Georgia Vapor Surety Bonds: What Are They?

Surety bonds are now required for many businesses that sell nicotine vapor products in the state of Georgia. If you’re a part of the vape industry, it’s vital to understand how Georgia vapor surety bonds work and how they affect your business. Rely on the team at Viking Bond Service for good information. 

When did Georgia Vapor Surety Bonds become mandatory?

The Georgia legislature passed a bill in July, 2020 mandating all sellers of vapor or other alternative nicotine products to have a surety bond valued at no less than $1,000 at all times. All new and existing vape shops, and many stores that sell vape products as part of a diverse inventory, will need a Georgia Vapor Bond. 

What is a Georgia Vapor Surety Bond?

This type of surety bond holds the bonded party (in this case the vapor seller) financially responsible if they violate Georgia state laws applicable to vapor sales. If the state agency responsible for regulating vape sales believes a business has violated any law, it may file a claim against the surety bond seeking financial compensation. The surety agency that issues and backs the bond will then launch an investigation to determine if the vapor seller did what they’re accused of in the claim. If so, the surety agency settles the claim in full without further delay. Surety bonds guarantee payment for valid claims – but the surety agency does not accept financial responsibility. When the surety agency settles a claim, the bonded party must pay that debt back in full with interest and fees added. 

Why did lawmakers create the Georgia Vapor Bond Requirements?

In the same year that lawmakers created the Georgia vapor bond requirements they also raised the taxes on vapor products and raised the age someone must be to buy vapor products from 18 to 21 – a wave of legislation meant to bring oversight and accountability to the Georgia vapor industry. Lawmakers often require business in sensitive or emerging industries to obtain surety bonds as a way to protect the public, encourage upstanding conduct, and hold businesses accountable for rule breaking. That same rationale applies here: lawmakers created Georgia vapor bond requirements to promote higher standards within the statewide vapor industry. 

How much will a Georgia Vapor Bond cost?

Not much. The cost (called the premium) is only a small percentage of the bond’s $1,000 value. Premium prices depend on the bond seeker’s credit score and financial history. People with great credit will pay less. Alternatively, someone with a credit score below 700 or a bankruptcy on their record will pay more, but not drastically so. Make sure bad credit doesn’t affect your ability to get approved for affordable surety bonds in Georgia – work with Viking Bond Service to find options regardless of your credit. 

Who Will Need a Georgia Vapor Bond?

Anyone involved with the sale of vapor-based nicotine products, either directly or indirectly, may potentially need a surety bond to continue operating legally. Fortunately, the cost of this bond is relatively low, as we established earlier. And with the help of a top-notch surety agency like Viking Bond Service, obtaining a surety bond doesn’t have to be a confusing or time-consuming process. If you’re unsure whether you need a surety bond, contact our team for more information. 

How to Apply for a Georgia Vapor Surety Bond

There are just several steps involved with applying for one of these surety bonds. First, you will need to complete a standard bond application. It will ask for information about your background, your finances, and your vapor sale business. Your business partners may also need to fill out surety bond applications. Next, you will need to supply a copy of the Georgia surety bond requirements written by state regulators. A financial statement may also be necessary, and all bond applicants will undergo a credit check. Underwriters at the surety agency will use this information to evaluate an applicant’s risk, meaning their likelihood to cause claims and to pay the surety agency back for settlements. As mentioned earlier, bad credit will lead to a higher quoted price. After paying the premium, the Georgia vapor bond stays active for 12 months before it needs to be renewed. The renewal process works much like the initial application: submitting some basic documentation and having your credit examined. If your credit standing has gone up or down since your last application, your premium price could do the same. 

Viking Bond Service – A Partner To Georgia Vapor Sellers

The Georgia vapor bond requirements may be new, but they don’t need to catch you and your business off-guard. The most important thing is to comply with this mandate sooner rather than later. Viking Bond Service makes that easy by offering all the resources you need along with a helpful team to serve you throughout the process. Talk to one of our bond experts by calling 1-888-278-7389 or by sending your question through the contact form on this page. Or get the bonding process started right now! Complete our online bond application at your convenience.

NY’s Debt Collector Surety Bond Requirements: What to Know

Big changes may be coming for New York state consumer debt collectors. Who, exactly, falls under that title? According to the New York Banking Superintendent, “Any person who engages in a business, a principal purpose of which is the collection of consumer debts or of debt buying, or who regularly collects or attempts to collect, directly or indirectly, consumer debts owed or due to another person.” If this definition applies to you, prepare for sweeping new legislation.

What is the current process for debt collection agencies in New York?

Licensing requirements already exist for debt collectors operating in some of the most populous parts of New York State: Buffalo, Yonkers, and New York City specifically. Unique licensing requirements exist in each municipality, including the requirement to obtain, in some cases, a specific type of surety bond known as a collection agency bond in a specific amount. A proposal included as part of the 2021 New state budget would require most if not all the consumer debt collectors in New York State to complete the requirements to obtain a license. Somewhat confusingly, this bill would not replace or supersede the existing municipal licensing laws. Rather, it would extend licensing requirements to debt collectors who operate outside of New York City, Yonkers, or Buffalo. As part of those licensing requirements, individuals would need to obtain a New York debt collector surety bond. 

