Increased Car Wash Bond in California as of January 2014

From $15,000 to $150,000. That’s the surety bond increase that car washes in California are facing from January 1, 2014.

If you are running a car wash business, the useful information below can help you figure out what the legislation change is about and how to cope with the new bonding requirement.

Car wash
Car wash
howardignatius / Flickr / CC BY

 

Legislation changes

The significant surety bond increase comes as a result of the passing of the AB 1387 bill last year. Among other changes, it also alters some sections of California’s Labor Code. This touches upon car wash and automatic car wash employer’s surety bond requirements, replacing all old legislation in the field.

According to the new bill, the surety bond is not needed in cases when the employer has signed a collective bargaining agreement that sets wages, work hours, working conditions and a procedure for cases of wage non-payment.

The new rule also defines the car wash registration requirement as permanent.

 

Car wash bonds

Car washing and polishing businesses need to register with the Labor Commissioner in California in order to run their activities legally. Car wash owners need to obtain a California car wash employer’s surety bond as a part of the registration certificate procedure.

The car wash bond is a type of commercial surety bond. It acts as a guarantee that the owner will abide by the labor law and make the necessary payments to all employees. Thus, it is a protection for car wash and polishing services personnel.

Car wash employees
Car wash employees
cradlehall / Flickr / CC BY

The surety bond is posted by the principal, in this case a car wash, to guarantee to the obligee demanding the bond, the State of California Division of Labor Standards Enforcement, that this business will follow the state rules in its operations. The surety that underwrites the bond guarantees that the principal will follow its obligations to the obligee.

 

Getting bonded in California

While the increase is certainly a challenge for many car wash owners, getting bonded, even with far-from-perfect credit can be made easier if you choose the right surety bond agency.

The price of the surety bond is a percentage of the $150,000 bond amount. Rates vary depending on the specific financial and business situation of the car wash. Businesses perceived to be a higher risk may face higher prices in the bonding process.

Obtaining a surety bond can be difficult if your financial status is not good, as many surety agencies examine a variety of factors during the bonding process. However, other agencies such as JW Surety Bonds focus only on the personal credit score.  Higher risk bonding is possible at JW Surety due to our large business volume, which allows flexibility in the bonding process.  You can get an online quote with ease.

Contractor license bonds: a beginners’ guide

Surety bonds can be a puzzling subject to many people. Then again, there are a few simple distinctions that can help you greatly when you start operating as a contractor and need to obtain specific bonds for specific purposes. Let’s tackle contractor license bonds.

It’s very easy to confuse contractor license bonds with contractor bonds such as bid, performance and payment bonds. However, there is a clear difference between them. Contractor license bonds are blanket bonds that guarantee the contractor’s operation in a specific area. Contract bonds, on the other hand, are project-specific and fall into a different bond category.

Contractor bonds

Construction in Vegas

Contractor bonds are required for the particular project in question.

For example, during the bidding process for a project, a contractor might need to provide a bid bond. The bid bond guarantees that if the contractor is granted the contract, he will obtain the next necessary bond – a performance bond. This bond is a guarantee for compliance with the contractual obligation and for completion of the project.

Finally, a payment bond is a security for subcontractors and suppliers that the main contractor will fulfill their obligations for payment of services and supplies down the chain.

 

Contractor license bonds

And now we come to the heart of the matter. What, then, are contractor license bonds? First of all, they are not related to any specific construction project. Instead, they are a general license requirement that contractors need to meet in order to operate legally in a certain geographical area.

How to get a contractor license bond

 

The license bonds are a guarantee to the local municipality or state that the contractor will abide by the relevant laws in this area. Depending on the location, the contractor might need license bonds for both local and state authorities.

Some contractor license bonds are a guarantee solely for abiding by local regulations. There are other contractor license bonds that include requirements for performance and payment as well. These relate to the completion of projects as well as diligent payment to subcontractors.

 

Getting bonded

The contractor license bond is a requirement in the licensing process to become a legal contractor operating in a certain location, whether state, county or municipality. First, you need to get the licensing packet containing details of all relevant requirements. Then you have to obtain the license bond through a bonding agency such as JW Surety Bonds that covers the kind of operations you would like to perform in this area.

Contractors with bad credit are able to get bonded through JW Surety Bonds’ high risk markets. The bonding costs might be higher, as poor credit history reflects a higher risk to the surety. Unlike other agencies that consider a variety of financial and experience factors, we only review the personal credit score which means a broader range of clients can get their bonding with us.

You can get an instant free estimate of the surety bond costs or get a detailed quote.

Once you differentiate clearly between contractor bonds and contractor license bonds, the construction surety bonds field becomes far less complicated to grasp. The entire bonding process is sure to get easier with JW Surety Bonds’ effective service and quick turnaround.

Out and about: Real estate and mortgage lending trends in 2014

After a dynamic and rather positive 2013 for the real estate business, how is 2014 shaping up? 

The general vibe seems quite positive. Although the housing market has not recovered as fast as many would have wished, it is in an advanced stage of revival. The process is tightly linked to growing employment and economic stabilization. There are no big jumps here – but growth is steady.

With changing economic and demographic conditions, the real estate and mortgage businesses will need to keep adapting as well. The Millennials are the ones moving the market these days – and with their lifestyle and financial capabilities, they are changing the rules of the game.

