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Texas Contractor License Bond

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What is a Texas Contractor License Bond?

Construction contractors working in Texas may be required to secure a license in order to work on residential or commercial projects in the state. While this is not a statewide requirement, many local jurisdictions make it mandatory for contractors to go through the licensing process. This often involves posting a surety bond, known as a Texas contractor license bond.

A Texas contractor license bond is a form of protection meant to safeguard the local licensing authority and a contractor's customers from work that is not performed in line with building codes. These surety bonds also ensure contractors pay all taxes due in a timely fashion, and they provide for coverage of financial losses to those harmed if work is not performed correctly.

Who Needs a Texas Contractor License Bond?

Not all contractors are required to get a license or a bond in the state of Texas. Each city or county determines who must have a Texas contractor license bond and in what amount. Several counties and cities mandate that building and roofing contractors have a bond in place, while others require landscape and irrigation, moving, water treatment, or swimming pool contractors to post a bond.

Check with your local licensing authority or agency to understand if and when a license is needed as a contractor and if a Texas contractor license bond is necessary as part of that process.

Texas Contractor License Bond Obligee Details

Surety bonds like a Texas contractor license bond represent a contractual agreement between the contractor, also known as the principal of the bond, the surety company providing the bond on behalf of the contractor, and the licensing authority requiring the bond to be in place. The local licensing authority is known as the obligee of the bond.

Because there is no statewide requirement for getting a Texas contractor license bond, the obligee of the bond is the licensing authority in a contractor's city or county.

How Much Does a Texas Contractor License Bond Cost?

The cost of a Texas contractor license bond varies depending on the amount of the bond and the risk the surety company takes on in issuing a bond. When it comes to the amount of the bond, this can vary significantly from one city or county to the next. For example, Abilene building contractors are required to secure a bond of $25,000, while a Beaumont roofing contractor only has a $15,000 bond requirement.

However, no matter the total amount of the bond, contractors are not on the hook for paying the full amount. A bond premium, calculated as a percentage of the total bond amount, is what contractors pay for their Texas contractor license bond. This price is a percentage of the bond total, ranging from 1 to 10%. Because the surety company takes on some risk with issuing a bond, a credit check is often required. A bad credit history and score leads to a higher bond premium.

How do You Get a Texas Contractor License Bond?

The process for getting a Texas contractor license bond is simple. You can start by submitting a brief quote request online to see how much your bond will cost. Once it is in place and the bond premium is paid, be sure to pay attention to the renewal timeframe to ensure you remain compliant with your contractor's license.


Frequent Questions

How much does a bond cost?

Pricing is a percentage of the contractor license bond amount that’s required of you, which is based on your personal credit. Use our bond pricing tool to to get a quick ballpark estimate.

Can I get bonded with bad credit?

Yes. You can apply and get bonded with bad credit. Our agency is the largest writer of bonds in the county, which allows us to approve contractors for bonds when other agencies cannot.

Are these the same as contract bonds?

No. Contractor license bonds ensure you will abide by the laws of your state, city or municipality when performing contracting work. Contract bonds guarantee public projects will be completed properly and are a separate bond type. You can learn more about contract surety bonds by visiting the contractor bond center.

Do I need a state or local bond?

It depends on who is requiring the bond of you, the local municipality, county or state. Depending on your location, it is possible you may need both a local and state bond, as contractor license bond requirements can vary drastically. You can select your state to see a full list of contractor license bond requirements.


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Our company has been with JW Surety for several years now so when we needed to obtain a bond for a new company, we immediately went to them for help. Our rep, Melissa, was extremely helpful and prompt which made the process extremely easy for me.
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Trying to get a local Surety Bond was like driving a car on three tires. I searched Surety Bonds and found JW Surety Bonds. I got online and filled out the information and with in 30 minutes received a response from Melissa. She was informative, friendly and helpful. One more super satisfied customer.

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About JW Surety Bonds
We are a family owned and operated agency established in 2003. We started with just two people, and grew to become the largest volume bond producer in the nation with 50+ employees. Since day one, our team focus has been on providing real-time online quotes, an easy process, and the best in claims defense. Learn more about our company.