New Mexico Surety Bonds Overview

To get a business license in New Mexico, you need to apply at one of the various licensing agencies in the state. Often, as part of the licensing process, you also need to submit a surety bond.

In much the same way, in order to perform on a state or federal construction project as a contractor, you will usually be required to get a surety bond.

Why do I need a bond?

The bond that you get serves as a protection to the parties that require you to get bonded - typically that’s the state but the bond also serves to protect the public as well as individual persons.

Surety bonds are agreements between three parties:

  • The party that’s protected by the bond, the bond obligee
  • The party that has to get bonded, the bond principal
  • The party that issues the bond, the surety bond company

Bonds list various conditions which the principal must comply with such as particular responsibilities and obligations, as well as more generally compliance with state law. By requiring principals to comply with the conditions, the bond serves as a guarantee to obligees.

If a principal violates these conditions, the bond also functions as financial security, offering compensation to any obligee that suffers losses due to such a violation.

To find out more about how bonds work, see ‘What is a surety bond’ guide!

If you’re ready to apply for your bond search for it in the table below and follow the application link.

If you’re not sure what kind of bond you need, see the sections below for more information!

Find the Bond You Need

The table below contains a list of only the most popular surety bonds. If you can't find yours, fill out our online application and select "Not in the list".

Contractor License Performance & Payment (State) Bond Construction Industries Division Contractor License Apply Now
Contractor License Performance & Payment (State) Bond NM Manufactured Housing Division Installer and/or Repairman License Apply Now
Contractor License Performance & Payment (State) Bond Construction Industries Division Contractor License Code Bond Apply Now
Contractor License Performance & Payment (State) Bond New Mexico Regulation & Licensing Dept Modular Structure Certification Bond Apply Now
Contractor License Performance & Payment (State) Bond STATE OF NEW MEXICO Service Contract Provider Bond Apply Now
Collection Agency Bond Finance Institutions Division Collection Agency Corporate Bond Apply Now
Professional Fund Raisers Bond New Mexico - Office of the Attorney General Professional Fund Raisers Bond Apply Now
Insurance Adjusters Bond New Mexico Public Regulatory Commission Licensing Insurance Adjusters Surety Apply Now
Mortgage Broker (1st & 2nd Mortgages) Bond Director,Financial Institutions Division, Regulati Mortgage Loan Company Apply Now
Mortgage Lender/Banker (1st & 2nd Mort.) Bond State Of New Mexico MORTGAGE LOAN COMPANY CORPORATE SURETY BOND Apply Now
Auto & Mobile Home Dealers (New & Used) Bond Motor Vehicle Division Vehicle Dealer or Auto Recycler Apply Now
Auto & Mobile Home Dealers (Used Only, No New) Bond Motor Vehicle Division Vehicle Dealer or Auto Recycler Apply Now
Motor Vehicle (Non-Dealer, Not Listed) Bond Motor Vehicle Division Title Service Company Bond Apply Now
Sport Permits Bond State Athletic Commission Promoters of Professional Athletic Events Apply Now
Detectives Bond State of New Mexico PRIVATE INVESTIGATOR OR PRIVATE PATROL OPERATOR LI Apply Now
Employment Agencies Bond New Mexico Regulation and Licensing Department Employee Leasing Company Apply Now
Professional Licenses (All Other) Bond New Mexico Regulation and Licensing Department Employee Leasing Program Apply Now
Schools (All) Bond DOT - Traffic Safety Bureau Driver Training School Apply Now
Schools (All) Bond New Mexico Higher Education Department Private Postsecondary Institution Bond Apply Now
Contractors Tax (Single Contract) Bond State of New Mexico Contractors Taxation Surety Apply Now
Contractors Tax (Single Contract) Bond New Mexico Taxation & Revenue Department Contractors Tax (Single Contract) Bond Apply Now
Utility Deposit Bond Public Service Company of New Mexico Utility Deposit Bond Apply Now
Telemarketing/Phone Solicitor Bond New Mexico - Office of the Attorney General Professional Fundraiser Apply Now
Repossession Agent Bond Regulation and Licensing Department Repossessor's Company Corporate Apply Now
Appraisal Management State of New Mexico Appraisal Management Company Registration Apply Now

Types of Surety Bonds in New Mexico

Surety bonds, regardless of the state, can be divided into three main categories.