What do surety bond requirements exist?

State governments and regulatory agencies use things like New York debt collector surety bond requirements as a means to regulate sensitive industries such as debt collection. This type of surety bond holds the bonded party (in this case the debt collector) financially responsible for violating state laws governing where, when, why, how, and to what extent someone may legally collect a consumer debt. If they violate those laws and it results in damages for an individual, that person or the state agency responsible for regulating debt collectors may file a claim against the surety bond seeking financial compensation equal to the damages. For example, if a debt collector manages to collect a larger sum than a debtor truly owes, the person negatively affected may file a claim for the extra amount paid. Provided that the claim proves to be true following an investigation, the surety agency that backs the bond automatically settles it in full. After settling, the surety agency uses whatever legal means available to collect the amount of the settlement from the bonded party – the party that accepts financial liability for all valid claims as part of the surety bond agreement. Surety bond requirements like the one proposed in the most recent state budget discourage unlawful and otherwise negative behaviors by making it impossible for offenders to escape the damage and financial consequences that result from their misconduct. 

Who are the parties involved in a New York State Debt Collector Surety Bond?

Surety bond contracts involve an agreement between three equal parties:

  • Principal – The bonded party who pays to obtain the surety bond and pays to settle valid claims. The principal is the debt collector
  • Obligee – The surety bond holder who writes the requirements and has the right to file claims for damages. The obligee is the state agency that regulates debt collection. 
  • Surety – The agency that issues the surety bond to the principal and guarantees payment for valid claims to the obligee. The surety agency is only an intermediary: whenever it pays to settle a claim the principal must pay that debt back with interest and fees added. 

How much will a New York State Debt Collector Surety Bond cost?

The changes proposed in the 2021 state budget would require debt collectors to have a $25,000 surety bond to obtain a license and keep that bond in good standing to maintain their license. The dollar amount attached to a surety bond refers to the maximum total a surety agency agrees to pay out in claims. However, the surety bond cost (called the premium), is a small percentage of the total bond value – meaning it may only cost a few thousand dollars to meet the proposed New York debt collector bond requirements. How much an individual debt collector pays depends on their credit score and financial history. Scores below 700 or financial blemishes like a bankruptcy will result in more expensive premiums. However, bad credit doesn’t have to result in a denial or an exorbitant price with the help of Viking Bond Service. 

What is the status on the bill?

It passed when the legislature approved the Governor’s 2021 budget bill. Henceforth, all debt collectors throughout New York state will need to obtain and maintain a surety bond as part of the professional licensing requirements. 

What’s the next step for debt collectors?

Since it’s now illegal for debt collectors to operate without a license or a surety bond, finding a surety agency to partner with is the next step. Find one that’s able to write New York debt collector surety bonds, which may be difficult since this type of bond is brand new. Applying for a surety bond involves completing an application, submitting a copy of the surety bond requirements, supplying a financial statement, and agreeing to a credit check. The surety agency will then quote a price for the premium. Upon receiving payment, the surety bond activates for 12 months, and the bonded party receives a document proving they’ve met the New York debt collector surety bond requirements. 

Viking Bond Service for New York Debt Collector Surety Bonds

Surety bond requirements shouldn’t be a hassle or a financial obstacle for New York debt collectors. That’s the philosophy of Viking Bond Service: A nationwide surety agency that moved quickly to start issuing New York debt collector surety bonds. Get yours by completing our online bond application. Or get more information first: you can call our team of bond experts at 1-888-278-7389 or contact us through the form on this page.

Vermont Marijuana Surety Bonds: What You Need to Know

Surety bonds play a large role in the emerging marijuana industry, in Vermont and across the country. If and when a business needs a Vermont marijuana bond to operate legally, problems with the surety bond could lead to serious problems with the business. That’s why it’s important for everyone involved with growing, processing, distributing, testing, and selling marijuana in the Evergreen State to understand how surety bonds work and what a Vermont cannabis bond might mean for their business. 

A Brief History of Vermont Marijuana Laws

Like most other states of the era, Vermont banned cultivation, sale, and usage of marijuana in 1915. That ban stood for decades until Vermont became one of the earliest states to pass laws permitting medical marijuana. Decriminalization followed in 2013, and seven years later Vermont a bill to legalize recreational marijuana sales in 2020. Notably, Vermont was the first state to authorize adult marijuana use through the state legislature rather than through a ballot initiative. 

Who can legally sell medical or recreational marijuana in Vermont?

At the time of writing, Vermont was still working out the details of how it will tax and regulate recreational marijuana sales. However, it’s all but certain that businesses involved will need a state license. Among the requirements for getting a Vermont marijuana license could be the need for a surety bond. This has been the trend in other states, with overall positive results, and there’s no reason to think Vermont will proceed differently. 

Why do businesses need a Vermont Cannabis Bond?

