What is a Tennessee Credit Service Organization Surety Bond?
In the State of Tennessee, anyone doing business as a credit service organization must register with the Division of Regulatory Boards. A surety bond in the amount of $100,000 must be posted as a condition of that registration.
A credit service organization (CSO) is defined as anyone who sells, provides or performs any of the following services in exchange for payment:
- Improving buyers credit record, history or rating
- Obtaining an extension of credit for a buyer
- Providing advice or assistance in regards to either of the above items
How does a Tennessee Credit Service Organization Surety Bond work?
Tennessee Credit Service Organization Surety Bonds guarantee that the CSO complies with the Tennessee Credit Services Businesses Act and protect any person who is damaged by the unlawful actions of the CSO. If the CSO does not comply with the terms of the bond, a claim can be filed with the surety company. If the claim is valid, the surety will pay up to the penal sum of the bond to resolve the claim. The CSO is then required to reimburse the surety for all monies paid out, including any attorney fees incurred.
What are the terms of the bond?
Tennessee Credit Service Organization Surety Bonds renew on an annual basis and are filed with the Tennessee Department of Commerce and Insurance. The bond has a continuous term and remains in full force and effect until canceled by the surety. It must be maintained for 2 years following the date on which the CSO ceases to conduct business in the state. The bond can be canceled by the surety, at any time, by giving a 30-days written notice prior to the effective cancelation date, via certified mail, to the obligee. The aggregate liability of the surety will not exceed the penal sum of the bond in any event.
How do I get a Tennessee Credit Service Organization Surety Bond?
The first step is to complete our quick online application for your free bond quote. Submission takes only five minutes, and our underwriting staff will be in contact with you within a couple of hours with pricing.
After you receive approval, you must sign an indemnity agreement with the surety and provide payment for your bond premium. In most cases, we can issue bonds the same day we receive your signed documents and payment.
How much does a Tennessee Credit Service Organization Surety Bond cost?
Tennessee Credit Service Organization Surety Bonds are subject to underwriting and the price you will pay depends on a review of your personal credit report. Pacific Surety is proud to offer a variety of approvals, regardless of credit, with rates starting at $1,000 annually for well-qualified applicants. It typically takes just a few hours from quote to issuance of the bond, and we have the ability to beat any competitors pricing. If you have any specific questions, feel free to contact our knowledgeable underwriting staff.