to the suspension or revocation of your MLO license.

What happens if a claim is filed against my bond?

If a claim is filed, the surety company investigates the complaint to verify the MLO violated the terms of their license and caused a financial loss to the consumer. If the claim is found to be valid, the surety pays the claimant up to the full bond amount. However, the MLO (the principal) is legally required to reimburse the surety for the entire amount paid out, as the bond is a financial guarantee, not insurance for the MLO.

Michigan Department of Insurance and Financial Services. (n.d.). Instructions for Filing Individual Mortgage Loan Originator Bond (FIS 2135). Retrieved October 15, 2025, from
https://www.michigan.gov/-/media/Project/Websites/difs/Form/CF/MLO/FIS_2135.pdf?rev=42c8fe0c81cd40d1b9cdb05d81f9e7a8.

Michigan Department of Insurance and Financial Services. (n.d.). Consumer Finance Division. Retrieved October 15, 2025, from
http://www.michigan.gov/difs/0,5269,7-303-13251_13257---,00.html.

Michigan Department of Insurance and Financial Services. (n.d.). BOND FORM FIS 2135. Retrieved October 15, 2025, from
http://www.michigan.gov/documents/dleg/RHD_FIS_2135_BOND_317197_7.pdf.

Michigan Compiled Laws. (2024). Chapter 493. Regulatory Loans §493.159. Retrieved October 15, 2025, from
https://codes.findlaw.com/mi/chapter-493-regulatory-loans/mi-comp-laws-493-159/.

Lance Surety Bonds. (n.d.). online application (Internal Link). Retrieved October 15, 2025, from
https://www.lancesuretybonds.com/surety-bond-quote.

Lance Surety Bonds. (n.d.). Surety Bond Cost (Internal Link). Retrieved October 15, 2025, from
https://www.lancesuretybonds.com/learn/surety-bond-cost.

Lance Surety Bonds. (n.d.). how to get bonded (Internal Link). Retrieved October 15, 2025, from
https://www.lancesuretybonds.com/learn/how-to-get-bonded.