Overview of Texas Collection Agency Bond Requirements

Third-party debt collectors in Texas are required to obtain a $10,000 collection agency bond in order to perform debt collection in the state. This bond is required by the Texas Secretary of State and must be filed before conducting debt collection.

The purpose of this bond is to guarantee that debt collectors in Texas will comply with the Texas Finance Code, and the obligations and responsibilities they have under Chapter 392. When the surety issues this bond it vouches for the debt collector that they will do so.

Yet, if a collector violates the chapter and thereby causes damages to any person due to that specific violation, a claim can be made against their bond by that person or the state. Bond claims are the means of securing financial compensation to such persons.

Initially, compensation may be extended to claimants by the surety that backs the bond. The amount of compensation is based on the damages suffered and may be even be as high as the full penal sum of the bond.

New to surety bonds? See our ‘What is a surety bond’ guide for a comprehensive overview of how bonds work!

Start your surety bond application today! Why us?
  • The lowest possible rates
  • A 100% money-back guarantee
  • Access to specialty programs, not available to small agencies

If you need more information about this bond or prefer to speak to someone in person, call us at (866)-450-3412!

Cost of Your TX Collection Agency Bond

To get bonded, you need to pay a surety bond premium. The surety that issues your Texas collection agency bond determines the amount of your premium by reviewing your personal credit score, your financial statements, assets, liquidity, and even your industry experience.

Among all of the above, credit score has the most significant impact on the cost of your bond. The higher your credit score is, the lower your bond premium will be. A FICO score of 700 is considered a high score, and applicants with such a credit score can expect to get bonded at the lowest possible rates for this bond.

Get an estimate of your surety bond cost right away by trying our bond calculator or see the table below for a quick reference. You can also request an exact and free quote by submitting a bond form.

Bond Cost Based on Credit Score
Surety bond amount Above 700 Between 650-699 Between 600-649 Below 599
Texas Collection Agency Bond $10,000 $100-$150 $100-$250 $250-$500 $500-$1,000

Bad Credit Bond Program

Though personal credit score is very important in determining an applicant’s bond rate, even if you have a low score, you can still get bonded!

We have created our Bad Credit Program to assist and encourage businesses in getting bonded and continue offering their services and products. While rates for applicants with low credit are higher than for others, they are not fixed forever! You can get increasingly better rates on your bonds as you improve your credit score over time.

Follow the link to the program page to learn about getting bonded with a lower rate, and to request a quote!

Claims Against Your Bond

Chapter 392 of the Texas Finance Code specifically states that the bond required by third-party debt collectors in Texas is specifically for the benefit of any person who is damaged by a debt-collectors violation of that chapter.

This may include prohibited collection practices, such as threats, harassment, unfair, fraudulent and deceptive means, and more. All of these are specifically enumerated and detailed in the chapter. Other violations may include administrative violations such as not reporting to consumers within the mandated time or not correcting inaccuracies in consumers’ files.

When a person files a claim against the debt collector’s bond for damages, the surety must investigate the issue. If there is cause for a claim, and the person has suffered damages, the surety will typically extend compensation to the claimant(s). Such compensation is intended to cover for such damages but cannot exceed the amount of the bond, even if the amount of damages is higher than that amount.

Under the bond agreement, the bonded party - debt collectors - must the reimburse the surety in full for its coverage. In other words, liability still lies with the bonded party, even if the surety initially covers a claim. This is why it is always best to avoid violating legal provisions, so as not to give rise to a claim against your bond!

Apply Here!

To apply for your Texas collection agency bond, complete and submit our bond form. We will first provide you with a free and exact quote on your bond, along with details on continuing your application.

Once we have all your application papers, it may take up to two working days for your bond to be issued by the surety. We will then forward it to you via mail and email.

Not ready to apply? Then simply get a free no-obligations quote, so you can see our low prices!

If you still have any questions about this bond or about getting bonded in general, feel free to call us anytime at (866)-450-3412!


About the author:
Todd Bryant
Todd Bryant is a graduate of Germantown Academy and the University of Pittsburgh College of Business Administration Honors College. He has been President of Bryant Surety Bonds, Inc., an A+ rated Business with the Better Business Bureau, since 2007. Licensed as a producer with the Department of Insurance, he has been published in the National Association of Surety Bond Producers newsletter and on numerous authoritative publications such as The Washington Post, Entrepreneur.com, Azcentral.com and many more.