Overview of Sacramento Surety Bonds
To obtain a business license in Sacramento, you may be required to get a license bond. Such bonds are frequently required of auto dealers, mortgage and freight brokers, but also by a variety of contractors - from general to specialty contractors. These bonds guarantee that bonded businesses will comply with local and state regulations.
An additional requirement some contractors in the city may need to comply with is to obtain a contract bond in order to bid on public works projects and perform work on such projects. These bonds serve as a guarantee that bonded contractors will perform according to the conditions of their contract and pay their subcontractors and material suppliers.
For example, contractors in Sacramento who wish to install or construct water facilities or improvements (such as hydrants) or perform other type of work on public streets and roads, may be required to obtain a Sacramento suburban water district encroachment bond before they can do so.
Certain courts in Sacramento may also request a bond in order for court proceedings to take place. Such bonds may be required when one is appointed a fiduciary or guardian as well as in situations when a court judgment is being appealed.
The purpose of these bonds is to serve as a guarantee that bonded businesses will comply with both state and local laws that apply to their type of work. Each bond is conditioned upon compliance with specific provisions.
When such provisions are violated by the bonded party, a claim can be filed against the bond to compensate any party that has suffered damage or losses as a result. Such compensation can be as high as the full penal sum of the bond.
New to bonds? See our detailed ‘What is a surety bond’ guide for a full explanation of how bonds work!
Below you can find out more about how much a bond in Sacramento may cost, what can give rise to a bond claim, and how you can apply for your bond.
Call us at 866.450.3412 if you need more information about the bonding requirements in Fort Worth!
Cost of Your Surety Bond
To get bonded, you need to pay a surety bond premium. That premium is a percentage of the total bond amount.
For example, the California auto dealer bond has a bond amount of $50,000. To get bonded, applicants only need to pay a fraction thereof. This fraction or rate is determined by the surety when it reviews the bond application. The most significant factor in your application determining your bond cost is your personal credit score. Other factors such as your financial statements or previous professional experience are also taken into account.
Applicants who have a high score, one of 700 FICO or above, are typically offered the lowest rates. For certain bonds this means you can get bonded for as little as 0.75% of the total bond amount or slightly more depending on the bond type and your exact credit score.
To get a precise and free quote on your bond, simply complete our bond application form. We will then contact you with your quote and further details if you wish to complete the bond application process.
Bonds With Bad Credit
Some sureties will turn down applicants who have low credit. With us, a low credit score does not prevent you from getting bonded!
Our Bad Credit Program is designed to allow for applicants with low or nonexistent credit to get bonded just as fast and easily as applicants with higher scores. The only significant difference between this program and our standard markets are the slightly higher rates for applicants with lower credit.
Rates are determined on a case-by-case basis so make sure to visit the program page and request a quote if you want to know how much exactly your bond will cost.
Every bond agreement is conditioned to offer guarantees and protection to certain parties. When the agreement is violated, resulting in damages or losses to those parties, a claim can be filed to request compensation to cover for those damages and losses.
If you are a contractor in Sacramento and want to get a water system encroachment permit, you may also be required to obtain a suburban water district encroachment bond by the Sacramento Suburban Water District. That bond is conditioned to guarantee that contractors with such a permit will comply with the terms of the permit, safeguard any water facilities, streets, highways and anything else they work on, as well as maintain any work they have performed and hold it free from defects for one year.
If the contractor violates any of these conditions, the District can bring a claim against the bond to request compensation for any damages and losses arising out of the violation of the above conditions. Such compensation may also be used to cover litigation costs as well as attorney fees, if necessary.
Once the surety compensates claimants, the bonded party must reimburse the surety, as part of the conditions of the bond agreement. If the bonded party does not give rise to a claim, the only cost they have is the initial cost of getting bonded.
Apply for Your Bond!
To request a free quote on your bond and to begin the bonding process, complete our surety bond application form. We will soon provide you with a quote and additional details on getting bonded.
Once you have finalized your application it will take about two working days to issue your bond. We will then send it to you via email and regular mail.
If you have any questions about getting bonded in Sacramento or other cities in California, call us at 866.450.3412 anytime!