Texas Surety Bond Guide

Which Texas Surety Bond Do You Need?

Texas requires two main types of surety bonds: license and permit bonds needed for many professions such as contractors and auto dealers to operate legally; and contract bonds for public construction projects. If you’re not sure of what bond type you need, continue reading or contact a bond professional. It’s important that you understand how surety bonds work and that claims can put you at risk.

Getting License and Permit Bonds

Texas requires license and permit bonds in order to get licenses/permits for many different professions. You can find the full list of license and permit bond requirements for Texas by using our bond requirement search tool.

One of the most commonly needed license bonds is the motor vehicle dealer bond needed to sell vehicles and get a dealer license, which is required by the Texas Department of Motor Vehicles (TXDMV). Another commonly needed bond is the certificate of title bond needed to transfer the ownership of a vehicle that has a lost/inaccurate title, which is also required by the TXDMV. Lastly, another frequently needed bond is the contractor license bond required to perform contracting work in several cities across Texas. Keep in mind, there are no contractor license bonds required by the state itself, only cities and towns. It’s possible that you may need both a contractor license bond and contract bonds depending on the type of work and where you’re performing it.

Texas License and Permit Bond Search


Getting Contract Bonds for Public Jobs

Contract bonds such as bid and performance bonds are needed to bid and work on public construction jobs. However, they’re typically required by cities or municipalities as opposed to the state. Learn more about how you can get bonded public construction jobs.

What Do Bonds Cost in Texas?

Bond pricing varies drastically depending on the bond amount required of you and your rate (which is the percentage of the full bond amount you must pay). Find out how your rate is calculated, or use our bond pricing tool to get a ballpark estimate or an exact quote.

Can You Get Bonded with Bad Credit?

It’s possible to get surety bonds with credit issues in Texas, but it will depend on the bond type you need and how serious your credit issues are. You can get approved for most license and permit bonds even with bad credit. However, it’s harder to get contract bonds with credit issues. You may be able to get contract bonds with minor credit problems; however, you’ll probably be limited to smaller projects. Unfortunately, it’s almost impossible to get approved for contract bonds with severe credit issues such as large collections or civil judgments (unless you’re a larger contractor with strong CPA business financials). Why? Because surety companies will view your personal credit issues as a direct reflection of how you will handle the responsibilities that come along with working on a public job, and your ability to pay bond claims if they happen.

Getting Court Bonds in Texas

Court bonds aren’t as common as the other bonds mentioned above, but can be required by Texas courts if you need to appeal a court decision, become a legal guardian of a minor or operate as a fiduciary of an estate.

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