Montana Escrow Business License Bond

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Montana Escrow Business License Bond: A Comprehensive Guide

This guide provides information for insurance agents to help their customers obtain a Montana Escrow Business License bond.

At a Glance:

  • Lowest Cost: $375 per year or $38 a month
  • Bond Amount: $100,000
  • Who Needs It: All escrow businesses operating in Montana
  • Purpose: To protect the public from financial harm if the escrow business commits fraud or engages in unfair business practices
  • Who Regulates Escrow Businesses in Montana: The Montana Division of Banking and Financial Institutions
Montana Escrow Business License Bond Form
Montana Escrow Business License Bond Form


Montana Code 32-7-109 requires all escrow businesses operating in the state to obtain a license from the Division of Banking and Financial Institutions. The Montana Legislature enacted the licensing requirement to ensure that escrow businesses do not engage in unethical business practices. To provide financial security for the enforcement of the licensing law, escrow businesses must purchase and maintain a $100,000 surety bond to be eligible for licensure.

What Is the Purpose of the Montana Escrow Business License Bond?

Montana requires all escrow businesses to purchase a surety bond as part of the application process to obtain a license. The bond ensures that restitution is available to any damaged party should the escrow business fail to abide by the regulations outlined in the Montana Code Title 32, Chapter 7. Specifically, the bond protects claimants if the escrow business commits fraud or engages in unfair business practices. In short, the bond is a type of insurance that protects the public if the escrow business violates the terms of its license.

How Can an Insurance Agent Obtain a Montana Escrow Business License Bond?

BondExchange makes obtaining a Montana Escrow Business License bond easy. Simply log in to your account and use our keyword search to find the “escrow business” bond in our database. Don’t have a login? Enroll now and let us help you satisfy your customers’ needs. Our friendly underwriting staff is available by phone (800) 438-1162, email, or chat from 7:30 AM to 7:00 PM EST to assist you.

At BondExchange, our 40 years of experience, leading technology, and access to markets ensures that we have the knowledge and resources to provide your clients with fast and friendly service whether obtaining quotes or issuing bonds.

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Is a Credit Check Required for the Montana Escrow Business License Bond?

Surety companies will run a credit check on the applicant to determine eligibility and pricing for the Montana Escrow Business License bond. Escrow businesses with excellent credit and work experience can expect to receive the best rates. Escrow businesses with poor credit may be declined by some surety companies or have to pay higher rates. The credit check is a “soft hit”, meaning that the credit check will not affect the applicant’s credit.

How Much Does the Montana Escrow Business License Bond Cost?

The Montana Escrow Business License bond can cost between $375 to $6,000 per year or $38 to $600 a month. Insurance companies determine the rate based on several factors including your customer’s credit score and experience. The chart below briefly references the approximate bond cost on the $100,000 bond requirement.

$100,000 Montana Escrow Business License Bond Cost

Credit Score* Bond Cost (1 Year) Bond Cost (1 month)
720+ $375 $38
680 – 719 $450 $45
660 -679 $700 $70
649 – 659 $1,000 $100
629 – 648 $1,500 $150
600 – 628 $2,500 $250
580 – 599 $3,500 $350
550 – 579 $4,000 $400
525 – 549 $5,000 $500
500 – 525 $6,000 $600

*The credit score ranges do not include other factors that may result in a change to the annual premium offered to your customers, including but not limited to, years of experience and underlying credit factors contained within the business owner’s credit report.

How Does Montana Define “Escrow Business”?

To paraphrase Montana Code 32-7-102, escrow businesses hold property in a trust for a third party until certain conditions have been met. For example, when an individual is purchasing a house, an escrow business will hold onto the title to the property and the initial down payment until both the buyer and seller meet all of their contractual obligations.

Exemptions to this definition include the following:

  • Banks, trust companies, building/loan or savings/loan associations, credit unions, or insurance companies
  • Licensed attorneys performing their regular duties
  • Licensed abstractors performing title searches for the issuance of a title insurance policy
  • Licensed real estate brokers

Montana Escrow Business License Bond

BondExchange now offers monthly pay-as-you-go subscriptions for surety bonds. Your customers are able to purchase their bonds on a monthly basis and cancel them anytime. Learn more here.

How Do Escrow Businesses Become Licensed in Montana?

Escrow businesses in Montana must navigate several steps to obtain a license. Below are the general guidelines, but applicants should refer to the Division’s Escrow Business Licensing webpage for details on the process.

License PeriodThe license period for Montana escrow businesses is January 1st to December 31st. 

Step 1 – Purchase Surety Bond

Escrow businesses operating within the State of Montana are required to purchase and maintain a surety bond.

Step 2 – Complete the Application

Applications for an escrow business license must be completed through the National Multistate Licensing System & Registry (NMLS). A checklist for what is required within the application can be found here. A $350 initial license fee also applies.

How Do Escrow Businesses in Montana Renew Their Licenses?

Escrow businesses can renew their licenses online through the NMLS website. License renewal applications are due by December 1st of each year and are subject to a $100 standard fee.

What Are the Insurance Requirements for Escrow Businesses in Montana?

Montana does not require escrow businesses to purchase any form of liability insurance as a prerequisite to obtaining a license. Escrow businesses must purchase and maintain a $100,000 surety bond.

How Do Montana Escrow Businesses File Their Bonds?

Escrow businesses should submit their completed bond forms, including the power of attorney, electronically through the NMLS. The surety bond requires signatures from the surety company, as well as a representative from the escrow business. The surety company should include the following information on the bond form:

  • Bond number
  • The legal name of the individual buying the bond
  • Surety company’s name 
  • Date the bond is signed

What Can Montana Escrow Businesses Do to Avoid a Claim Against Their Surety Bond?

To avoid claims against their bonds, escrow businesses in Montana must follow all license regulations in the state, including some of the most important issues below that tend to cause claims:

  • Negligence
  • Misrepresentation
  • Fraud

What Other Insurance Products Can Agents Offer Escrow Businesses in Montana?

Most reputable escrow businesses will purchase business liability insurance. Bonds are our only business at BondExchange, so we do not issue any other types of insurance, but our agents often utilize brokers for this specific line of business. A list of brokers in this space can be found here.

How Can Insurance Agents Prospect for Escrow Business Customers in Montana?

Montana conveniently provides a public database to search for active escrow businesses in the state. The database can be accessed here. Contact BondExchange for additional marketing resources. Agents can also leverage our print-mail relationships for discounted mailing services.

Montana Escrow Business License Bond