Farmington Pawnbroker Bond: A Comprehensive Guide
At a Glance:
- Average Cost: $100 per year or $10 per month
- Bond Amount: $5,000
- Who Needs it: All pawnbrokers operating in Farmington, New Mexico
- Purpose: To protect the public from financial harm if the pawnbroker violates the terms of their license
- Who Regulates Pawnbrokers in Farmington: The Farmington City Clerk
Background
Farmington Code of Ordinances 8-7-36 requires all pawnbrokers operating in the city to obtain a license from the Farmington City Clerk. The Farmington City Council enacted the licensing requirement to ensure that pawnbrokers engage in ethical business practices. To provide financial security for the enforcement of the licensing law, pawnbrokers must purchase and maintain a $5,000 surety bond to be eligible for a license.
What is the Purpose of the Farmington Pawnbroker Bond?
Farmington requires pawnbrokers to purchase a surety bond as part of the application process to obtain a pawnbroker license. The bond protects the public from financial harm if the pawnbroker fails to comply with the regulations set forth in Farmington Code of Ordinances 8-7-39. Specifically, the bond protects the public if the pawnbroker engages in any acts of fraud, or breaches any consumer contracts. In short, the bond is a type of insurance that protects the public if the pawnbroker violates the terms of their license.
How Can an Insurance Agent Obtain a Farmington Pawnbroker Surety Bond?
BondExchange makes obtaining a Farmington Pawnbroker bond easy. Simply log in to your account and use our keyword search to find the “Pawnbroker” bond in our database. Don’t have a login? Gain access now and let us help you satisfy your customers’ needs. Our friendly underwriting staff is available by phone at (800) 438-1162, email, or chat from 7:30 AM to 7:00 PM EST to assist you.
At BondExchange, our 40 years of experience, leading technology, and access to markets ensures that we have the knowledge and resources to provide your clients with fast and friendly service whether obtaining quotes or issuing bonds.
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Is a Credit Check Required for the Farmington Pawnbroker Bond?
No, a credit check is not required for the Farmington Pawnbroker bond. Because the bond is considered relatively low risk, the same low rate is offered to all pawnbrokers operating in the city, regardless of their credit history.
How Much Does the Farmington Pawnbroker Bond Cost?
The Farmington Pawnbroker bond costs just $100 per year or $10 per month.
Who is Required to Purchase the Bond?
Farmington requires pawnbrokers to purchase a surety bond as a prerequisite to obtaining a pawnbroker license. To paraphrase Farmington Code of Ordinances 8-7-1, a pawnbroker is a person who issues loans to individuals that leave their personal property, as collateral, for the broker to sell on condition that the customer may repurchase the property within a fixed period of time.
BondExchange now offers monthly pay-as-you-go subscriptions for surety bonds. Your customers are able to purchase their bonds on a monthly basis and cancel them anytime. Learn more here.
How do Pawnbrokers Apply for a License in Farmington?
Pawnbrokers in Farmington must navigate several steps to obtain a license. Below are the general guidelines, but applicants contact the Business Registration Office for details on the process.
License Period – All Farmington Pawnbroker Licenses expire one year from the date of issuance and must be renewed before the expiration date.
Step 1 – Purchase a Surety Bond
Pawnbrokers must purchase and maintain a $5,000 surety bond.
Step 2 – Complete an Application
Pawnbrokers must submit a completed application to the City Clerk’s Office at the following address:
City of Farmington
800 Municipal Drive
Farmington, NM 87401
Applicants should complete the form in its entirety and submit a $250 annual fee along with the original surety bond form with it. Contact the Business Registration Office for additional assistance.
How do Farmington Pawnbrokers Renew Their License?
To renew their licenses, pawnbrokers can submit a renewal application to the City Clerk’s Office online here. Pawnbrokers must pay an annual $250 license fee before being issued a renewal license. All Farmington Pawnbroker Licenses expire one year from the date of issuance and must be renewed before the expiration date.
What are the Insurance Requirements for Farmington Pawnbrokers?
Farmington does not require pawnbrokers to purchase any form of liability insurance. However, brokers may need to obtain insurance as a prerequisite to obtaining a state business license. Pawnbrokers must purchase and maintain a $5,000 surety bond.
How Do Farmington Pawnbrokers File Their Bonds?
Pawnbrokers should mail their completed bond forms, including the power of attorney, to the City Clerk’s Office at the following address:
City of Farmington
800 Municipal Drive
Farmington, NM 87401
The bond requires signatures from both the surety company that issues the bond and the applicant. The surety company should include the following information on the bond form:
- Legal name, address, and phone number of the entity/individual(s) buying the bond
- Surety company’s name, address, and telephone number
- Date the bond goes is signed
- Notary acknowledgments
What Can Farmington Pawnbrokers do to Avoid Claims Against Their Bonds?
To avoid claims against their bonds, pawnbrokers in Farmington must ensure that they:
- Do not engage in any acts of fraud
- Faithfully honor all consumer contracts
- Maintain all required transaction records
- Return all pledged goods that have been paid for
- Obtain proof of identification during each transaction
What Other Insurance Products Can Agents Offer Pawnbrokers in Farmington?
Most reputable pawnbrokers will purchase liability insurance. Bonds are our only business at BondExchange, so we do not issue any other types of insurance, but our agents often utilize brokers for this specific line of business. A list of brokers in this space can be found here.
How Can Insurance Agents Prospect for Farmington Pawnbroker Customers?
Farmington unfortunately does not provide a public database of active pawnbrokers in the city. We suggest contacting the Farmington City Clerk to obtain this information. Contact BondExchange for additional marketing resources. Agents can also leverage our print-mail relationships for discounted mailing services.