Vermont marijuana bonds are just one example of a type of surety bond known as a license bond. Many professionals need to obtain a license to operate their business legally. All states require people seeking certain types of licenses to obtain a surety bond first. The reason is that surety bonds protect the public at large and the regulators responsible for individual industries from the risks created by unlawful or unethical businesses. 

To understand how and why, it helps to quickly rundown how surety bonds work. If a marijuana-related business breaks Vermont state laws relevant to the industry, any parties hurt by those actions may file a claim for damages against the surety bond. They are guaranteed payment by the surety agency that backs the bond provided that everything in the claim is true. After paying, the surety agency directs their focus to collecting the amount of the settlement, plus interest and fees, from the bonded party, in this case the marijuana-related business. Under the surety bond agreement, the bonded party has financial liability for all valid claims. The surety agency guarantees injured parties receive payment, but they never accept financial liability. Essentially, surety bonds hold the bonded party accountable for their mistakes. 

Which is why Vermont and other states use them to regulate a number of different industries. Surety bonds create a financial disincentive for businesses to break the law or exploit the public. They also create a mechanism through which anyone affected by misconduct can pursue, and likely receive, financial compensation proportional to the damage caused. Ultimately, surety bonds are good for all involved because a trustworthy marijuana industry where bad actors are held responsible can only lead to higher sales for marijuana businesses. 

Who are the parties involved in a Vermont Marijuana Bond?

Unlike insurance or loan agreements that typically involve just two parties, all surety bond agreements involve three:

  • Principal – The bonded party, responsible for obtaining the surety bond and paying for all claims. 
  • Obligee – The surety bond holder, responsible for writing the surety bond requirements and given the right to file claims.
  • Surety – The surety bond agency, issuing bonds to the principal and settling claims with the obligee. When the surety settles, the principal must repay the debt. 

How much does a Vermont Cannabis Bond cost?

Everyone pays a different price for a Vermont marijuana bond. The cost (called the premium) depends first on the type of marijuana bond: different aspects of the marijuana industry (testing facilities vs dispensaries etc.) will have different bonding requirements. As part of those requirements, state regulators will define how large a Vermont cannabis bond someone needs to obtain – eg. a $10,000 bond or a $25,000 bond. The dollar amount refers to the maximum amount the surety agrees to pay out in claims. Premiums are only a small percentage of that maximum amount, meaning a Vermont marijuana bond valued at $10,000 might cost just a few hundred dollars to obtain. The surety bond applicant’s credit score and financial history determine the exact premium cost. People with bad credit will typically pay more – but with the right surety agency in their corner, one like Viking Bond Service, they won’t be denied a bond or even asked to pay substantially more. 

Why Viking Bond Service for Vermont Marijuana Bonds?

Viking Bond Service is a partner to all businesses involved with the Vermont marijuana industry. We have the resources to make bonding fast, simple, and affordable for everyone we work with. To get a quote for a Vermont marijuana bond is as little as 24 hours, submit an online bond application at your convenience. If you have questions or need more information, our team is eager to help – contact us through the form on this page or call us at 1-888-278-7389.

What to Have When Applying for a Performance Bond

performance bond holds a contractor or construction company financially accountable when it fails to meet the performance standards outlined in a contact. For example, if a contract specifies that work must be complete by a certain date and it’s not, the project owner may file a claim against the performance bond seeking compensation for damages resulting from the missed deadline. Project owners often include performance bond requirements in work contacts to protect themselves from the risk of contractors who don’t live up to expectations. If you frequently bid on construction projects, you will likely need performance bonds multiple times throughout your career. They’re an integral part of your business, and something you can’t bring in revenue without. Given the stakes, it’s important to understand the performance bond basics and secure a performance bond as soon as possible if and when project owners require one. Avoid unnecessary setbacks and delays by preparing all the necessary documentation in advance. Here’s what you will need:

Financial statements

Expect any surety agency you apply for a performance bond with to ask for some level of financial statements. The size of the bond will generally dictate how extensive the requirement for financial statements will be. For smaller bonds they surety may only need a glimpse into the principal’s financial picture. For larger or higher risk bonds the surety may ask for multi-year and/or CPA involved statements. Your contract bond specialist at Viking will be able to guide you through this process. These statements are a formal record of business activities over a one-year period and they provide objective evidence of that business’s strengths and weaknesses – which is exactly why surety agencies ask for them. When you apply for a performance bond, underwriters (risk assessors) inside the surety agency go through a careful process to evaluate how likely you are to underperform, cause claims, and leave debts unpaid. One way they make that determination is by looking at your business’s past record and future prospects. If your business is less than two-years old or you are otherwise unable to provide the required financial statements, speak to the surety agency about a possible alternative. 

Copy of the contract that the performance bond is linked to

Another way that underwriters evaluate risk is by examining the terms of the contract the performance bond is linked to and then comparing that to the resources of your company. To return to our previous example, if a contract called for a specific completion date that a contractor clearly lacked the staff or equipment to meet, that would make a bond seeker especially risky and give surety agencies second thoughts about bonding them. Be prepared to provide a full copy of the contact, including the exact language of the performance bond requirement and the details of performance mandated. 

