Pawnbroker Bond (Pawn Shop Bond)

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Bond Penalty Set by State Law

Pawn brokers are considered a form of pseudo-financial institution and are therefore regulated. A pawnbroker bond is currently required by approximately twenty states and many municipalities. Generally the surety bond amount is small and guarantees only that the pawn operator will operate withing the confines of the law, although some bond forms contain provisions that protect third parties from damages resulting from the pawnbroker's acts. Duties of a pawnbroker secured by the surety bond include:

  • Compliance with state code and administrative regulations.
  • Receive property on pawn and securely warehouse the same.
  • Maintain proper ownership records.
  • File required reports with the pawnshop regulator.
  • Return property promptly and in the condition in which it was received.
  • Follow appropriate legal procedures when liquidating forfeited property.

It is important to keep in mind that over ten cities, villages, townships and counties require a pawnshop bond from operators LOCALLY. Filing of a surety bond with the state may NOT exempt the pawn operator from compliance with local municipal codes.

In 2008, the Nationwide Multistate Licenseing System (NMLS) created by the Conference of State Bank Supervisors (CSBS) and the American Association of Residential Mortgage Regulators, began operation. It is THE system of record for non-depository, financial services licensing or registration in participating state agencies. A pawnshop seeking a state (not local) license may be obligated to file its pawnbroker surety bond through this system. Surety One, Inc. is a credentialed NMLS e-bond writer so “same day” pawbroker filing is available.

National surety bond leader, Surety One, Inc. is a specialist in the bonding needs of the pawnbroker / pawn shop industry. We offer both surety and fidelity bonds in support of pawn operations in all fifty states, Puerto Rico and the U.S. Virgin Islands. Feel free to contact us with your questions about pawnbroker bonds or any other surety bond need in support of your enterprise.

Surety bond application review and quoting are free of charge. There is no obligation to purchase.

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