  • License and permit bonds are necessary for business licensing purposes
  • Contract bonds are necessary for construction contracting purposes
  • Court bonds are necessary in certain instances when appearing before a court

License & Permit Bonds

As the name implies, license bonds are a mandatory requirement for certain businesses without which they cannot hold a business license. A license bond has different purposes, but it’s most often a way to regulate businesses and make sure they conform to certain rules.

For example, auto dealerships must be bonded in most cases. Auto dealers in New Mexico need to post an auto dealer bond, which guarantees compliance with state laws and regulations. It also protects car buyers in the state. Without the bond, car dealers’ licenses are considered invalid.

Other bonds which are frequently required from New Mexico businesses are freight broker bonds, contractor license bonds, and mortgage broker bonds.

Contract Bonds

If you want to work on a public project in New Mexico, you will usually need a contract bond before you can place a bid or do work. Sometimes private project owners may require construction bonds for work on their projects too.

Simply put, contract bonds protect the project owner and their investment, whether it’s the state or a private entity. Several different types of contract bonds may be necessary, depending on the type of work you do.

Bid bonds are submitted along with the bid and guarantee that, in case you win the bid, you will take on the project and do it the way you described in the contract.

Performance and payment bonds, on the other hand, are necessary once you start working on the project. They make sure that the contractor does not default and the project is completed as agreed in the contract. They also guarantee that all subcontractors, laborers, and suppliers receive their pay on time.

Court Bonds

Court bonds might be required from a New Mexico court to guarantee the financial integrity and rightful conduct of one party during a proceeding and beyond.

An example of a court bond is the fiduciary bond, needed when someone is appointed a guardian or fiduciary to another party’s funds.

Another type of court bond, designed to discourage individuals from appealing court judgments without cause, is called an appeal bond. If the original judgment is kept, the appeal bond guarantees that the individual will pay what they were mandated to.

If you need any advice about the bond you need or how to apply, call us at (866) 450-3412 to speak to one of our experts!

How Much Does a Surety Bond Cost in New Mexico?

Each surety bond has a total bond amount listed on it. It refers to the amount up to which a business or an individual can be liable in case of a bond agreement breach and a successful claim against them. Total bond amounts are set by the obligee, i.e. a state or a local government or regulatory agency.

Yet, to get bonded, you do not have to provide the full amount in order to obtain the bond. Instead, you need to pay what is called a bond premium to the surety underwriter. The premium is just a fraction of the total bond amount and is set by the surety.

How does the surety determine the premium?

What type of premium the surety will ask from an applicant depends mostly on their personal credit score. Some other factors can also play a role in the premium calculation:

  • Financial strength
  • Personal assets and liquidity
  • Years of experience

If an applicant’s credit score is strong, they will likely qualify for the standard market rate of between 1% and 4% of the total bond amount.

For applicants with low credit, rates are slightly higher due to sureties perceiving a greater risk in issuing bonds to them. These applicants will usually be offered a rate between 5%-15% of the total amount. Yet, by improving their personal credit score and finances over time, they can easily qualify for standard market rates down the road.

To get an estimate of the cost of your bond, use our surety bond cost calculator below!

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For even more information about how premiums are determined, see our surety bond cost page!

How to Get Bonded in New Mexico

Ready to apply for your New Mexico surety bond? Follow the instructions below that apply to the type of bond you need.

License bond application

To get started with your license bond application, complete our 1-page online bond form. We will contact you shortly to provide you with a free bond quote and more information about completing the application.

Start your surety bond application today! Why us?
  • Quick turnaround - just 1-2 business days
  • Tailor-made advice on building a strong application
  • Exclusive bad credit programs

Contract Bond Application

To get started with your contract bond application, download the correct contract bond form for your contract. Complete the form and send it to us for review. We will get in touch with you as soon as we receive and process your form.

If you need help with your application or want to know more about the bonding requirements in New Mexico, give us a call at (866)-450-3412!

Further Reading


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.