Application with the surety company

With performance bonds as with all other types of surety bonds, you will need to complete a standard bond application. Anyone else with an ownership interest in the business will need to complete an application as well. Be ready to supply details about your background, finances, and business interests. In most cases, applications take just a few minutes to complete. 

Real estate or other collateral owned by the contractor

Depending on the surety agency you work with and the specifics of the project you need a bond for, collateral may be involved. Collateral works like a security deposit – you put up something valuable upfront which the surety agency can use to settle claims or return to you if no claims are filed. The surety agency will decide what kind of collateral it will accept. Real estate is the most common form, but other valuable fixed assets like heavy equipment may also suffice. A certificate of deposit or irrevocable letter of credit might also be acceptable. Keep in mind that not all performance bond requirements stipulate collateral, and even when they do, the collateral costs you nothing as long as you avoid claims. 

Viking Bond Service – Performance Bond Specialists

If you need a performance bond, you likely need other surety bonds commonly associated with construction projects: bid bonds, warranty bonds, supply bonds, payment bonds, subdivision bonds and the list goes on. The point is, bonding plays a big role in your business. That’s why you need a reliable bond partner. 

Viking Bond Service is a nationwide surety agency issuing performance bonds along with all other construction bonds. Count on us to offer the bond you need. We also work with bond applicants who have bad credit and often find them competitive rates when other agencies have turned them down. We strive to make bonding fast, easy and affordable for everyone we work with – the first time and every time after. That’s how we’ve become the go-to surety bond source for contractors across the country. 

Are you ready to get a performance bond now? If so, get started on the online application. Do you have questions or need more information first? Our team is here to help – contact us through the form on this page or speak directly to a surety bond specialist at 1-888-278-7389.

Important Documentation Needed to Get a Surety Bond

You may need to get a surety bond before finalizing a contract, earning a professional license, or starting a business. In all cases, speed matters. You can’t accomplish your objective until you can prove you have the necessary surety bond. Therefore, you need to learn the surety bond requirements and complete the surety bond application process without delay. Learn how to get a surety bond and avoid unnecessary obstacles and setbacks by getting all the surety bond documents you will need in advance:

Financial Statements

Financial statements help underwriters (risk assessors) at the surety company evaluate your past and present financial situation. Underwriter’s whole goal is to decide how likely a surety bond applicant is to cause claims against the surety bond and how likely they are to pay the surety company back for those claims. Financial statements, along with the rest of the documents on this list, help to make that determination accurately. 

For businesses with under $20 million in revenue, you will need to provide a financial statement from the previous year (a tax return will not suffice) including an income/balance sheet and a schedule of receivables and deliverables. Underwriters will also need an ongoing compilation for the current year to evaluate your financial position at the same moment when seeking a bond. 

In addition to the financial statement for the company, underwriters will need financial statements from the major shareholders, evidence of business and personal tax filings at the state and federal levels, and a bank statement and letter of reference from the bank.

Businesses with revenues over $20 million can, in most cases, provide just a copy of a reviewed or audited financial statement from the previous year. 

Bond Agent Questionnaire

As part of the surety bonding process, every surety bond agent develops a questionnaire to get a better understanding of bond applicants. The questions are always different, but usually they ask for a Tax ID number, the state of incorporation, and the current number of employees. 

References

When applying for a surety bond, references give underwriters independent confirmation that your business is trustworthy and in good standing. If someone offers to write you a reference, the thinking goes, then your business must be capable of meeting expectations and delivering satisfactory work. To a certain degree, the contents of the reference matter less than your ability to obtain one. A business that couldn’t find anyone to refer them would be a large red flag for underwriters. It can take a while to get the references you need, so make this part of the surety bond process your first priority. Send a reference request to your most enthusiastic customers/suppliers, then get started on everything else while you wait for the response. 

Certificate of Insurance

You will need to ask your insurance company for a certificate of insurance (COI). This document certifies that you have the insurance coverage mandated in the work contract or under the license agreement. Here again, underwriters use this document to establish whether your business works within the boundaries of the law – suggesting you will also work within boundaries of the surety bond requirements.

Work in Progress (WIP) Form

Underwriters are trying to evaluate the strength and sustainability of your business overall. But they also need to investigate whether you have the resources to complete specific projects. After all, a company with a sterling track record could quickly become overleveraged and start breaking contacts and generating surety bond claims. A work in progress form details all the jobs you’re working on now, all the jobs you have in the pipeline, and all the jobs completed over the previous year. Include details of any other surety bonds you have as well. 

Resumes for Key Personnel

All it takes is one employee to do something that leads to a claim on the surety bond. To get a closer look at your employees, particularly those in leadership or project management positions, underwriters may ask for resumes from key personnel. This requirement isn’t a universal part of the surety bond process, but it’s something you should be willing and prepared to provide. Include a full employment history in each resume along with any notable credentials and accomplishments. 

Viking Bond Service – Your Surety Agency

As you can see, it may take a day or two (or longer) to prepare all the necessary documentation. Make sure to get started as early as you can to account for any setbacks. Just as important, make sure to work with a surety agency that makes applying easy, efficient, and extra fast. 

