A Minneapolis Surety Bond or Minneapolis Bond is a blanket term that refers to any bond required to legally do certain activities in Minneapolis, Minnesota. This includes:
- License and Permit Bonds to obtain certain licenses and permits.
- Contractor Bonds for contract work and public construction projects.
- Court Bonds to partake in court proceedings.
However, no matter the reason a surety bond is required, they are all used for the same general purpose—to safeguard against fraud and unethical behavior. Below is a quick breakdown of how they work.
All surety bonds involve three parties:
Principal: the person that needs to purchase the bond (ex. you).
Obligee: the entity requiring the principal to get bonded (ex. a government organization, the State of Minnesota, etc.).
Surety: the party that backs the bond financially (ex. a bonding company such as JW Surety)
In the case that the principal conducts illegal or unethical activity that results in losses, the bond ensures that they are financially liable.
A Minneapolis freight broker fails to pay a trucking company for their services. That company then makes a claim against the broker’s $75,000 freight broker bond to get reimbursed for financial damages. The claim is deemed valid, and the surety bond company pays out $20,000 to the claimant. While the surety originally covers this cost, the principal is then on the hook to pay the surety back in full, plus any legal fees.
In short, a surety bond is something you may need to get but hope never to use. To learn more about surety bonds and the bonding process, check out our guide: What is a Surety Bond?
Surety Bond Requirements in Minneapolis
Over 115 Minnesota surety bonds are required for one reason or another in Minnesota—many of which are required specifically in Minneapolis. However, you are only required to get a Minneapolis surety bond if an obligee is asking for one. The most common types of bonds required in Minneapolis fall under the following three broad bond categories:
License and Permit Bonds: Required to legally work in some professions or obtain a business license in Minneapolis. These commercial bonds include auto dealer bonds, freight broker bonds, contractor license bonds, mortgage broker bonds, etc.
Contractor Bonds: Required to bid on jobs and undertake certain types of contract work in Minneapolis. Construction companies and tradespeople may be required to get bid bonds, payments bonds, performance bonds, contract bonds, etc.
Court Bonds: Required to partake in some types of proceedings in Minneapolis courts. These commonly include fiduciary bonds and probate bonds.
Popular Types of Surety Bonds in Minneapolis
Auto Dealer Bond
A Minnesota auto dealer bond, also called a motor vehicle dealer bond, is a prerequisite to getting an auto dealer license. An auto dealer license is required to sell cars in Minnesota legally.
Required by: Minnesota Department of Vehicle Services.
Contractor License Bond
A Minnesota contractor license bond is a prerequisite for all contractors applying for a Minnesota contractor license.
Required by: Obligee varies.
Electrical Contractor Bond
A Minnesota electrical contractor bond is a requirement for electrical contractors operating in Minnesota.
Required by: Minnesota Department of Labor and Industry.
Freight Broker Bond
A Minnesota freight broker bond is a licensing bond required to obtain a freight broker license. This license allows a freight broker to operate in the state of Minnesota.
Required by: Federal Motor Carrier Safety Administration (FMCSA).
Credit Services Organization Bond
A Minnesota credit services organization bond is needed for all credit services conducting business in Minnesota. However, you are exempt if you run a collection agency or are a real estate broker. See Minnesota statute 332.52 for more information.
Required by: Minnesota Department of Commerce
How to Get a Surety Bond in Minneapolis
1. Find Your Surety Bond
Your obligee should be able to tell you exactly which bond you need and in what amount.
Still unsure of which bond you need? Contact one of our bonding experts or use our find your bond tool.
2. Fill Out a Bond Application
After choosing a surety company or bond agency, fill out an application for the bond you need. Many sureties offer a quick and easy online bond application that provides a free bond quote. You can often get bonded in a day or so with this online bond form.
3. Sign the Bond Agreement & Pay
Sign the agreement, email or fax it back to your bond provider, and pay your invoice online. Once everything is processed, you will receive an email copy of the surety bond. Additionally, the original bond will be sent to you in the mail.
How Much Does a Surety Bond Cost in Minneapolis?
Minneapolis surety bond amounts range from the low thousands to multiple millions. However, what a principal (the bondholder) pays for a bond is only a small fraction of the full bond amount.
For example, an applicant with good credit can expect to pay approximately 1%-5% of the total bond amount for most types of surety bonds. Therefore, to secure a $20,000 bond, they will pay a bond premium of $200 - $1000.
For more information, visit our guide: How Much Do Surety Bonds Cost?
Can I Get a Minneapolis Surety Bond with Bad Credit?
Yes, in many cases you can get a Minneapolis surety bond with bad credit. There are some bonds that you may not be able to secure if you have severe credit issues, such as contract bonds. Contrastingly, many license and permit bonds, for example, are often available to those with bad credit at a higher rate.
Why Choose JW Surety Bonds to Handle Your Bond?
JW Surety Bonds can help you not only with your Minnesota bond needs—we are licensed in all 50 states. However, the JW Surety advantage doesn’t stop at convenience; we also offer.
- A knowledgeable team of bond experts that go above and beyond to help you with your surety bond needs. This includes helping you find the right bond and getting you bonded at the best rate possible. We’re uniquely able to do this due to the volume of bonds we underwrite and our in-house underwriting service.
- Bond advocates assigned to all bond claim cases to defend and guide.
- A thorough claim investigation process for all claim cases—we ensure you don’t pay for illegitimate claims.
Use our free estimate tool for an instant quote or contact one of our bond experts at (888) 592-6631.