Surety bonds are a special kind of bond that have special “fail-safes” associated with them so that it makes it much more difficult for anyone to commit fraud through acquiring a surety bond.
Unfortunately though, if you’re someone who doesn’t have a great credit score, it can make it very difficult for you to get a surety bond. Your credit score can become a tool that the bond issuing company uses to figure out how much should be charged for each of the surety bonds.
However, not every surety bond issuing company is going to close the door in your face if you have a lower credit score. Continue reading below to see how you can get a surety bond, even if you have bad credit.
What Is A Surety Bond And Why Do I Need It?
To have a better understanding of why it can be hard to get a surety bond if you have bad credit, it’s important to better understand the purpose that surety bonds serve. Surety bonds are intended to act as a form of insurance for you should anyone ever commit fraud in your name. While the bond company would pay the fees for this fraud at first, you would then have to pay back the surety bond company fully one day.
For this reason, bond companies tend to look at credit score as an indicator for whether or not you’d be able to pay back the surety bond. However past instances don’t always determine your future and you can work with certain bond companies to get a lower cost for what it takes to receive a surety bond.
How To Get A Surety Bond With Bad Credit
You may need to do some research on the various companies in your area that would be willing to work with you if you have lower credit. While you may be able to get a surety bond even if you have bad credit, many of the bond companies will attempt to charge you far more per month than they would if you had a decent credit score. This can make it difficult for you to fit a surety bond into your monthly budget.
Look for surety bond companies that would be willing to offer you a free quote for a bond that is based upon your credit score. This will give you a better idea of how much to budget each month and it will help you determine which company would be the best for you to work with based on what you hear back from the various quotes.
Searching more thoroughly for the price of quote that you need can help you, and your business, stay compliant. While it may not make sense that bond companies would be able to issue different quotes for the amount of surety bond that you’re looking for, it’s important to remember that bond companies, like all companies, have different resources from company to company.