Viking Bond Service removes the roadblocks and speeds up the surety bond process so that you don’t have to waste time waiting to get a surety bond. When you apply, you will typically receive a quote within 24 hours. Pay the premium and then your surety bond requirement is met! Our underwriters will ask for some or all of the documents outlined above, but we use a simple, straightforward process that’s open to applicants regardless of bad credit

If you have questions about specific surety bond requirements or about the surety bond process overall, our team has answers. Contact our surety bond experts and get expert information at no cost or obligation to you. Submit your questions through the contact form on this page, or speak directly to a team member by calling 1-888-278-7389.

Florida Auto Dealers: Why You Should Renew Your Bond Now

Bond renewal season is upon us. If you’re an auto dealer in Florida, you will likely receive a bond renewal notification sometime in December. Maybe this is the first time you’ve renewed a Florida motor vehicle dealer bond or maybe it’s the 40th time. Either way, you need to act fast to get the renewal process started. 

Auto Dealer Bond in Florida: Why Renewals Matter

If you’re like most motor vehicle dealers in Florida, you only think about your surety bond once a year – when the renewal notice comes. Much like insurance, unless you’re having issues related to the surety bond, it’s not something that requires much time and attention. Also like insurance, a Florida motor vehicle dealer bond is something every business involved with auto sales must have to continue operating legally. To put it differently, surety bonds may not consume much of your time or attention – but they’re critical to the success of your business. 

As you might remember from the early days of your auto dealership, Florida requires anyone seeking an auto dealer’s license to prove they have an auto dealer bond and to keep the bond active and in good standing for as long as they remain licensed. Failure to renew a bond on time or at all would violate the terms of licensure and, potentially, lead to a loss of license. Continuing to sell vehicles without a license would mean fines and fees at best, but it could lead to a permanent loss of license and even jail time in extreme circumstances. To make the stakes starkly clear: Missing a bond renewal could lead to the permanent end of an auto dealership. 

When to Renew an Auto Dealer Bond in Florida

Going even one day without the required surety bond exposes a car dealership to risk and liability. That’s why surety agencies send out renewal notices well in advance of the surety bond’s expiration date (at least the good agencies do). Whenever that renewal notice arrives – which for many auto dealers is at the end of the year), don’t throw it in a stack of things to deal with later. Instead, start the renewal process ASAP, ideally immediately. Frankly, surety bond renewals are easy to forget about in the hustle and bustle of a business, but the risk of a missed renewal is too high to ignore. If you’re reading this now, it’s probably a good time to get the renewal process rolling.

How to Renew an Auto Dealer Bond in Florida

Renewing a surety bond works largely the same as obtaining one in the first place. But it also works differently than many people expect. Rather than paying the same premium you did the previous year or paying a standard renewal fee to keep the bond active, you will pay a new premium based on any changes to your credit or business standing over the previous 12 months. 

It works like this: After receiving your surety bond renewal notice, you will fill out a standard bond application with information about your background, finances, and business interests. Anyone else with an ownership stake in the business will also need to complete an application. Then, based on the application(s) and the results of a credit check, underwriters at the surety agency will assess the risk of bonding you and calculate a custom premium price. If your credit score has declined, you will likely pay more than you did last year, but the reverse is true if your credit has improved. 

Once you pay the new premium price, the Florida motor vehicle dealer bond renews for another 12 months. You will then receive a document to prove you have an active surety bond when renewing your auto dealership license. Without this document, license renewal isn’t possible. 

Viking Bond Service – A Partner to Florida Auto Dealers

If you currently rely on Viking Bond Service for an auto dealer bond in Florida, expect the renewal process to be fast, simple, and straightforward. We’ve spent a long time fine-tuning this process with feedback from users. If you have a surety bond through another agency, keep in mind that you don’t have to renew – you also have the option to let the bond lapse while switching to work with a different provider. 

Viking Bond Service issues every variety of auto dealer bond in Florida and works with vehicle sellers in all parts of the state. Unlike many other surety agencies, we also go above and beyond to serve bond seekers with bad credit. Count on our service-oriented team to make obtaining or renewing the exact bond you need a painless process. 

If you have questions about renewing surety bonds or switching surety bond agencies, we have the answers. Contact us through the form on this page or by calling 1-888-278-7389.

Different Types of Contract Bonds

There are many different types of contract bonds, and even though they all share the same basic mechanics, each one works a little differently. In this blog post, we will run down the most common types of contract bonds and show you where to find more information about them all.

What is a Contract Bond?

A contract bond is basically a way to hold someone accountable when they violate the terms of a contract. When that happens, the other party in the contact may file a claim against the contract surety bond. As long as the claim is true – meaning the party at fault violated the contract as the claim asserts – the surety company that backs the bond pays to settle the claim. Under the terms of the bond agreement, the party that caused the claim by violating the contract has the final financial responsibility for all claims. Therefore, even if they have been unable or unwilling to pay for claims before, they must pay the surety back for any settlement. Contract bonds are a way to hold one party responsible for violating a contract and provide the other party a guaranteed way to seek damages. 

