The SBA Bond Guarantee Program was established by Congress in 1971 to address the plight of small and emerging contractors that are often unable to obtain surety bonds within the standard market.
The SBA will guarantee a bond up to 90% in many cases. This allows the surety to loosen its normal underwriting criteria. Contractors in the SBA Program are able to obtain bonding at a higher level than they would in the standard surety market.
Alamo Surety Bonds is an active participant in the SBA Bond Program.
HOW IT WORKS
A contractor must must first apply for the bond, providing the necessary application, financials, and other documents as required by the surety. If the contractor does not meet the surety's standard underwriting guidelines, it may chose to place the contractor in the SBA Program as a viable solution. There is an additional SBA form that the contractor must complete and sign:
The SBA Form 994 - Application for Surety Guarantee
COST
In addition to the surety bond premium, the SBA charges a contractor fee of 0.60% of the final contract price.
For more info, call Jim at (210) 930-5550
