How to Get a Collection Agency License in 2024

Published: Jan 06, 2022

collection agency license


Do you want to start a collection agency in the U.S.? In most states, you need to undergo a rigorous administrative process before you can launch your operations. More specifically, you have to obtain a collection agency license. 

The licensing procedure ensures that you are a suitable candidate for conducting debt collection services in the respective state. Each state authority sets the exact requirements that you have to satisfy in order to get licensed. 

In many places, the process is conducted via the Nationwide Multistate Licensing System and Registry (NMLS). Some states, however, handle the licensing through their own regulatory body. 

In the guide below, you can get acquainted with the general steps that you need to take in order to obtain a debt collector license. You can also find out the requirements for a collection agency license by state in the dedicated individual guides.  

Get to Know Your State’s Collection Agency License Requirements

Since the criteria for getting a collection agency license vary between states, you have to find out the exact requirements that your state imposes on applicants. It’s a good idea to determine what they are as early as possible. 

The information is available on your state’s regulatory authority’s website, or in the Nationwide Multistate Licensing System and Registry (NMLS). 

[List of collection agency license guides per state] 

Meet the Licensing Criteria

collection agency licenseSome of the requirements that you have to meet to obtain a debt collection agency license are similar across the U.S. They are listed below. 

Business Documents

All applicants have to register a business entity in the state in which they wish to operate. Besides this, you have to register your trade name, if you’re planning to use one. Typically, you also need a Certificate of Authority issued by state authorities. 

In addition, you would typically need to get an Employer Identification Number (EIN) from the IRS. 

You have to provide the contact information of the main stakeholders in your business, as well as details about your organization and history of operations

Criminal Background Check

In the typical case, you would need to undergo a state criminal background check. You may also have to pass an FBI criminal background check

Financial Statements

In most states, you have to provide your financial statements. You may need to provide proof that you meet a certain level of net worth through them. 

There may be additional requirements, such as information about trust accounts

Post a Collection Agency License Bond

One of the most important requirements that you need to fulfill to get licensed is to obtain a surety bond. This is a security instrument that guarantees your legal compliance and thus protects your clients. 

The amounts of the collection agency bond that you have to provide vary from state to state. They may be anywhere from $25,000 to $100,000, and beyond

To get bonded, you have to pay a fraction of the required amount. This is called the bond premium. It depends on factors such as your personal credit score, business finances, and any fixed and liquid assets that you can demonstrate. The stronger your overall profile is, the lower your cost would be. You can expect rates between 0.75% and 5% if your finances are in good shape. 

Want to see the exact cost of your collection agency bond? Fill in the short form below! 

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Complete Your State’s Collection Agency License Application

When you have ensured that you meet all criteria set by your state authorities, it’s time to fill in the application form. It may be provided by the state body, or the NMLS if the process is handled there. Together with the completed application and the relevant documents, you also have to pay a licensing fee


Do you need more information about obtaining your collection agency license and bonding? Don’t hesitate to get in touch with us at 877.514.5146

Ready to get your FREE surety bond quote? Apply with Lance Surety Bonds and get bonded in minutes.
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Get a FREE Surety Bond Quote in Minutes
  • Fast and Secure Application
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  • Money Back Guarantee
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About Lance Surety Bonds

Lance Surety Bond Associates, Inc. is a surety bond agency based out of southeastern Pennsylvania that is able to write all surety bond types in all 50 states. We are dedicated to servicing all of our customers' surety bonding needs throughout the country and guarantee competitive rates, timely responses, and unparalleled customer service.

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