What are the Different Types of Contract Bonds

Contract bond is a blanket term used to describe many different types of bonds in construction contracts or other industries. Bond seekers commonly need multiple types of contact bonds at once, and need different packages of bonds throughout their career. Common types of contract bonds include:

  • Bid BondsThese bonds hold someone accountable if they win a bid to complete a construction project and then pull out of the project before it begins. 
  • Construction BondsThis is another catchall term for a suite of contract bonds. Before starting a new project, contractors and construction companies often need to obtain all of these bonds: bid bonds, performance bonds, payment bonds, and (possibly) warranty maintenance bonds. 
  • Payment BondsIf someone fails to pay their suppliers or third-party contractors, the injured parties can file a claim against this bond to recoup lost payment. 
  • Performance BondsWhen a contractor or construction company fails to meet performance standards mandated in a contract – to finish by a certain date, to keep costs below a specific threshold, to maintain precise quality standards etc. – these bonds allow the other party in the contact to seek damages. 
  • SBA Bond Guarantee ProgramThis isn’t a type of contract bond but rather a program from the Small Business Administration (SBA) that helps entrepreneurs secure bonds they couldn’t have otherwise. 
  • Subdivision BondContractors hired to perform work inside of a subdivision may need one of these bonds, which hold contractors liable when their work falls short of expectations. A subdivision bond can also be called a developer bond, land improvement bond, or plant bond. 
  • Site Improvement BondSimilar to a subdivision bond, a contractor may need a site improvement bond before performing work on an existing land site. The bond protects the site owner from a contractor’s faulty work. 
  • Supply BondCompanies that supply goods and materials for construction projects may require this bond, which holds them responsible if a delivery of goods is not up to standards.  
  • Timber Sales BondIf a company intends to clear lumber from public land, they will need a timber sales bond stating they will take responsibility if their actions step outside the boundaries of a contract. 
  • Warranty/Maintenance BondThis bond applies to contractors and construction companies that agree to provide ongoing maintenance services or warranty protections. If they fail to deliver as promised, the other party may seek damages through the bond. 

Who should get a Contract Bond? 

Anyone required to do so according to the terms of a contract. When a contract requires a bond, the agreement isn’t final until the principal (the party required to get the bond) proves it has met the requirement. Different types of bonds in construction contracts can make or break a deal, so it’s crucial to comply with the bond requirement. As a nationwide surety brokerage issuing all types of contract bonds (including all the types outlined above), we can help you meet your bond requirements fast and in full. 

How to Apply for Different Types of Contract Bonds? 

In all cases, applicants must fill out a standard bond application, submit to a credit check, and supply a copy of the bond requirements specified in the contract – plus turn over any additional documentation the surety asks for. The surety will then quote a price for the bond, which the principal needs to pay to activate the bond. 

Viking Bond Service – Your Source for Contract Bonds

Rely on Viking Bond Service for any and all of your contact bonds. We can quote you a price in just 24 hours, and we are happy to work with bond seekers who have bad credit. Count on us to streamline the bond process and get everyone a competitive rate. Request a quote at your convenience. Or speak to one of our bond experts by calling 1-888-278-7389 or by sending your questions through the contact form on this page. 

Small Contract Performance Bonds and Payment Bonds – Good & Bad Credit

How can I get a surety bond with bad credit? That’s a question we hear a lot. Plenty of people have less-than-stellar credit, often because of mistakes that happened a long time ago. Nonetheless, many surety bond companies won’t work with applicants who have bad credit. Making matters worse, being unable to get a surety bond makes it difficult and often impossible for a contractor to win bids and find work. This becomes a vicious cycle where past financial mistakes make it harder to build a sound financial future. Fortunately, it doesn’t have to be this way. Some companies offer a bad credit surety bond program specifically for people who have a credit score below 700 or something like a bankruptcy on their record. No matter what your current credit is like, read this blog to understand how it will affect your ability to get bonded and what you will pay for that privilege. 

Why Do Surety Bonds Require a Credit Check?

To answer that question, it helps to understand how surety bonds work in the context of a contract performance bond. When a contractor gets hired to perform a job, contact performance bonds hold him financially accountable if he fails to meet performance standards (for time, cost, quality etc.) established in the work contact. If the contractor can’t or won’t accept that financial responsibility, the surety company that issues and backs the bond agrees to pay for any valid claims for damages – after which the bonded party (the contractor) must pay for the damages plus interest and fees. 

A surety company runs a credit check to help determine how likely a bond applicant is to engage in behaviors that could lead to claims on the bond. The surety is also trying to determine whether a contractor will pay for those claims, either immediately or after the surety steps in to pay. Essentially, the surety uses the credit check to gauge the risk of approving someone for a bond. Credit checks aren’t a perfect indicator, though, because many people with bad credit are financially responsible as well. That’s why some surety companies like Viking Bond Service have a bad credit surety bond program designed to help more people get the bonds they need regardless of their credit. 