Below are the hottest trends that are likely to influence the real estate market as well as mortgage lending in 2014.

Real estate prices will increase in 2014

 

Over 5 percentThis is the predicted mortgage rate by the end of 2014 according to the real estate market research firm Zillow. The increase of 1% in 2013 is due to the stabilizing economy, and the trend is very likely to continue in 2014.

The Federal Reserve is not keeping the rates artificially low anymore, as it did in 2012 and 2013 in order to support the market.

A 6 percent increase in housing prices. This is the prediction of the National Association of Realtors. Although this is a good sign for recovery of the market, the effect might not be too positive for buyers when combined with rising interest rates. It can push many properties, especially in hot areas such as Seattle, Austin, Salt Lake City and San Jose, beyond the reach of many potential homeowners.

Improving inventory. Recently we have seen a “seller’s market” due to the inventory shortage in some cities. Many people are withholding selling their property until the market returns to normal. However, this is bound to change soon with improved economic prospects and stronger buying power, coupled with rising consumer confidence.

Easier mortgages. It’s true that loan rates are on a growth curve which signifies that refinancing will be less sought after. This is likely to force mortgage lenders to step back a bit on their lending conditions, making it easier for people to get mortgages.

Lenders will also be influenced by stricter federal rules imposing mortgage standards. With the new rules in effect since January 10, if lenders’ loans default, they will have to take a bigger responsibility and face liability. The mortgage lender surety bond requirement for lenders’ licenses will remain to ensure compliance.

 

The number of home owners will decrease in 2014

Decreasing home affordability. In 2013, the Home Affordability Index was at a five-year low. This means that housing prices are growing faster than incomes. This trend will remain in 2014 as well. Increasing interest rates are also influencing affordability negatively.

Fewer home owners. Logically, with decreased home affordability, there will be fewer people able to own a home. Actually, home ownership is expected to drop to a 20-year low, according to Zillow.

There is demographic reasoning as well with young people being the nation’s future home buyers. While youth unemployment rates stay high, this group will not be able to afford investing in property until they themselves reach financial stability.

How to get a car dealer license in Florida

If you have an entrepreneurial spirit and are looking to start your own business, you know for sure that an auto dealership is a perennial favorite that cannot go out of fashion – simply because of the eternal popularity of motor vehicles. Becoming a car salesman, though, has turned into a more and more challenging task as the rules and regulations have gotten tighter with time. If you are about to start your auto dealership in the State of Florida, you will have to undergo various steps in the licensing procedure and this is not an easy or a cheap process. Hence it is important to be well aware of the general framework and to get acquainted with the procedure in detail so that you can also see how you can save time and resources in the various steps involved.

 

The basics

First of all, when you decide to launch a business in car sales in Florida, you will have to apply for a licensing permit with the Florida Department of Highway Safety and Motor Vehicles. The basic application form is your starting point in this case. Closely studying this document will provide you with the needed insight into the whole process as all the paperwork and steps are explained and listed.

Obtaining a license in Florida is an intricate process. You will have to choose precisely what type of business you would like to operate because the laws in Florida differentiate between four classes of license. The options are an independent dealer only for used motor vehicles; a franchise dealer for new vehicles that also allows you to sell used ones; a wholesale dealer, which allows you to deal only at wholesale prices with other dealers; and an auctions dealer, which permits you to sell vehicles from other dealers by bidding.

 

Map of Florida - Wikimedia Commons

Wikimedia Commons

 
 
 

 

 

The actual requirements

The requirements for the license are numerous and you will need to be rigorous in meeting them. You are obliged to have a physical office and there are certain rules guiding this space that are set by the DMV. Your dealership location will have to get an approval from them. Garage liability insurance is required too. As for you personally, you will have to provide a certificate as proof that you have attended a dealer training seminar and a complete set of your business documents. All of these steps are inevitable, and the applicable fees are fixed – $300 per approved location, as well as a fee for fingerprinting and processing. You have to renew your license every year and the fee for this is $75.

 

Saving on your license: the surety bond

One of the remaining requirements for receiving a license is obtaining a surety bond, which can be in the amount of $10,000 or $25,000 depending on the type of dealer you are. This is the step where you can save yourself time and money. Many people stumble upon the concept of bonding only when they start the licensing process, and this often catches them by surprise. A surety bond, unlike insurance for your own business, is a type of protection for your clients and is a legal requirement for starting your auto dealership business. When you get bonded, you do this through a surety bond agency. Since the surety bond is a form of credit given to your business, you pay a bond price that is a percentage of the bond amount.

How to Get A Car dealer License Video screenshot

Many surety bond agencies judge the bond price by evaluating many criteria of your personal and business finances and status like personal credit, personal and business financial balance, experience in the field, and so on. This may lead to a higher bond price if one of the factors is not deemed satisfactory. Other surety agencies, though, operate on a larger scale, which allows them to be more lenient in their evaluation and to consider only the personal credit score. This gives you more freedom and means you need only to perfect your credit situation in order to get the lowest possible bond price. If you would like to find out more about the bond, visit the Florida motor vehicle dealer bond page.

Even a lengthy and cumbersome process like bonding your auto dealership business in Florida can be simplified and made less of a financial burden. By obtaining enough information in advance and using a flexible surety bond agency, you are bound to have a smoother start in car sales.