Pennsylvania Mortgage Broker Advanced Fees Bond

Overview

Pennsylvania's Mortgage Licensing Act draws a bright line around advance fees: under 7 Pa.C.S. § 6131, a mortgage broker that accepts advance fees from consumers must maintain a $100,000 surety bond, while section 6131(e)(1) exempts brokers that do not accept advance fees from the bonding requirement altogether. The bond is filed with the Department of Banking and Securities through NMLS and exists specifically to protect Pennsylvania consumers who hand over money before their loan closes.

Who Needs This Bond?

Mortgage brokers licensed by the Pennsylvania Department of Banking and Securities whose business model involves collecting any fee from a borrower in advance of loan closing — application fees, processing fees, lock fees, or other upfront charges. If your brokerage never touches a consumer's money before closing, § 6131(e)(1) exempts you from this bond, and staying exempt is a legitimate compliance strategy. The moment advance fees enter the model, the $100,000 bond must already be on file.

What is this Bond For?

The bond guarantees that advance fees collected from Pennsylvania consumers are handled as the Mortgage Licensing Act requires — applied to the promised services or refunded when they must be. A borrower who loses money because a broker misused, misappropriated, or wrongfully withheld advance fees can recover against the bond, with the surety paying valid claims up to the $100,000 penal sum and the broker obligated to reimburse the surety. It protects the fee-paying consumer, not the brokerage.

When is it Required?

Before your brokerage accepts its first advance fee — that is the statutory trigger. Practically, the Department verifies bonding through NMLS at licensure and renewal, and a broker whose NMLS record shows advance-fee authority without a corresponding bond has a deficiency. Brokers switching business models mid-license (adding advance fees where they previously charged none) must put the bond in place before the change, not after the first fee is collected.

Where Does it Apply?

The requirement comes from Pennsylvania's consolidated statutes and is administered statewide by the Department of Banking and Securities, with the bond maintained electronically through NMLS. It covers advance fees collected from consumers in connection with Pennsylvania mortgage business wherever your offices sit — an out-of-state broker collecting advance fees from Pennsylvania borrowers is inside the rule. Other states' advance-fee rules differ sharply, so multistate brokers should map each state separately.

How to Buy Online

Click 'Buy This Bond Online' to open the secure surety portal in a new tab, complete the short application, and pay in a single session. The executed bond is delivered ready to associate with your NMLS record for the Department's review.

Why Bond Titan?

Whether you even need this bond depends on one statutory subsection, so this page cites 7 Pa.C.S. § 6131 directly in the Official Sources section below — read it before you buy. Bond Titan is powered by The Southern Agency, a licensed surety agency, with an online flow that keeps NMLS filings on time.

Official Sources

The requirements described on this page are verified against the official sources below.

• $100,000 surety bond required of mortgage brokers that accept advance fees; exemption for brokers that do not accept advance fees (§ 6131(e)(1)): 7 Pa.C.S. § 6131 (verified July 16, 2026)