How to Avoid Paying Too Much 

When deciding how much is too much to pay for a surety bond, keep in mind that surety bonds are essential business expenses. In the same way that contractors require tools and materials to complete a job, they require a bond, and if they don’t have one they can’t secure any business. Seasoned contactors understand this, plan for the bond costs, and then work these costs into the bids they submit for jobs. 

The best way to avoid paying too much, especially if you have less-than-perfect credit, is to work with the right surety bond provider. Every company is different. Some are more tolerant of risk than others, and each interprets a bond applicant’s credit score and financial history differently. You could apply for various kinds of contract performance bonds and payment bonds, specifically the trio contractors need for most jobs (bid, performance, and payment bonds), with multiple companies and compare the various offers. But that would be a lengthy process, and when you’re trying to win a bid, time is of the essence. The better move is to work with Viking Bond Service – a nationwide surety brokerage offering what’s known in the industry as a bad credit surety bond.

For all intents and purposes, a bad credit surety bond is just like any other surety bond. The only difference is that the applicant has bad credit and may have been denied a bond by other providers. At Viking Bond Service, we use our coast-to-coast connections, years of experience, and abundant resources to help more contractors get the bonds they require at affordable, competitive rates. Working with the right surety bond provider is the single best thing you can do to keep bonding costs in check. And if you think you’re paying too much with your current provider, investigate how much you could potentially save by switching. 

How to apply for Small Contract Performance Bonds and Payment Bonds?

If you need bonds to complete a contract valued at less than $350,000, applying is easy. You will submit a bond application, which takes only a few minutes to complete and asks for information about your background, business interests, and financial strength. You will also need to submit to a credit check and turn over any other documentation the underwriters (risk assessors) need to evaluate your bond worthiness. Based on that information, they will quote you a price for the bond premium. Having bad credit will mean paying a higher premium, but not exorbitantly high. Applicants with good or bad credit will both pay a small percentage of the total bond amount. 

Viking Bond Service – Our Bad Credit Surety Bond Program

There’s a reason contractors in all 50 states make Viking Bond Service their go-to bond partner. Unlike other bond providers, we make a real effort to make bonding fast, easy, and affordable for everyone we work with. If you have questions about surety bonds or your credit, get immediate answers from one of our bond experts – call 1-888-278-7389 or submit your question through the contact form on this page. You can also apply for a bad credit surety bond at any time, and expect to receive a quote in under 24 hours. Complete this online application!

What to know about Alabama’s New Motor Vehicle Surety Requirement

Alabama motor vehicle dealers need to be aware of a major change to the state’s surety bond requirement. New rules will affect how much dealers pay to secure and renew a bond they must have in order to legally sell vehicles. More importantly, the changes to the Alabama motor vehicle surety bond requirement will create greater liabilities for dealers should anyone ever file a claim against the bond. The experts at Viking Bond Service are here to show you exactly how these changes affect you, your business, and your surety bond. 

What is a Motor Vehicle Dealer Bond?

It’s worth reviewing how an Alabama motor vehicle surety bond works before describing the new requirements now in effect. Alabama – like all states – requires motor vehicle dealers to have a license in order to run their business legally. As part of the license requirements, dealers must obtain an Alabama motor vehicle surety bond. Failure to obtain a bond makes it impossible to receive a license. Likewise, dealers who let their bond lapse are at risk of losing their license as well. 

This type of surety bond – known as a license bond or commercial bond – holds a motor vehicle dealer accountable if he breaks Alabama state laws applicable to vehicle sales – selling a lemon, for example. Vehicle buyers wronged by a dealer may file a claim against the motor vehicle dealer bond seeking compensation equal to whatever they lost because of the dealer’s illegal behavior.

After receiving a claim, the surety company that issues the bond launches an investigation to determine whether the claim is true. If so, the surety automatically settles the claim in full – guaranteeing that anyone affected by an unlawful vehicle seller can get restitution. After paying, the surety will collect the amount of the claim plus interest and fees from the motor vehicle dealer. The bond agreement holds the principal (the bonded party, in this case the dealer) responsible for all valid claims. 

What are the new requirements of the state of Alabama motor vehicle dealer bond 

Previously, Alabama required all motor vehicle dealers to have a surety bond valued at $25,000 – meaning the surety company that backed the bond agreed to pay up to that amount to settle claims. Beginning October 2020, dealers will need a State of Alabama motor vehicle dealer bond valued at $50,000. Keep in mind that these are minimum amounts. The state assigns bonding requirements on a case by case basis and may require some dealers to have a larger bond. However, all dealers will need twice the bond they had before – which will have long-term implications for their finances we will discuss in the next section. 

How much will the Alabama motor vehicle surety bond cost?

The amount someone pays for a surety bond is a small fraction of the bond’s total value, starting at 1%. That means before the changes to the motor vehicle dealer bond requirement, a dealer paid as little as $250 to meet the state bond requirement. Now that the bond requirement has doubled, the premium has too. Dealers will pay at least $500 to obtain the necessary surety bond, and at least that amount to renew the bond on an annual basis. Exactly how much someone pays depends on their credit, background, and business standing. Premiums for these bonds could cost north of four figures. Dealers will need to plan for the added expense as part of their annual budget. They will also need to make extra effort to prevent any circumstances that could lead to a claim on the bond – which could be as much as $50,000 a dealer must pay back in addition to interest and fees. 

