What Are Texas Construction & Contractor License
Bonds?
Texas requires several construction‑related surety bonds to protect project owners, subcontractors, suppliers, and the public. These bonds ensure contractors follow Texas laws, honor contracts, and complete work properly.
This page covers:
- Texas Bid Bonds
- Texas Performance & Payment Bonds
- Texas Contractor License Bonds (city‑specific)
- Texas Pre‑Qualification Bonds
Each bond type supports a different stage of the construction process.
Texas Bid Bond
A Texas Bid Bond guarantees that a contractor will honor their bid and sign the contract if awarded the project. It protects project owners from:
- Bid withdrawal
- Refusal to sign the contract
- Failure to provide performance & payment bonds
Typical Pricing: Most bid bonds are issued at no cost for qualified contractors.
Texas Performance & Payment Bond
Texas Performance & Payment Bonds guarantee:
- The project will be completed according to contract
- Subcontractors and suppliers will be paid
These bonds are required for:
- Public works projects
- Many private commercial projects
- General contractors and specialty trades
Typical Pricing: Rates typically range from 1%–3% of the contract amount for qualified applicants.
Texas Contractor License Bond
Texas does not have a statewide contractor license bond requirement, but many cities and counties require one, including:
- Houston
- San Antonio
- Dallas
- Fort Worth
- Austin
- El Paso
These bonds ensure compliance with local building codes and regulations.
Typical Pricing: Most city contractor license bonds cost $50–$250 annually, depending on bond amount and credit.
Texas Pre‑Qualification Bond
Some Texas public agencies require a Pre‑Qualification Bond to verify a contractor’s:
- Financial strength
- Experience
- Ability to complete future projects
This bond strengthens a contractor’s eligibility for bidding.
Typical Pricing: Most pre‑qualification bonds cost 1%–3% of the bond amount.
Texas Construction Bond Cost
Your premium depends on:
- Bond type
- Bond amount
- Credit score
- Financial history
- Project size (for contract bonds)
General Pricing Ranges:
- Bid Bonds: Often free
- Performance & Payment Bonds: 1%–3% of contract
- Contractor License Bonds: $50–$250 annually
- Pre‑Qualification Bonds: 1%–3% of bond amount
Who Needs a Texas Construction Bond?
You need a construction bond in Texas if you are:
- A general contractor
- A subcontractor
- A specialty trade contractor
- A construction company bidding public or private work
- A contractor required to meet city licensing rules
Texas Construction Bond Requirements
Texas requires:
- Completed bond application
- Credit review
- Financial statements (for larger contract bonds)
- Bond amount based on project or city requirement
- Filing with the appropriate city or project owner
How to Get a Construction Bond
1
Complete the Application
Submit contractor information, financials, and project details.
2
Secure the Lowest Rate
Matched with the best pricing from A‑rated sureties.
3
Receive your bond
Issued digitally for immediate filing; larger performance bonds may require deeper underwriting.
Why Choose Us for Your Construction Bonds
- Lowest rates from A‑rated sureties
- Fast approvals
- Digital delivery for immediate filing
- Dedicated construction bond specialists
- 100% compliance guaranteed
Top Construction Bond Questions Answered
Our most common questions answered efficiently.
Yes. Federal and state laws mandate bonding for most public works.
Yes. Programs exist for new and growing contractors.
Indirectly. They help win jobs, but the protection is for owners and subcontractors.
The surety may complete the project or compensate the owner.
Sureties review credit, but bonds do not appear as debt.
