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What small businesses are eligible and should apply for a SBG?



Business owners should apply for a surety bond if they are worried about steep losses from a failed contract or he/she wants to maintain a certain level of quality or service.



These are some SBA eligibility requirements for a SBG:

  • Contract must be less than $2M
  • The business must qualify as a small business under federal regulations
  • The business must meet SBA’s size standards (can visit: http://www.sba.gov/regulations/121/)
  • Contractor should have a good reputation (not suspended or debarred)
  • Business should be independently owned and operated

What are the costs associated with the SBA’s SBG?

The costs associated with the SBG for a small business are the fees posed by the surety company and the SBA. The surety company charges a bond premium and the SBA charges a guarantee fee (a percentage of the contract amount).

What bonds are ineligible for the SBA’s SBG program?

The following bonds are ineligible for the SBA guarantee:

  1. Advance Payment
  2. Coal Leases
  3. Completion
  4. Notary Bonds
  5. License & Permit
  6. Judicial and Court
  7. Public Official
  8. Financial Guarantees
  9. Forfeiture
  10. Gas Leases
  11. Grain Elevators
  12. Lease
  13. Subdivision
  14. Reclamation Bonds for New Mining
  15. Oil Leases

How can a small business apply for the SBA’s surety bond?

Contractors should contact a surety bond producer who represents a surety company that participates in the SBG program. A list of local-area producers, application instructions for both electronic and paper submissions SBA’s Web site at www.sba.gov/osg or can be obtained by calling SBA’s Office of Surety Guarantees at (202) 205-6540.