What is a Pennsylvania Pawnbroker Bond?
Any person who wishes to engage in the business of lending money or purchasing personal property must obtain a license to be able to conduct a pawnbroker business in Pennsylvania. As part of the license requirements, a pawnbroker is required to post a surety bond.
The Pawnbroker Bond guarantees that the pawnbroker licensee will faithfully comply with all applicable laws, provisions, and statutes relating to the lending of money or pledging and buying of goods and property at interest.
The bond also ensures that any person who suffered financial losses resulting from a pawnbroker’s unethical and wrongful acts will be compensated.
Under the Pawnbroker License Act, a “pawnbroker” means any person who:
- Engages in the business of lending money on the deposit or pledge of personal property;
- Purchases personal property with a clear understanding to sell it back at a later time at a specified price;
- Or lends money upon goods, wares or merchandise pledged, stored, or deposited as collateral security.
What is the bond amount?
The bond amount is $2,000.
The cost of the bond is a percentage of the bond amount. It typically ranges from 1%-5% of the bond amount, which serves as your bond premium.
How do I obtain a Pawnbroker Bond?
To secure this type of bond, the commercial collection agency registration applicant must seek the assistance of a surety bond company.
You will be asked to apply for this bond. If you’re ready to apply for one right now, you may easily do so HERE!
Once the application is received, the surety bond company will immediately process it. In our case, one of our expert surety bond agents will guide you through the whole process from the time you applied for the bond. We will make sure that you understand all the conditions before we issue the bond.
An underwriter will then typically evaluate the following your credit score. You may also provide a copy of the BOND FORM, which can be obtained from the Pennsylvania Department of Banking and Securities.
Once the pre-qualification process is fulfilled, we will execute the bond and send it to you!
What are the bond conditions?
- The Surety must be authorized to issue surety bonds in the Commonwealth of Pennsylvania.
- The Principal (pawnbroker licensee) must act by all laws and rules as indicated in the Act of April 6, 1937, P.L. 200, known as the Pawnbrokers License Act.
- If the Principal complies with his or her pawnbroker duties as agreed, the obligation shall be null and void, otherwise to be and remain in full force and effect.
- This bond shall continue in full force and effect indefinitely but is subject to cancellation.
- The Surety may elect to cancel this bond at any time by filing with the Secretary of Banking a 30-day written notice of such cancellation.
- The liability of the Surety will not exceed the full penal sum of the bond.
Note: Every pawnbroker license renewal also requires a bond renewal.
Call us now and get bonded today!