Canceling, Returning, or Voiding an Electronic Surety Bond (ESB)

Surety companies and surety bond producers can cancel, return, or void Electronic Surety Bonds (ESBs) in NMLS when a bond is no longer valid, requires correction, or must be withdrawn from regulatory consideration.

About this task

Bond cancellations and voids are common events in the Electronic Surety Bond (ESB) lifecycle. A cancellation terminates the bond’s active status and notifies the regulator that the licensee’s coverage will end on a specified date. A return occurs when a regulator or licensee requests changes or corrections before the bond becomes effective. A void permanently removes the bond record when it was created in error or superseded by another bond.

Both surety companies and surety bond producers can initiate cancellations or respond to regulator returns, depending on their assigned NMLS roles and the terms of the bond association. Regulators may also initiate returns to request corrections or clarifications.

Note: Voids can only be performed by the surety company that executed the bond. Once voided, the bond cannot be reactivated and is permanently archived in NMLS.

Procedure

Sign in to NMLS using an account with Manage Bonds or Manage and Sign Bonds permissions.
From the Tasks tab, select Electronic Surety Bonds, then choose Managed Bonds.
Search for the bond you want to cancel, return, or void by bond number or licensee name.

Note: Only bonds in Active, Pending Execution, or Delivered to Regulator status can be canceled or returned. Voiding is available only for bonds created in error that have not yet been accepted by the regulator.
Open the bond record and select the appropriate action:
1. Cancel Bond — Ends coverage effective on a future date specified by the surety company or producer.
2. Return Bond — Allows you to send the bond back for correction before it becomes active.
3. Void Bond — Removes the bond record when created in error or replaced by another bond.
Enter the required details for the selected action, such as effective date, reason for cancellation or return, and comments for the regulator.

Note: Comments entered in this field appear to the regulator and the associated licensee and should clearly describe the reason for the action.
Select Submit to finalize the action.

Note: Once submitted, the bond status immediately updates in NMLS. For cancellations, the bond remains visible until the effective date passes; for voids, the bond is immediately archived.

What to do next

Tips for managing bond cancellations and returns

Use cancellation only when the licensee’s obligation is ending or transferring to another bond.
Ensure effective dates are accurate and meet regulator-required notice periods.
Provide clear, detailed comments for regulators to minimize follow-up requests.
Do not use Void for regulator-directed returns or revisions. Those should be managed through the return process.
Once a bond is canceled or voided, a new bond must be created to restore coverage for the licensee.

Note: Returned bonds can be corrected and resubmitted in NMLS. Regulators review updated information and either accept or return the bond again for further clarification.