Maryland Collection Agency Bond Overview
- Purpose: To protect consumers from financially harmful debt collection practices
- Who Needs It: All debt collection agencies operating in Maryland
- Regulating Body: The Office of Financial Regulation — State Collection Agency Licensing Board
- Bond Amount: $50,000–$100,000
- Minimum Price: $500, credit-based
What Is a Maryland Collection Agency Bond?
A Maryland collection agency bond protects the state and your clients from unfair or damaging debt collection practices.
Since collection agencies handle sensitive consumer data, the State Collection Agency Licensing Board requires you to file a surety bond for licensing.
Bond Coverage Requirements for Maryland Collection Agencies
The Board mandates a minimum $50,000 surety bond for all collection agencies in the state. However, you may need to file up to a $1,000,000 surety bond based on the following factors:
- Business size
- Financial health
- Management quality
- Risk to consumers
Contact the Board to verify your exact bond amount.
Call 1(800)308-4358 for assistance if you need a bond greater than $100,000. If you operate in additional states, we also offer collection agency bonds nationwide.
How Much Do Collection Agency Bonds Cost in Maryland?
Maryland collection agency bonds start at $300 for $50,000 coverage. Exact rates vary based on personal credit score and the bond amount. Most qualifying applicants pay 1–5% of the total coverage.
Apply for your free quote today.
SuretyBonds.com offers the lowest available rates from our nationwide provider network with no added fees.
How Does a Maryland Collection Agency Bond Work?
A Maryland collection agency bond is a legal contract between three parties: the principal, obligee and surety.
| Bond Party | Description |
|---|---|
| Principal | The collection agency filing the bond |
| Obligee | The Maryland State Collection Agency Licensing Board requiring the bond |
| Surety | The issuing surety provider |
This bond is your financial guarantee to the Board that you’ll follow state laws and operate ethically.
What Is the Debt Collection Law in Maryland?
The Maryland Consumer Debt Collection Act prohibits the following acts by debt collectors:
- Using force or threatening violence
- Threatening criminal charges
- Disclosing false information about a debtor’s credit
- Contacting a person’s employer without legal authority
- Harassing debtors
- Claiming a right that doesn’t exist
If you commit any of these acts, harmed parties can file claims against your bond. The surety will pay valid claims up to the full bond amount. However, you must ultimately refund the surety.
How Do I Get a Collection Agency Bond in Maryland?
With SuretyBonds.com, you can apply for a free quote online 24/7. Simply enter your information using the form on this page. We’ll run a soft credit check and send you a personalized rate within one business day.
Once you pay the invoice, we’ll upload the official electronic surety bond form to NMLS on your behalf.
How Do I File My Bond?
Once we upload your bond form to NMLS, you’ll need to grant authority to the surety company. When you log in to NMLS, enter the surety’s name or identifier (NAIC/NPN) as found on your bond follow-up email. The obligee can’t accept your bond until you authorize the surety.
Can I Get Bonded With Bad Credit?
Yes, you may still be able to get bonded with bad credit. However, poor credit will likely increase your premium rate.
Fill out the quote request form to receive your personalized price within one business day.
How Do I Renew My Collection Agency Bond?
Maryland collection agency bonds expire annually. We’ll begin sending you reminders by phone and email 90 days before the expiration date.
If your business size or financial situation has changed, you may need to update your bond amount. Otherwise, simply pay the attached invoice to extend your bond for another term.
How Do I Update My Bond Information?
You can often make minor changes, such as name and address, by contacting your surety company. You cannot update the bond form yourself.
If you purchased your bond from us, email [email protected] with the needed change.
How to Get a Collection Agency License in Maryland
The State Collection Agency Licensing Board licenses collection agencies in Maryland. You only need one license for all Maryland locations as long as you submit a list of offices to the Board.
First, register your business with the State Department of Assessments & Taxation (SDAT). Then, upload the following materials to the license application on NMLS:
- Business plan
- Surety bond form
- Statement of prior Maryland business activity
- Certificate of Authority
- Internal policy and management documents
- Example copies of consumer contracts and disclosures
- Business formation documents
- Trust account authorization
- Memorandum of tax certification
- Resume demonstrating industry experience
- Payment for the $470 fee
Maryland collection agency licenses expire annually on December 31. Submit the renewal form through NMLS and pay the $350 fee.
Are Collection Agencies Profitable?
Owning a collection agency can be profitable. Collection agencies typically make money by taking a percentage of the recovered debt, often 25–50%, according to JG Wentworth. They can also purchase defaulted debt for pennies on the dollar.
Profitability largely depends on the volume of debt and the efficiency of your collection strategies. Agencies that rely on low-quality or hard-to-collect debt will generally produce weaker returns.
