Month: March 2018 - Page 2

Late last month, Virginia governor Ralph Northam signed HB 674 into law, adding a surety bond provision for timeshare developers. The bill takes effect on July 1, 2018.

HB 674 modifies a portion of the Virginia Real Estate Timeshare Act. A timeshare is an arrangement wherein individuals own property in conjunction with other individuals on a floating or fixed schedule. The industry is regulated by the Common Interest Community Board, a division of the Department of Professional and Occupational Regulation (DPOR). Timeshare projects and programs need to be registered with the Board, and developers cannot accept any deposits until the project or program has been registered.

That’s where surety bonds come in. Under current law, when a timeshare developer begins accepting deposits, the funds need to be held in escrow until further action is taken. That is, until the cancellation period ends and the buyer can no longer cancel, until the buyer defaults on the contract, or until the deposit is refunded to the buyer. Requiring that the funds are held in an escrow account is a buyer protection measure, and this option is still available to developers to use.

HB 674’s passage means that developers now have another option that still protects buyers’ funds�a surety bond. If the timeshare project consists of 25 or more units, the developer can get a surety bond rather than holding the funds in escrow. If the total deposits equal less than $10,000, the developer needs surety bonds for each separate deposit. But, if the deposits exceed $10,000, they can get a blanket bond in varying amounts instead:

• More than $10,000 but less than $75,000�$75,000 bond
• More than $75,000 but less than $200,000�$200,000 bond
• $200,000 or more but less than $500,000�$500,000 bond
• $500,000 or more but less than $1,000,000�$1,000,000 bond
• More than $1,000,000�Bond equaling 100% of deposits

Timeshare developers are still on the hook for refunding deposits when necessary, and for refunding the surety for any claims it pays out.

Questions about HB 674? Get in touch with the Board. Questions about getting a Virginia surety bond? You’re in the right place�get in touch with Single Source Insurance!

Photo by�Lyndsey Marie�on�Unsplash

If you want to be a Tennessee real estate appraiser, you’ll apply for a license with the Department of Commerce & Insurance. Appraisal management companies need to register and get a surety bond.�Keep reading to find out how to get licensed and bonded, and to learn more about what’s new in May.

Real estate appraiser licensing

Appraisers in Tennessee are regulated by the Department’s Real Estate Appraiser Commission. They start as Registered Trainees and must work under licensed appraisers for 36 months. Trainees also must complete 75 hours of qualifying education in the five years prior to taking the licensure exam. After training is complete, appraiser applicants choose a licensing qualification based on their educational experience:

• State Licensed Appraiser
• State Certified Residential Appraiser
• State Certified General Appraiser

Each type of license allows appraisals of different types of property in varying values�certified general appraisers can appraise any property. OnMay 1, 2018, new rules for each license level’s educational experience will take effect. One notable change is that licensed residential Tennessee real estate appraisers will no longer need 30 hours of college-level education. See the complete breakdown of what kinds of education are accepted for each license qualification. Besides education, the new rule will change the required hours of experience for each license type:

• Licensed Residential Appraisers�1,000 hours in no fewer than six months
• Certified Residential Appraisers�1,500 hours in no fewer than 12 months
• Certified General Appraisers�3,000 hours in no less than 18 months; at least 1,500 hours in non-residential appraisal

Once approved to take the exam, Tennessee real estate appraiser applicants have 12 months and four chances to pass. Then they must submit their application and $555 fee to the Commission.

Appraisal management company registration and bonding

Appraisal management companies (AMCs) need to be certified if they provide appraisal services and during a twelve-month period, oversee 15 or more licensed appraisers in one state, or 25 or more licensed appraisers in two or more states. AMC registration asks for the business’s address and contact information, and asks that a controlling person is specified.

AMCs need to renew their registration every two years, and the Commission does not charge a fee. AMCs need a $20,000 surety bond at the time of registration. The bond is the company’s promise that they will uphold the provisions of the Tennessee Appraisal Management Company Registration and Regulation Act.

Ready to get a Tennessee surety bond? Get in touch with Single Source Insurance for a free quote today!�

Washington collection agencies, both in- and out-of-state, need to get a license and $5,000 surety bond. Keep reading for a rundown on how licensing and bonding work.

Understanding the Process of Getting a Surety Bond License

Washington collection agencies’�licenses are issued by the Department of Licensing (DOL) in conjunction with the Department of Revenue’s Business Licensing Service (DOR; BLS). If your business is in the state and solicits, collects, or attempts to collect debts from debtors, you need the license. If you are based out-of-state and are collecting debts from Washington residents either directly or via a third party, you need the out-of-state agency license.

Collection agencies are required to establish a trust account for the funds they collect on clients’ behalf, and it must be in a sufficient amount to pay all obligations to clients.

Here are the steps you’ll take to apply for the collection agency license through the mail:

1. Get a business license through the Washington Department of Revenue.
2. Submit an application for each separate business location. For more locations of the same business, use a location addendum.
3. Complete a business financial statement. The statement needs to show finances from one of the three months prior to application (December applicants can use September, October, or November). It must show equity or net worth of $7,500 and available cash or its equivalent totaling $7,500.
4. Get a $5,000 surety bond.
5. Pay the licensing fees: $850 for an in-state main office, and $550 for each branch office, or $425 for an out-of-state main office license plus $275 for any other branch locations.

Out-of-state licensees may be exempt from the surety bond and licensing fee requirements if they have fulfilled those obligations in the state where they are based, and if they submit the proper documentation to the Department. Apply for a Washington collection agency license online here.

Collection agency surety bonds

Washington collection agencies are in a fairly high-risk business; malpractice is not uncommon in the finance industry. As a measure of financial protection for consumers, the state mandates that agencies get a $5,000 surety bond with their license. The bond is the agency’s promise to uphold state and federal law regarding their business. If they don’t, and a consumer suffers financial damages, the consumer can file a claim against the bond. Proven claims are paid by the surety, who is then reimbursed by the bondholder.

Have questions about getting bonded or ready to get a quote? Call Single Source Insurance today!