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SBA Surety Bond Guarantee Program

Taking your construction company to the next level isn’t easy without the right support. It requires your company to bid on larger contracts, thereby increasing your bonding capacity. The U.S. Small Business Administration (SBA) Surety Bond Guarantee Program helps contractors overcome traditional underwriting barriers by providing a federal guarantee to surety companies.

Surety Bond Professionals (SBP) is a family-owned and operated bonding agency with over 100 years of experience. With access to a broad range of surety markets, our SBA-authorized surety agents are ready to assist you with securing a surety bond backed by the Surety Bond Guarantee Program.

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Learn more about the SBA Surety Bond Guarantee program or contact our SBA Authorized Surety Agents for assistance with any questions you may have.

US Small Business Administration Authorized Surety Agent

Approved to offer SBA guaranteed bonds through the SBA’s Surety Bond Guarantee Program.

An SBA surety bond is a guarantee the government gives to authorized surety organizations. Instead of doing this with contractors directly, the SBA guarantees between 70%-90% of the bond amount for projects valued up to $9 million for non-federal contracts and up to $14 million for federal contracts, issued by a participating surety company. Companies can then offer bid bonds to small businesses that typically don't qualify for traditional bonds through standard means. The backing of a federal guarantee significantly reduces the risk for surety companies. This means they can approve more, larger bonds for contractors who struggle to obtain them in the standard marketplace. The SBA Surety Bond Guarantee Program continues to help small businesses get the bonding they need.
The construction industry landscape is challenging without strong financial backing. The SBA bond program helps emerging businesses that are ready to scale in many ways, including:

  • Contract value: Gaining more ability to qualify for contracts that range from $9 million to $14 million, increasing potential contract value.
  • New project opportunities: Securing bid, performance, and payment bonds helps contractors compete for new projects and supports business expansion.
  • Reduced underwriting friction: Leveraging a process that favors small and emerging contractors without having to rely on traditional market avenues.
  • Clear pathways: Creating a clear pathway to establish a presence and experience of working in the public sector.
SBP's dedicated surety agents work closely with contractors to leverage these SBA benefits, turning them into a long-term strategic program for your company instead of a one-off bond.
To qualify for assistance from the SBA Surety Bond Guarantee Program, a business must meet certain criteria related to:

  • Business size: The company must meet the SBA’s definition of a small business, based on industry standards and revenue at the time of application.
  • Bond specifics: The program applies specifically to construction-related contract bonds. This covers bid bonds, performance bonds, and payment bonds. It doesn't apply to license bonds.
  • Contract size: Non-federal contracts for less than $9 million and federal contracts up to $14 million will qualify for an SBA guarantee.
  • Underwriting criteria: Applicants must meet the SBA's standards for creditworthiness, capacity, and character. This will include a review of financial statements, repaid debts, credit history, and integrity.
The SBA bond program works with your surety company by guaranteeing a specific amount of the bond. Doing so allows bonding companies to support more complex cases and increase opportunities for small businesses. Our expert surety agents evaluate your current standing and guide you on exactly where you stand in the bonding process to ensure you meet SBA criteria.
The specifics of determining the appropriate bond type may vary by project, but some of the surety bonds the SBA program can help you secure through a surety agency include:

  • Bid bonds: A bid bond ensures that contractors proceed with entering into a contract if they are the low bidder. It's a way of preventing project owners from wasting time and money if the bidder backs out later. By compensating project owners for the costs of restarting the bidding process, it safeguards their financial position.
  • Performance bonds: A performance bond guarantees that the contractor will complete the project per the contract terms. It's most commonly required on public construction projects. It's also becoming a popular choice for private owners, who are increasingly using these bonds to protect their investments and prevent potential financial losses.
  • Payment bonds: A payment bond guarantees that the contractor will pay all laborers, material suppliers, and other contractors in accordance with the original contract agreement. They protect against potential nonpayment if a contractor becomes insolvent.
  • Maintenance bonds: A maintenance bond, also known as a warranty bond, protects the project owner from financial loss if defects are found after the project is complete.
There are also supply bonds, which guarantee material delivery. These may be required for supply-only contracts instead of P&P bonds.
Choosing the right bonding agency for an SBA bond program is crucial. If your business is ready to scale but your bonding program isn't keeping pace, you risk losing valuable contracts. The successful growth trajectory of your company requires long-term advocacy and a long-term strategic bond partner. Our goal is to empower contractors by providing the support they need to grow out of the surety bond program into standard surety markets.

SBP is a family-owned business with over 100 years of experience and access to over 40 distinct surety markets. We don't just process your paperwork. Instead, we dedicate time and effort to understanding your project pipeline, financial health, and future business goals. We then design a surety program that aligns with these goals. This helps our surety agents better advocate for your company and deliver the right SBA surety program for today and the future.

Get Started With Your SBA Surety Bond Program Today

It doesn’t matter if you’re establishing your first bonding program or looking to expand your limits. We’re ready to support your long-term growth. Trust SBP and begin working on being awarded your next major contract. By explaining the nuances and strategic benefits of an SBA bonding program, our experts align your goals with the surety bond landscape.

Are you a contractor looking for a strategic partner who anticipates your needs and provides expert support that evolves with your business? Make sure you’re ready for the next bid opportunity. Contact Surety Bond Professionals today to schedule your complimentary consultation and discuss your SBA bonding strategy today.

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Our surety bond professionals will help you get the construction bonds you need through the SBA Surety Bond Guarantee Program with the largest single/aggregate capacity and best terms possible.

Request a Surety Program Review

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