SBA Guarantee Program | SBA Surety Bonds
General Information about the SBA Bond Guarantee Program
The SBA guarantees bid, performance and payment bonds issued by surety companies. This guarantee encourages surety companies to bond small businesses who are having difficulty obtaining bonding on their own. For the past ten years, the Surety Bond program maintained a steady upward trend in every key measure, including the number of bond guarantees issued, contract dollars awarded to small businesses and number of small businesses assisted. To assure continued growth of the program, SBA implemented several enhancements geared toward streamlining the underwriting process and providing easier access for surety companies.
The Quick Bond Guarantee Application can be used for contracts valued at $400,000 or less and reduces the majority of paperwork and other underwriting information required of sureties and small businesses on larger contracts. The Quick App allows SBA and surety companies to issue bonds faster for small businesses.
The SBA Bond Guarantee Program was developed by the Federal Government to help small to medium and emerging contractors gain more access to surety bonds. Surety bonds are required on many projects at many government levels as well as some private construction projects. In order to obtain a bond a surety must underwrite the performance capabilities and financial strength of a contractor.
The SBA Bond Guarantee Program is designed to limit the risk to a surety on contractors that fit in the program. This generally allows a surety bond underwriter to approve more bonds for smaller contractors that might not have otherwise qualified on their own for bonding.