Washington Consumer Loan Business Bond Overview
- Purpose: To ensure lenders and servicers uphold the Consumer Loan Act
- Who Needs It: Loan originators, brokers, third-party modification providers and student loan servicers in Washington
- Regulating Body: The Washington Department of Financial Institutions
- Bond Amount: $30,000–$150,000, based on loan activity and volume
- Minimum Price: $195; credit-based
What Is a Washington Consumer Loan Business Bond?
A Washington consumer loan business bond protects borrowers from deceptive lending practices. You need a surety bond if you:
- originate or broker loans,
- service student loans, or
- provide third-party loan modification services.
Bond Coverage Requirements for Consumer Loan Businesses
The Washington Department of Financial Institutions (DFI) sets the surety bond amount based on your loan activity and/or volume.
| Loan Activity | Bond Amount |
|---|---|
| Mortgage loan originating (residential or non-residential)* | $30,000–$150,000, based on prior loan origination volume |
| Third-party loan modification | $30,000 |
| Student education loan servicing | $30,000 |
| Residential mortgage loan servicing | No bond required, unless used in lieu of minimum net worth |
*If you originate both residential and non-residential loans, your bond amount is based on the combined volume.
You only need to adjust your bond amount annually if you conduct loan origination or lending activities. New licensees start at the $30,000 minimum.
| Loan Volume | Bond Amount |
|---|---|
| ≤$20,000,000 | $30,000 |
| $20,000,001–$40,000,000 | $50,000 |
| $40,000,001–$50,000,000 | $100,000 |
| Over $50,000,000 | $150,000 |
How Much Do Consumer Lender Bonds Cost in Washington?
Washington consumer loan business bonds start at $195, or 0.65% of the bond amount. Your exact rate will vary based on your coverage and credit score.
Apply for a free, no-obligation quote today!
SuretyBonds.com offers the lowest available rates from our nationwide provider network with no added fees.
How Does a Washington Consumer Loan Business Bond Work?
When you purchase this bond, you enter into a three-party contract.
| Bond Party | Description |
|---|---|
| Principal | The lender filing the bond |
| Obligee | The Washington Department of Financial Institutions requiring the bond |
| Surety | The issuing surety provider |
This bond is your financial guarantee to the state that you’ll uphold the Washington Consumer Loan Act. If you violate this law, harmed parties can file bond claims. The surety will pay valid claims up to the full bond amount. However, you must ultimately refund the surety.
How Do I Get Bonded?
You can start the bonding process right on this page! Just fill out the quote request form, and we’ll email your exact rate within one business day.
How Do I File My Bond?
We’ll upload your official bond form to NMLS on your behalf. However, you’ll need to grant authority to your issuing surety provider.
When you log in to your NMLS account, enter the surety’s name or surety identifier (NAIC/NPN) as found on your bond form. Your bond can’t be accepted by the DFI until you authorize the surety.
How Do I Renew My Bond?
Washington consumer loan business bonds expire annually. We’ll send you periodic renewal notices starting 90 days before expiration. Just pay the invoice to extend your bond for another term.
How Do I Update My Bond Form?
If you need to change your personal information or bond amount, email [email protected]. We’ll issue a bond rider or a new form, depending on the change.
How to Open a Consumer Loan Business in Washington
If you’re a servicer, first make sure you meet the minimum net worth requirements:
- Residential mortgage servicers (loans not backed by a GSE): $100,000–$1,000,000 (scaled to portfolio size)
- Student education loan servicers: $250,000
Then, register with the Secretary of State and Business License Services.
The DFI manages all licenses in NMLS. You cannot mail-in any application materials. The fees are $1,162.21 for the main office and $604.46 per branch.
After submitting your application in NMLS, you’ll need to email the required declaration forms to [email protected]. If your control people don’t have fingerprints already uploaded, you’ll also need to schedule a fingerprinting appointment.
Do I Need to Have a Physical Location in Washington?
No, you're not required to maintain a physical presence in the state. However, if you do business with Washington residents, you need a state license, regardless of where your company is based.
