Ohio § 1322.32

§ 1322.32.

(A)(1) No registrant shall conduct business in this state, unless the registrant has obtained

and maintains in effect at all times a corporate surety bond issued by a bonding company

or insurance company authorized to do business in this state.  The bond shall be in favor of the superintendent of financial institutions and in

the penal sum of one-half per cent of the aggregate loan amount of residential mortgage

loans originated in the immediately preceding calendar year, but not exceeding one

hundred fifty thousand dollars.  Under no circumstances, however, shall the bond for mortgage lenders and mortgage

brokers be less than fifty thousand dollars and an additional penal sum of ten thousand

dollars for each location, in excess of one, at which the registrant conducts business.  The bond amount for registrants that engage exclusively in the business of mortgage

servicing shall be a minimum of one hundred fifty thousand dollars.  The term of the bond shall coincide with the term of registration.  A copy of the bond shall be filed with the superintendent.  The bond shall be for the exclusive benefit of any buyer injured by a violation

by an employee of the registrant, mortgage loan originator employed by or associated

with the registrant, or registrant of any provision of this chapter or any rule adopted

thereunder.  The aggregate liability of the corporate surety for any and all breaches of the

conditions of the bond shall not exceed the penal sum of the bond. (2)(a) No licensee who is employed by or associated with a person or entity holding a valid

letter of exemption under division (B)(1) of section 1322.05 of the Revised Code shall conduct business in this state, unless either the licensee or the person or

entity on the licensee's behalf has obtained and maintains in effect at all times

a corporate surety bond issued by a bonding company or insurance company authorized

to do business in this state.  The bond shall be in favor of the superintendent of financial institutions and in

the penal sum of one-half per cent of the aggregate loan amount of residential mortgage

loans originated in the immediately preceding calendar year, but not exceeding one

hundred thousand dollars.  Under no circumstances, however, shall the bond be less than fifty thousand dollars.  The term of the bond shall coincide with the term of licensure.  A copy of the bond shall be filed with the superintendent.  The bond shall be for the exclusive benefit of any buyer injured by a violation

by the licensee of any provision of this chapter or any rule adopted thereunder.  The aggregate liability of the corporate surety for any and all breaches of the

conditions of the bond shall not exceed the penal sum of the bond. (b) Licensees covered by a corporate surety bond obtained by a registrant, or by a person

or entity holding a valid letter of exemption under division (B)(1) of section 1322.05 of the Revised Code , they are employed by or associated with shall not be required to obtain an individual

bond. (B)(1)(a) The registrant shall give notice to the superintendent by certified mail of any action

that is brought by a buyer against the registrant, mortgage loan originator, or employee

alleging injury by a violation of any provision of this chapter or any rule adopted

thereunder, and of any judgment that is entered against the registrant, mortgage loan

originator, or employee by a buyer injured by a violation of any provision of this

chapter or any rule adopted thereunder.  The notice shall provide details sufficient to identify the action or judgment,

and shall be filed with the superintendent within ten days after the commencement

of the action or notice to the registrant of entry of a judgment. (b) The licensee shall give notice to the superintendent by certified mail of any action

that is brought by a buyer against the licensee alleging injury by a violation of

any provision of this chapter or any rule adopted thereunder, and of any judgment

that is entered against the licensee by a buyer injured by a violation of any provision

of this chapter or any rule adopted thereunder.  The notice shall provide details sufficient to identify the action or judgment,

and shall be filed with the superintendent within ten days after the commencement

of the action or notice to the licensee of entry of a judgment.  A person or entity holding a valid letter of exemption under division (B)(1) of section 1322.05 of the Revised Code that secures bonding for the licensees employed by or associated with the person

or entity shall report such actions or judgments in the same manner as is required

of registrants. (2) A corporate surety, within ten days after it pays any claim or judgment, shall give

notice to the superintendent by certified mail of the payment, with details sufficient

to identify the person and the claim or judgment paid. (C) Whenever the penal sum of the corporate surety bond is reduced by one or more recoveries

or payments, the registrant or licensee shall furnish a new or additional bond under

this section, so that the total or aggregate penal sum of the bond or bonds equals

the sum required by this section, or shall furnish an endorsement executed by the

corporate surety reinstating the bond to the required penal sum of it. (D) The liability of the corporate surety on the bond to the superintendent and to any

buyer injured by a violation of any provision of this chapter or any rule adopted

thereunder shall not be affected in any way by any misrepresentation, breach of warranty,

or failure to pay the premium, by any act or omission upon the part of the registrant

or licensee, by the insolvency or bankruptcy of the registrant or licensee, or by

the insolvency of the registrant's or licensee's estate.  The liability for any act or omission that occurs during the term of the corporate

surety bond shall be maintained and in effect for at least two years after the date

on which the corporate surety bond is terminated or canceled. (E) The corporate surety bond shall not be canceled by the registrant, the licensee,

or the corporate surety except upon notice to the superintendent by certified mail,

return receipt requested.  The cancellation shall not be effective prior to thirty days after the superintendent

receives the notice. (F) No registrant or licensee employed by or associated with a person or entity holding

a valid letter of exemption under division (B)(1) of section 1322.05 of the Revised Code shall fail to comply with this section.  Any registrant or licensee that fails to comply with this section shall cease all

mortgage lender, mortgage broker, mortgage servicer, or mortgage loan originator activity

in this state until the registrant or licensee complies with this section.