What Is a Minnesota Auctioneer Bond?
Posting an auctioneer bond is a licensing requirement for auctioneers in many states across the country. If you want to obtain a auction license in Minnesota, you will have to get bonded.
The bond is required on the state level, but is enforced by your local county. It guarantees your compliance with the Minnesota Statutes. In case you fail to abide by the law, you can get a bond claim, which provides compensation to affected parties.
Similarly to other surety bonds in the state, your bond is a contractual agreement between three entities. The principal is your auction company that needs to get bonded. The county authority that requires the bond is the obligee. The surety is the third party which provides the bond.
Questions about Auctioneer Bonds in Minnesota
Who needs to obtain this bond?
If you want to operate in the field of auctioning in Minnesota, you will have to get licensed with your county and provide a bond. The licensing and bonding requirements apply to the whole state, but are enforced on the county level. Some of the counties in which you will need a bond are Hennepin [link to pdf], Olmsted [link to pdf], Rice[link to pdf], St. Louis[link to pdf], and Dakota County[link to pdf].
The purpose of the bond is to protect your customers from any potential misuse and fraud you might engage in. Examples include mishandling of funds and unethical behavior in the auctioning dealings.
How much does bonding cost?
Your surety bond price depends on the bond amount you need to post. This, in turn, is set by your county. According to the state rules, the amount has to be between $1,000 and $3,000.
You need to pay only a fraction of the bond amount that you are required to obtain. This is called the bond premium and is typically between 1% and 5% of the required amount. For a $3,000 bond, this means a premium below $150.
How is your bond cost determined? Your surety examines your personal and business finances to assess your bond application. It has to check the level of risk associated with bonding you. The important factors are your credit score, business documents, and any assets and liquidity you can showcase. Your bond premium will be lower the more stable your finances are.
For a full overview of how your bond price is set, you can consult our surety bond cost page.
|Bond Type||Surety Bond Amount||Credit Sore|
|Above 700||Between 650-699||Between 600-649||Below 599|
|Minnesota Auctioneer Bond||$1,000 - $3,000||$100||$100||$100-$150||$150-$300|
What if I have bad credit?
If you struggle with problematic finances, you can still get bonded with us. At Lance Surety Bonds, we run our Bad Credit Surety Bonds program to help applicants with credit score, tax liens, bankruptcies, and civil judgements.
You can expect a bonding premium in the range of 5%-10%. This higher price is there to compensate for the increased bonding risk. As we work with numerous A-rated, T-listed surety companies, we can still get you a great bonding rate that matches your circumstances.
How do I apply to get bonded?
Apply online today for a free Minnesota auctioneer bond quote. All you need to do is submit the application form and one of our agents will get in touch with you shortly.
For more information on bonding, you can refer to our extensive How to Get Bonded page.
Our bonding specialists here to help. If you have further questions, you can call us at (877) 514-5146.
What if I get a bond claim?
The goal of your bond is to protect your customers. If you transgress from your legal obligations, an affected party can make a claim against you. In case it gets proven, you have to compensate financially the claimant.
The maximum reimbursement is the penal sum of your bond, which is between $1,000 and $3,000. Your surety covers all costs at first, but you have to repay it afterwards. Besides the financial consequences, claims also can prevent you from getting bonded in the future.
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