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:
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).
The following bonds are ineligible for the SBA guarantee:
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.