One of the first questions people ask when they are purchasing something is, “What does is cost?”. There is no exception when it comes to surety bond shopping. Unfortunately, bonds are really considered a form of credit and the same rate does not apply to all applicants. It is not that agents do want to give you a better idea of the costs of a bond, it is that they can not without applications being completed.

Usually, once a principal is told that bonds are really just a form of credit they respond with “My credit score is…What would the rate be for me?”. Most surety bond programs are not written exclusively on personal credit. Therefore, a rate can not be given from the owner’s personal credit information alone. Rates are typically underwritten based on, but not limited to: business financial statements for the company, personal financial statements for the owner(s), personal credit history of the owner(s) (not only the score), owner’s resumes, etc. For an agent to tell the principal the cost of the bond he/she would have to review a good amount of information.

Often, when a principal hears that they can not obtain a quote without completing applications, they want a ballpark figure. While a good agent can get an idea of where an applicant might fall, it is far from being accurate. For instance, a standard market rate for commercial surety bonds are around 1-3% of the amount of the bond. However, there are numerous factors that could put an applicant into a high risk market which is closer to 15% of the amount of the bond. As you can see, agents are hesitant to give a “ballpark figure” when the range is so large.

If you are a principal shopping for a bond let me give you this bit of advice. Do not simply complete applications for every agency you can find. Do some research, as the knowledge of agents varies by a frightening amount. Our industry is small, but still has it’s fair share of what I call “paper pushers”, rather than agents. An agent will review your file and submit it to a couple of bonding companies where he/she feels you will obtain the best rate for your unique situation. A “paper pusher” will simply submit your application to every surety they are appointed with. You might think that these paper pushers are doing you a service by submitting you to more companies, but they are doing quite the opposite. For one, some sureties will pull credit on a principal whether the agent submitted the application with a credit report or not. This could result in a long list of credit inquiries which could drastically effect the owner’s personal credit. Some bonding companies will also turn down principals if they receive the application from more than one agent. The sureties that practice this policy feel that the principals look desperate and do not feel comfortable extending them their surety credit. I am not saying you should only submit to one agent, but be sure to communicate with all agents involved that they are not the only agent. Also, be sure to find out what bonding companies each agent will be submitting to. These simple precautions could save you from tremendous headache down the road.

When looking for a surety bond, know that you will not be able to get a good idea of the cost until the agent is able to review your applications. Some agents may be willing to give you a ballpark figure, but keep in mind the ballpark is quite large in size and your actual quote can vary greatly. If you decide to use more than one agency, be sure you choose them wisely and keep communication as to what bonding companies the agents are submitting to.

About The Author
Michael Weisbrot is Vice-President of JW bond Consultants, Inc., a surety bond only agency.
You can find the original article, “What Does A Bond Cost?” and many other articles by Michael Weisbrot at the Surety Bond Blog.
jwsuretybonds.com

Share This

Your personal credit report score largely determines the rates you can
qualify for with most types of credit. The higher your score, the
better rates you can get. To find your score, you can request it from a credit monitoring service or credit reporting agency. Most credit monitoring companies will provide it free with an introductory offer, but you will have to pay for it from a reporting agency.

With hundreds of factors determining your credit score, there are many
ways
to improve it. The follow three are the quickest ways to boost your
numbers.

1. Pay Off Short Term Debt

The less debt you have, the better your score. Actually, creditors look
at
your debt to income ratio. They also rate debt differently. So credit
cards
are seen as more negative that college loans or a mortgage.

Focus on paying off short term debt first, like credit cards. Paying
off the
other debt can come later. However, having credit cards and making
regular
payments is better than having no credit.

2. Spread Debt Around

Not only do lenders look at your general debt load, they also consider
specific accounts. Maxing out any account is seen negatively. It is
better
to spread that debt around to multiple accounts. Most advisors suggest
having no more than 30% to 50% of a line of credit in use.

Be hesitant to open a new credit card account though if you are
planning to
apply for a mortgage or car loan. Opening new accounts can also
temporarily
hurt your score.

3. Close Newer Accounts

While you are looking at your credit report, consider closing some of
your
unused, newer accounts. The more credit you have available, the less
new
credit you can get - even if you aren’t using it. However, the longer
you
have an account, the better your credit score.

One way to get around this is to close accounts, then wait a couple of
months to apply for a loan. This will give time for your credit score
to
jump back.

There are no quick fixes to credit scores. Time and good credit habits
are
the surest ways of getting to good credit standing and low rates.

Here are our recommended companies for a
free copy of
your
credit
report and other credit rating resources.

Carrie Reeder is the owner of ABC
Loan
Guide, an informational website about various types of loans.

Share This

There is so much credit flying about these days, that keeping tabs on the credit you have and the credit you have had in the past, would be a full time job. That’s if you decided to apply your time to it. Not only that the threat of fraud being committed in your name is becoming a bigger and bigger problem, by the minute and could lead to many problems that could see you refused any credit in the future.

There is though a knight in shining armour riding to our rescue. It is in the form of the new CreditExpert Monitoring Service, which is a subscriber service and is being made available to us, by the UK’s biggest credit reference agency Experian. It is aimed to cut out any problems that could befall our finances.

It works by letting you know when any changes are made to your personal credit information that they hold on you. It also allows you to keep track of your own financial information at any time that you wish to do so. This means that you can have any details you need at the drop of a hat.

But the biggest and most valuable thing that it does for you in my opinion is the protection that offers you, in the fight against Identity Fraud. A major worry for all of us and it should be. By being able to go online, we can keep a close eye out for any discrepancies, which may take place on our credit report. Though to give you added security, the new service will alert you if anything changes on your report.

The only service of it’s kind in the UK. The CreditExpert Monitoring service will send you weekly alerts via, your E-mail address or by a SMS text to your mobile phone. Once you have received your alert, al you then have to do is get online and check your credit report for any changes that have come about. If any of the changes that you have been contacted about are of your knowledge, then you will be satisfied that your personal details are in good hands.

Though on the flip side of the coin, you find that the changes, such as a loan or credit card have been applied for in your name and it is not of your doing, then the online site will have all of the resources in which you can use to inform them that there may be fraudulent use of your name being committed. It will also be useful to check that the company you have applied for credit from has placed all of your personal information correctly, if not then you can use the service to inform the credit agency of any mistakes.

About The Author
Peter Kenny is a writer for creditcards-gb. For additional articles and an extensive resource for everything about credit cards, please visit us at http://www.creditcards-gb.co.uk and http://www.creditcards2go4.com.

Share This