How to Purchase a California Contractor License Bond?
If you want to become a contractor in California, according to the law, you need to have a license bond. For those who do not know its purpose, it is a guarantee that, as a contractor, you will keep the quality of your work up to a certain standard. Now, if you are new to the profession, you may have a hard time getting the hang of the purchasing procedures of a California Contractor License Bond. This is why we’ve decided to have them listed here:
Know Your Credit Score
Just like with loans, credit score is quite important when it comes to buying your contractor’s license bond. To put it simply, a good credit score can get you a huge rate discount while a bad score can do a bit of financial damage. The credit score is calculated according to a person’s financial situation, as well as, their health. So, what you need to do is to try and maintain a decent financial credit score by paying up your loans on time; if you have any. Not to mention, you have to keep in mind that your business’s financial situation will be taken into consideration, too. So, in order to get a low rate, it is advisable to keep your bank in tip top condition.
Approach a Surety Bond Agency
Some may ask, “can’t we go to the company directly?” Well, the answer to that is no. Most companies are simply responsible for paperwork, policies, and handling situations that have to do with business entities; they don’t deal with individuals. Here comes the role of a middleman; the surety bond agencies. They help contractors out when getting their bonds. By calculating your credit score and communicating with a certain surety company, they are usually able to get better rates. According to www.contractorbond.org, some bond agencies are quite understanding as to the reasons for poor credit scores which is why they tend to overlook that factor for most clients. On the contrary, to other surety agencies that don’t offer flexible programs and would rather not accept candidates with bad credit scores.
Make Sure All the Requirements Are Fulfilled
There are several conditions that are required from you to fulfill before your bond can be considered fully valid. First of all, it has to be drawn up by a surety company licensed by the California Department of Insurance. Second, it has to be signed by the attorney-in-fact of your surety company and approved by the Attorney General’s Office. Finally, once you acquire your California Contractor License Bond it is essential that you submit it at the CSLB’s Head Office; since, you are only allowed 90 days from the issue date of the bond.
Due to this seeming like quite an intake of information, what follows is a concise summary of everything that we’ve just said. Simply put, to purchase your license bond, you do not necessarily need a perfect credit score; but, the better it is, the less you will pay. Next, you have to approach a bond agency to start you off on the needed procedures; mostly form filling. Finally, you need to make sure that your bond has been signed by a couple of head figures and handed in at the CSLB’s headquarters as soon as possible.
