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TN Collection Service License Bond

  • Get your Tennessee collection service bond online
  • Outstanding bond rates
  • Bad credit bonding available

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What Is a Tennessee Collection Agency License Bond?

If you want to start a collection agency in Tennessee, you have to get licensed with state authorities. You need to obtain a collection agency bond as a part of the licensing prerequisites.

The goal of your bond is to ensure you will follow all applicable rules and regulations. It protects your customers and the general public. If you fail to abide by the law, a claimant can seek reimbursement via a bond claim.

This surety bond works just like any other bond in that is is a contract between three parties. The principal is your collection agency that has to obtain the bond. The Department of Commerce and Insurance is the obligee which imposes the bond requirement. The third party is the surety, which is in fact the bond provider.

Frequently Asked Questions

Who is required to obtain a bond?

Any entity that wants to collect payments for its customers in Tennessee needs to get a state collection agency license from the Department of Commerce and Insurance. Together with your application, you have to submit a surety bond in the appropriate amount and in the correct form:

  • Service License Bond A - $15,000

  • Service License Bond B - $20,000

  • Service License Bond C - $25,000

Your bond guarantees that you will comply with the Tennessee Collection Service Act. It needs to be renewed together with your license every year.

How much do you have to pay to get bonded?

The bond amount that Tennessee collection agencies have to post depends on the number of employees. It can be between $15,000 and $25,000.

Your bond premium is only a percentage of the amount that you are required to obtain. For collection agencies with stable finances, it is usually between 1%-5%.

Surety Bond Cost Based on Credit Score
Surety bond name Surety bond amount Above 700 Between 650-699 Between 600-649 Below 599
TN collection service license bond for 1-4 employees $15,000 $112.5-$225 $150-$375 $375-$750 $750-$1,500
5-9 employees $20,000 $150-$300 $200-$500 $500-$1,000 $1,000-$2,000
10+ employees $25,000 $187.5-$375 $250-$625 $625-$1,250 $1,250-$2,500

How exactly is your surety bond cost set? Factors such as your personal credit score, business finances, and assets and liquidity are among the most important ones. By examining them, your surety provider can assess how risky it is to get you bonded. If your overall profile is solid, you can expect to pay a lower bond premium.

Can I get bonded with bad credit?

You can get the bond you need with Lance Surety Bonds even if you struggle with a low credit score, tax liens, bankruptcies, and civil judgements. Our Bad Credit Surety Bonds program is designed for you.

The bond rates are typically between 5% and 10% to compensate for the higher risk. As we have close relations with a number of A-rated, T-listed surety companies, we can find the right bond option that matches your situation.

How do I get a Tennessee collection service license bond?

Do you want to learn more about the bonding process? You can consult our How to Get Bonded page to get more details.

Our bonding specialists are happy to help. If you have questions or need help with your application, don’t hesitate to call us at (877) 514-5146.

What happens if I get a bond claim?

The purpose of your bond is to protect the general public rather than your business. This means that if you do not abide by the rules set in the state Collection Services Act, you can get a claim against your bond. This includes, most notably, if you fail to account to your clients all collected sums within one month after the end of each calendar month.

In such cases, a harmed party can file a claim to seek a compensation. Your surety may cover the costs at first, but you need to repay it fully afterwards. As this suggests, bond claims are a serious financial and reputational threat to your business, so it is best to avoid them.

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About Us

Lance Surety Bonds
Lance Surety Bond Associates, Inc. is a Pennsylvania-based surety bond agency that offers bonding at competitive rates in all 50 states. Established in 2010, our company has grown to become one of the top online bond producers in the country. Working exclusively with A-rated and T-listed bonding companies gives us the confidence to offer a 100% money-back guarantee. read more

What Our Clients Have To Say?




Kimberlee Ables
Quick response times and turn around for issuing bonds. Great customer service and very knowledgeable. We have used Lance Surety multiple times and have never been disappointed. Highly recommend them and Collette!
Andrew Poincot
Long story short, these guys cut through the B.S. and get the job done. Responsiveness, excellent! Communication, excellent! Respect for their industry partners, excellent! John, Collette, Ryan, you're all-stars! Thank you!
Margie Martinez
We decided for Lance Surety Bond's quote for 2 reasons; Price and Customer Service. Our Representative Ryan was just SUPERB!! [...] I highly recommend Lance Surety Bond for all your Bonding needs! I'll definitely come back for all of mine. :-) Thanks Ryan!

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