Quick Answer: A surety bond in Texas typically costs 1% to 15% of the total bond amount, depending on your credit score, the bond type, and the industry risk involved. Most applicants with good credit pay around 1%–3% of the bond amount annually — for example, a $10,000 bond might cost $100–$300 per year — while higher-risk bonds or applicants with damaged credit can pay significantly more. 

If you've been asking, "how much is a surety bond," you're likely a contractor, auto dealer, notary, or business owner who's been told you need one before you can get licensed or bid on work. Surety bonds can feel confusing at first because, unlike insurance, they aren't protecting you — they're protecting the public and the entity requiring the bond. 

The cost of a surety bond, often called the premium, is only a small fraction of the total bond amount. This guide walks through how much a surety bond cost in Texas across common bond types does, what factors move your rate up or down, and how to get the most competitive pricing. 

What Is a Surety Bond and How Is the Price Calculated? 

A surety bond is a three-party agreement between the principal (you, the business or individual required to get bonded), the obligee (the government agency or client requiring the bond), and the surety (the company backing the bond financially). If you fail to meet your obligations, the obligee can file a claim against the bond, and the surety pays out — then seeks reimbursement from you. 

Because the surety is taking financial risk on your behalf, your premium is priced similarly to a loan: it's based on how likely you are to trigger a claim. That's why credit scores, business financials, and industry risk all play a role in your final rate. 

Average Surety Bond Costs by Bond Amount

Prices may vary based on your specific provider, coverage selections, driving/claims history, and other individual factors. The figures above are estimates only and are not a guarantee of your actual rate. 

How Credit Score Affects Surety Bond Pricing 

Credit score is the biggest factor most surety companies use to set your rate. Here's a general breakdown of how pricing typically moves with your credit profile:

Common Types of Surety Bonds in Texas 

• Contractor license bonds: Required by many Texas cities and counties before a contractor can pull permits or bid on public work. 

• Auto dealer bonds: Texas requires motor vehicle dealers to carry a $25,000–$50,000 surety bond as part of licensing. 

• Notary bonds: Texas notaries must carry a $10,000 bond, which is one of the least expensive bonds available, often $30–$50 total for a four-year term. 

• Mortgage broker bonds: Required by the Texas Department of Savings and Mortgage Lending for licensed mortgage professionals. 

• Court and fiduciary bonds: Required in probate, guardianship, and other court proceedings to protect estate assets. 

• Freight broker bonds (BMC-84): Federally required $75,000 bond for freight brokers arranging interstate shipments. 

How Much Is a Surety Bond in Texas by Industry? 

Pricing also varies by industry because some professions carry more claim risk than others. Construction and auto dealer bonds tend to sit in the middle of the pricing spectrum, while high-liability industries like freight brokering or mortgage lending can see higher premiums due to the larger bond amounts required. 

Houston's active construction and auto sales markets mean many local business owners need bonds simply to operate legally, so shopping for your bond the same way you'd shop insurance can make a meaningful difference in your annual cost. 

How to Get the Best Rate on a Surety Bond in Houston 

• Improve your credit score: Even a modest improvement can move you into a lower pricing tier. 

• Compare multiple sureties: Rates can vary meaningfully between surety companies for the same bond type. 

• Provide complete financials: For larger bonds, strong financial documentation can offset a lower credit score. 

• Bond only for what's required: Confirm the exact bond amount your obligee requires before applying. 

• Work with an independent agency: An agency like AZ Insurance Agency can shop multiple surety markets on your behalf. 

Frequently Asked Questions 

How much is a surety bond on average? 

Most surety bonds cost between 1% and 15% of the total bond amount per year, with applicants who have good credit typically paying 1%–3%. 

How much does a surety bond cost for a small business? 

It depends on the bond amount and industry, but small business bonds (like contractor or dealer bonds) commonly range from $100 to a few thousand dollars per year. 

How much is a surety bond in Texas for contractors? 

Contractor bond amounts and costs vary by city and county requirement, but premiums typically fall in the 1%–5% range of the required bond amount for applicants with reasonable credit. 

Can I get a surety bond with bad credit? 

Yes. High-risk bond programs exist for applicants with poor credit, though premiums are higher, often in the 10%–15%+ range. 

Is a surety bond a one-time cost or annual? 

Most surety bonds are billed annually or for a multi-year term (like a 2-year or 4-year notary bond) rather than a single one-time fee. 

What's the difference between a surety bond and insurance? 

Insurance protects you from your own losses. A surety bond protects a third party (the obligee) from your failure to perform — and you're ultimately responsible for repaying any claim paid out. 

Get a Quote in Houston Today 

AZ Insurance Agency helps Texas families and business owners find the right coverage at the right price, with bilingual support at 15 Houston-area locations plus Plano and Lewisville.