Collection Agency Bond

What Are Collection Agency Bonds?

Collection agency bonds guarantee the compliance with regulations in the state in which the agency operates. They are a licensing requirement for collection agencies or third-party debt collectors in most states.

Apart from guaranteeing compliance with state laws, the purpose of the bond is to make sure funds collected by an agency are collected in a proper manner and rightfully distributed to their clients.

These bonds also protect the state and the public from collection agencies that misuse collected funds or make use of illicit means and practices to collect debts.

If an agency is found to be in violation of these conditions, a claim can be filed against their bond to secure compensation for anyone who suffers losses or damages as a result. The surety that backs the bond then investigates the claim and may offer compensation to claimants for as much as the full amount of the bond.

**NEW:** Download our free 50+ pages e-book for an in-depth overview of all the steps you need to take when opening a debt collection agency in your state!

If this is your first time getting bonded, see our ‘What is a surety bond’ guide for a full explanation of how bonds work, and why they are required by law.

For more information about the cost of your bond, and how to get bonded, see the sections below.

What’s the Cost of a Collection Agency Bond?

A collection agency bond’s cost is equal to a fraction of the total bond amount.

The amount of the bond is set at the state level and varies significantly between states. The cost is determined by the surety you apply with, based on several criteria.

How is bond cost determined?

What percentage or rate you will be offered by a surety depends on a number of financial factors, with personal credit score being the most important one. To determine your rate, sureties may also consider:

• Your financial statements
• Your assets and liquidity
• Your industry experience and resume

Applicants who have a high credit score are offered bonds at so-called standard market rates that vary between 1%-2,5% of the total bond amount.

Find out more about what determines your bond’s cost and how you can lower it over time through our expert surety bond cost guide!

What if I have a low credit score?

Those who have trouble with their credit score or have no credit at all can still get bonded, even though at higher rates. Rates for such applicants are typically upward of 3% of the bond amount.

Rates for such applicants are usually higher, due to a higher risk involved in bonding applicants with poor credit. Yet by improving your credit score over time, you can get increasingly better rates!

Try our bond calculator below to get an estimate of the cost of your bond.

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Surety Bond Cost Calculator

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How Do I Apply for a Collection Agency Bond?

Get started by completing our online bond application form.

We will soon get back to you with a free quote on your bond, and further details on finalizing your application.

If you have difficulties with your application or need advice and guidance, call us at 866.450.3412!

About us:

Bryant Surety Bonds

Bryant Surety Bonds, Inc. is a surety bond agency based in Pennsylvania. Licensed in all 50 states and with access to over 20 T-listed, A-Rated bonding companies, we have the contacts, expertise, and top service to provide you with a hassle-free experience, all while offering competitive rates for your surety bond.