A Connecticut Consumer Collection Agency Bond, required of collection agencies operating within the state of Connecticut, serves to ensure adherence to and compliance with the state laws and regulations.

What is a Connecticut Consumer Collection Agency Bond?

A Consumer Collection Agency Bond in Connecticut represents a legally binding agreement that mandates collection agencies to operate within Sections 36a-800 to 36a-814, inclusive, of the Connecticut General Statutes, thereby safeguarding the financial interests of consumers. This financial instrument is designed specifically to ensure that these agencies act in good faith and in adherence to the stipulated regulations when collecting outstanding debts.  

In an analytical perspective, the bond functions as a preventive measure against unlawful practices. It is predicated on the principle of accountability, aimed at fostering an environment of fair debt collection. The bond essentially serves as a guarantee that the collection agency will abide by the laws of the state, in this case, Connecticut, in executing their duties. If they fail to do so, the bond provides a recourse for financial reparation to aggrieved parties.

To illustrate, suppose a collection agency violates the terms of its license, perhaps by using aggressive or misleading tactics in debt collection. The bond acts as a safety net, enabling the affected consumer to file a claim against the agency. The agency is then legally obligated to pay reparations, up to the total amount of the bond.

In essence, the Consumer Collection Agency Bond in Connecticut is a crucial tool for consumer protection. It serves as a mechanism to uphold ethical standards and regulate the operations of collection agencies, fostering a sense of security and belonging among consumers. By providing a financial guarantee against potential misconduct, it creates a more trustworthy and reliable environment for debt collection.

How much does it cost to get a Consumer Collection Agency Bond in Connecticut?

Applicants with qualifying credit can expect an annual rate of 1% or $500 for the $50,000 Consumer Collection Agency Bond.  Applicants with less than stellar credit can be rest assured we will still provide you with the best bond rate available based on the applicants current credit situation.

The following factors significantly influence the cost of a Consumer Collection Agency Bond in Connecticut:

• The applicant's credit score: A higher credit score generally means a lower premium. This is because a good credit score signals a lower risk to the surety.
• The bond amount: The higher the bond amount, the higher the premium. This is a result of the increased potential liability for the surety.
• The applicant's experience in the collection industry: Experienced applicants are often seen as less risky, which may result in lower premiums.
• The financial strength of the applicant: Applicants with strong financials are more likely to fulfill their obligations, translating to lower premiums

Who needs a Connecticut Consumer Collection Agency Bond?

In the state of Connecticut, any entity operating as a consumer collection agency is required to secure a Consumer Collection Agency Bond. This requirement is not exclusive to large corporations or nationwide collection agencies; it applies to all entities, regardless of their size or the volume of their business. The bond acts as a financial guarantee that the collection agency will comply with the state laws and regulations governing their operations.

Any person or entity who is: 

• engaged as a third party in the business of collecting or receiving payment for others on any account, bill or other indebtedness from a consumer debtor 
• engaged in the business of debt buying 
• engaged in the business of collecting or receiving tax payments 

CT Consumer Collection Agency license information is available on the NMLS Licensing website.

How do I get a Consumer Collection Agency Bond in Connecticut? 

Simply complete our online application for a CT Consumer Collection Agency Bond and our staff will provide you with your bond quote and approval.  Most applications are approved "same day" assuming the account qualifies for the bond.  Applicants with less than stellar credit can be rest assured we will still provide you with the best bond rate, given the applicants credit report.