What Is a City of Galveston Contractor’s License Bond?
As a general contractor in Texas, you don’t need a license to work in the state, but you may need to register with the county or city where you plan to work. In the coastal city of Galveston, you have to purchase a surety bond for a minimum of $25,000 and submit proof of it with your registration application. This bond helps prevent fraud and other illegal practices in the state, as it guarantees your performance, ability, and integrity as a contractor.
In addition to the surety bond, you must pay a registration fee and provide proof of liability insurance when you submit the application. The city does require first-time applicants to submit original documents and list the city of Galveston or Assignee as the obligee. You can turn in computer-generated documents only if you are already a contractor in the city’s system.
How Does a City of Galveston Contractor’s License Bond Work?
A contractor’s license bond is an agreement between three parties:
- The contractor (also called the principal)
- The surety company
- The organization that requires the bond (also called the obligee)
The contractor pays the surety company a fee in exchange for the bond. If you’re unable to complete the job you agreed to do, the surety bond company may find another contractor to complete the work or pay the obligee the amount of the bond. In the city of Galveston, $25,000 is the pre-determined amount.
A surety bond is not a form of insurance, and it does not protect you or offer coverage against loss and damage. Instead, it’s an assurance to the local government that you will do the job you agreed to do and will follow all local laws and construction codes.
City of Galveston Contractor’s License Bond Details
To purchase a Galveston contractor’s license bond, complete the application and provide the following information:
- Effective date
- Business structure
- Contact information
You can choose to receive digital copies of the bond document via email or paper documents through regular mail.
In most cases, the cost of a surety bond is a percentage of the bond amount, and bond terms can vary depending on your personal credit. If you have excellent credit, the bond amount will likely be no more than 1% of the bond amount. You can expect to pay between 2% and 5% of the bond amount if you have less than stellar credit. We’re happy to discuss the project and your situation to give you a more precise quote.
In most cases, the cost of a surety bond is a percentage of the bond amount, and bond terms can vary depending on your personal credit. If you have excellent credit, the bond amount will likely be no more than 1% of the bond amount. You can expect to pay between 2% and 5% of the bond amount if you have less than stellar credit. We’re happy to discuss the project and your situation to give you a more precise quote.
Completing the application for a city of Galveston contractor’s license bond is quick and easy. Fill out the online application, choose how you want to receive the documents, and submit your payment.
We also may ask to see your company’s financial statements for the last two years or more, along with a copy of the contract or bid outlining the scope of the project. Be prepared to provide some form of collateral, such as real estate.
- Click the Buy Now button.
- Fill out the easy bond form.
- Confirm your order and select how you would like your bond documents delivered. Email or regular mail.
- Pay for your bond.
- If you chose to have your documents emailed, you will receive them within minutes.
It’s that simple and fast!
Bond Purchase Process
1. Find Your Bond
2. Secure Pricing
3. Buy Online
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The bonding process can be confusing and cumbersome. Our surety bond experts are standing by and ready to answer any questions. Let’s get you bonded today!
Frequently Asked Questions
There are hundreds of different bonds for all kinds of purposes—but regardless the industry or project—they all operate essentially the same way. A surety bond guarantees that you will operate professionally and if you break the rules, a claim can be made on your bond which you’re responsible to pay.
It’s a guarantee that you will complete the work and fulfill your contractual obligations. Think of it as insurance for the public, not your business.
For most bonds, you can get instantly approved and print bonds at your home or office. However, we do not offer instant approvals for a select number of bonds, as the underwriting process generally involves a more extensive review of the applicant.
For the most part, yes. Bad credit can increase rates for license and permit bonds and most can also get approved for fidelity bonds regardless of credit. For contract bonds, larger contractors with poor credit can be approved with strong CPA-prepared business financials.
It’s a legally binding contract that you must sign to obtain a surety bond. The agreement guarantees that if you cause bond claims you will pay them in full.
Looking to Get Started or Have Questions?
The bonding process can be confusing and cumbersome. Our surety bond experts are standing by and ready to answer any questions. Let’s get you bonded today!