Before knowing about the collection agency bond, it is important to get an idea about the collection agencies. What are the collection agencies? The collection agencies are the agencies that help the companies in the recovery of debts. The companies who give loans for the people sometimes fail in recovering the loan and this is the time when these collection agencies enter. They help companies with the recovery of money. As these companies have the complete information of the debtors there is a surety bond that is a professional bond that deals with the rules and regulations that must be followed by the company.
The collection agencies are high at risk as they have a bit of bad reputation in the people because they collect the debts. To ensure that the sensitive information that these collection agencies have is safe and secured the bond is prepared.
Claiming of the Bond
The bond claim refers that you didn’t fulfill the duties of the license and ignored the rules and regulations too. Every person holds the right to make a claim against the bond, the only thing to remember here is the amount that has been claimed must not be more than the actual price of the bond.
These are the reasons for which a claim can be made against the bond
- Misusing the money of the customers
- Overcharging the customer
- Manipulating the fees levied on the customer for your benefit
Claims can be made against a collection agency bond only when the bond is active. If any person claims the bond for a collection agency the surety bond companies give them a certain time to sort out the issue and if the issue remains the same after that stipulated time then the investigation about your agency and the records will start.
Cost of the Collection Agency Bond
The cost of this collection agency bond varies with the state, in some states it starts at $ 10,000 while in other states it may require a lot of amounts. The cost of this bond depends upon the rules of a particular state.
The collection agency bonds are very important for any collection agency and these agencies make sure that no one claims for the bonds. If any person claims for the bond, there is a greater chance that the reputation of total companies will be at stake.