Collection Agency Bond

A collection agency bond works like many other surety bonds — it ensures that a debt collection agency fulfills its contract in an ethical manner. This bond compels the agency to properly handle money it receives while pursuing outstanding debts. It also guarantees those funds are routed to the company with the debt outstanding (less any agreed-upon collection fees, which can total as much as 30%). Collection agency bonds are important to both debtors and indebted parties since both want to ensure any monies involved in the transaction are handled and transferred appropriately.

If the collection agency misappropriates these funds, the obligee can file a claim on the agency’s bond. If the claim is determined to be valid, the face value of the bond is released by the surety and paid by the collection agency.

Collection agency bonds are specifically required by the state in which the debt collector operates. These bonds are usually around $5,000, and as such are relatively inexpensive to acquire.

That said, before Surety Bond Services, Inc. can issue a bond, we must first verify that an agency has the funds and the financial strength to be able to pay the bond in full should a claim be filed against it. So, to obtain a collection agency bond, a completed application, favorable credit, and complete financial records are required.

For more information about Collection Agency Bonds, please contact our office at 866-385-7760.

Application Information

Complete the Commercial Application to get started. Please note: in addition to our commercial bond application, we may need to request the business and personal financial statements of the owner(s) and copy of any statute or ordinance that’s requiring the bond and/or a bond form.