California Real Estate Broker Bond

While a surety bond is not a licensing criterion for all real estate brokers in California, it may be applicable for restricted licensees. The BRE may impose a bonding requirement on applicants who have held a California real estate broker license and have committed violations, or applicants who do not meet all other criteria.

In this way, the state body can better enforce the broker’s compliance with the Business and Professions Code Sections 10000 to 11288 and [Title 10 of the California Code of Regulations set by the Real Estate Commissioner.

The California DRE sets the bond amount that a broker may have to obtain. The bond premium is only a fraction of this amount. For applicants with good finances, the bond rates are often in the range of 1%-3%. If you have to post a, say, $15,000 bond, this means your premium may be as low as $150 to $450.

How is your surety bond cost set, exactly? Besides the bond amount, it depends on a number of personal and business financial factors. The surety you apply with will look at your personal credit score, business finances, assets and liquidity, and even your business know how. If your overall profile is deemed stable, you will have to pay a lower bond price.

Lance Surety Bonds operates its Bad Credit Surety Bonds program to help out applicants struggling with low credit scores, tax liens, bankruptcies, or civil judgements.

If you have problematic finances, you can expect a bond rate in the range of 5% to 10%, which is needed because of the higher bonding risk. Still, we work with numerous A-rated, T-listed surety companies. This gives us access to a wide variety of bonding options that we can offer you.

Need more information? Make sure to check out our How to Get Bonded page, or just call us at (877) 514-5146. Lance Surety Bonds’ experts will be happy to help you out.

Unlike insurance, your California real estate broker surety bond does not protect your business. It serves as an extra layer of protection for your customers and partners. Its goal is to guarantee that you will act in accordance with state laws when handling properties and funds in your capacity as a broker.

In case you transgress from your legal obligations and engage in fraud or misuse, you may get a claim on your bond. In this way, harmed parties can seek a compensation for your actions. In case the claim is proven, you are liable to repay them up to the penal sum of your bond, which is the bond amount that you had to post. Thus, bond claims are a serious threat to your finances and business reputation and should be avoided as much as possible.