How to apply for an Alabama motor vehicle surety bond

ALL motor vehicle dealers in Alabama will need to apply for a new surety bond to comply with the state’s expanded bonding requirements – even if you have an active bond already. Since an active bond will not cover the amount now required by the state, everyone must seek out a larger bond than they currently have. To apply, dealers will need to complete a standard bond application, submit to a credit check, and supply any additional documentation the surety asks for. This is also an ideal time to explore whether a new bonding provider could offer more competitive rates or superior service. 

Viking Bond Service – Serving All of Alabama

If you’re someone who requires an Alabama motor vehicle dealer bond, you need to act fast to comply with the changes to state law. As a leading surety bond provider, Viking Bond Service is here to help. Speak to one of our bond experts at 1-888-278-7389 to ask questions, or submit them through the contact form on this page. Or get the bonding process started today. Fill out this online bond application, and expect a quote within 24 hours. 

Everything You Need to Know About Reclamation Bonds

If you’re involved with mining work, you may require a reclamation bond at some point. More likely, you will require this kind of commercial bond multiple times throughout your career. While this is certainly not an all-inclusive list, here are some common land use types that require reclamation bonds to be in place:

·         Surface mining of all types

·         Oil well drilling and plugging

·         Recycling facilities of all types

·         Storage of hazardous materials

Therefore, it’s important to understand how reclamation bonds work, how they affect your business, and why you need to take the bonding process seriously. In this blog, we will outline everything you need to know about reclamation bonds. 

What is a Reclamation Bond?

In the simplest terms possible, a reclamation bond is a guarantee that a mining company will restore any land it mines to either the original state or to a condition stipulated in the mining contract. If the contractor fails to restore the land as required, the reclamation surety bond holds the contactors financially responsible. 

Like all kinds of surety bonds, reclamation bonds provide a mechanism for one party to hold another party accountable for unethical or unlawful behavior. The wronged party may file a claim against the surety bond seeking damages. The company that issues the bond will then investigate the claim. Provided that the claim is true, the surety company pays for it in full. Lastly, the surety collects the amount of the claim plus interest and fees from the party that has financial responsibility under the bond agreement (in this case the mining company). By entering into a bond agreement, it becomes impossible for a mining company to abandon its responsibility after a mining project concludes. 

Why Get a Reclamation Bond?

Most mining contracts require a company to get bonded before they’re allowed to break any ground. When required, there’s no wiggle room. Contractors will need to prove they have a bond before they’re awarded a contract, and they will need to keep that bond active for as long as the contract stipulates. The mining company bears the full financial cost of the bonding process, but it’s a necessary business expense since these bonds are more or less mandatory for mining projects. If you require a reclamation surety bond, work with Viking Bond Service to get a fully compliant bond at competitive rates in almost no time at all. 

Requirements for a Reclamation Bond?

The requirements vary depending on the applicant and the size of the bond. In some cases, applicants must put up collateral equal to some or all of the bond amount. For example, a $100,000 bond may require $50,000 in collateral. But the collateral requirement isn’t universal, and if you work with the right surety bond provider you’re less likely to face a collateral requirement. The only other requirement is that you pay the premium to activate the reclamation bond. Expert the premiums to cost a small percentage of the total bond amount, typically less than 10% of the total. Exact amounts depend on the applicant’s credit. Some surety companies will deny an applicant with bad credit, putting his or her mining business in serious jeopardy. Viking Bond Service isn’t one of those companies – we do everything possible to approve applicant’s even if they have bad credit

Who are the Parties Involved in a Reclamation Bond?

The mining company is one of three parties involved in the surety bond agreement:

  • Principal The mining company that pays to get bonded and pays to settle claims filed against the bond. 
  • Obligee The government agency responsible for land where mining occurs. The obligee has the right to file a claim for financial compensation to recoup the cost of land mistreated by mining companies.  
  • Surety The company that issues the reclamation surety bond and agrees to settle any claims if the principal can’t or won’t settle. When the surety pays, however, the principal must pay that amount back in full. 

How to Apply for a Reclamation Bond?

The underwriting process takes longer for reclamation bonds than some other kinds of bonds because they’re non-cancellable – meaning the bonds stay active for years (during and after a mining project). The surety company accepts a lot of risk with this type of surety bond, so they take their time evaluating applicants, and many require collateral as well. To apply, you will need to submit a bond application, a financial statement, and anything else the surety company requests. Work with Viking Bond Service to make the application process easy and efficient. 

Viking Bond Service – Reclamation Bond Experts 

It shouldn’t be a hassle to get bonded. That’s why people work with Viking Bond Service. As a nationwide surety brokerage, we issue reclamation bonds in all 50 states at competitive rates. For more information, contact our team directly at 1-888-278-7389 or through the contact form on this page. You can also get the application process started now by completing this online application