Common Questions About Surety Bond Rates
Q: How can I get my surety bond rate?
A: The fastest and easiest way to determine your surety bond rate is to contact one of our surety specialists to get a free, no-obligation surety bond price quote. You can do so by calling 1 (800) 308-4358 between 7 a.m. and 7 p.m. CST or by filling out an online contact form 24/7. We’ll shop your application with our numerous underwriters and give you a free, online-only rate within 1 business day.
Q: Will my credit affect my surety bond rate?
A: The answer depends on what type of surety bond you need and its inherent risk. For example, notary bond applications do not require credit reviews since limited risk is involved in the underwriting process. Conversely, contract bond applications do require credit checks since so much financial risk is involved with construction projects.
Generally speaking, the higher your credit score is, the lower your surety bond rate will be. Don’t worry if you have less-than-stellar credit, though, because SuretyBonds.com works with underwriters that specialize in bad credit bonds. This means we can issue bonds to 99% of applicants regardless of their credit. SuretyBonds.com can even offer premium financing premium financing rates to applicants who work with our non-standard markets.
Q: What determines my surety bond rate?
A number of factors might affect your surety bond rate, such as
- the specific bond type
- the bond amount
- the underwriting risk
- your financial credentials
The specialists at SuretyBonds.com are brokers who work with numerous underwriters. This means we can shop your bond around to find some of the lowest rates available in the industry, no matter what kind of bond you need.
Other Questions About Surety Bond Rates
Q: How does the bond amount affect my rate?
A: Surety bond rates are typically calculated as a percentage of the total bond amount. This percentage varies depending on the specific bond type. For example, notary public bonds are typically less than $10,000 whereas performance bonds can be for millions of dollars. Since the surety could lose a significant amount of money on bigger bonds, they charge higher surety bond rates to issue them.
Q: How will the underwriter calculate my surety bond rate?
A: Because surety providers offer a financial guarantee on your future work, they will carefully examine your application before issuing you a bond. During the underwriting process they might consider your work history, credit score, and other financial records to determine your reliability. Those with good credit scores generally pay lower fees for their bonds.
Although poor credit does not necessarily disqualify an applicant from getting a bond, some surety providers prefer not to work with those who might be financially unstable. Some surety providers do work with “high risk” applicants, but they will charge a significantly higher fee that could be anywhere from 5% to 20% of the total bond amount. The specialists at SuretyBonds.com do everything possible to assist every professional and business with their bonding needs for a reasonable cost.
Q: Does where I live affect my bond rate?
A: Because each bonding market has different regulations to meet, the jurisdiction in which the bond will be maintained could also affect your surety rate. For example, the bonding requirements for surety bonds in Missouri could differ from Florida surety bond requirements. So, if you run a nationwide business that needs a surety bond in multiple states, the surety bond rates could be calculated differently.
Q: Why does the bond’s risk affect my rate?
A: When a surety provider issues a bond, the underwriter provides a financial guarantee of the principal’s ability to meet the bond’s terms. The lower the risk, the lower the rate. A high number of claims have been made against certain professions, such as telemarketers and mortgage brokers, so the risk is naturally higher. Those applying for risky bonds should expect an extensive financial examination that could require a financial report audit and complete credit history review.
Q: How do my financial credentials affect my surety rate?
A: Before issuing a bond, surety providers will examine an applicant’s work, credit and financial histories to determine personal risk. Every time underwriters issue bonds to risky principals, they could lose money. So, when an applicant’s personal risk is high, the rate is typically high, too.