Washington Collection Agency Bond
Washington requires a $5,000 surety bond to license a collection agency under RCW 19.16.190 — the smallest fixed penal sum of any collection-agency bond we track, and cheap enough that most agencies pay around $100 a year for it. The part that actually trips agencies up isn't the bond — it's that an out-of-state agency collecting Washington debts by phone or mail still needs a Washington license, even in the (common) case where the bond itself gets waived.
$5,000
Fixed penal sum — RCW 19.16.190
~$100/yr
Typical premium for qualifying agencies
Jan 1
Fixed annual renewal date, every year
Written on Washington's own bond form, filed with the Department of Licensing. Comparing states first? See collection agency bond requirements in every state or run your number in the collection agency bond calculator.
- Who requires it: The Washington Department of Licensing (DOL), under RCW 19.16.190, for a collection agency license (unless exempt under RCW 19.16.190(2)).
- Amount: $5,000 for all Washington-licensed collection agencies (no tiering by size or volume).
- Timing: Same-day submission; most quotes within one business day.
The bond can be waived. The license almost never is.
Washington's licensing trigger is where the debtor lives, not where the agency has a desk. An out-of-state collection agency that never sets foot in Washington still needs a Washington license the moment it — or a third party working on its behalf — contacts a Washington resident about a debt. Agencies read the bond-exemption language in RCW 19.16.190 and stop there, assuming the whole compliance obligation disappears with it. It doesn't.
What the bond exemption actually covers
RCW 19.16.190 lets an out-of-state agency skip Washington's $5,000 bond if it already maintains an adequate bond or legal alternative required by its home state. That's a narrow carve-out on one line item — the surety bond — submitted as proof with your application, not a blanket exemption from Washington law.
What still applies regardless
The out-of-state collection agency license itself, the Business License Application, the $7,500 minimum financial standard, and — unless you're a pure debt buyer — the trust account requirement. Skipping the bond doesn't skip the license application it's attached to.
Collecting Washington debts without a license — even remotely, even by phone from another state — is unlicensed activity under Chapter 19.16 RCW. If your home-state bond doesn't qualify as “adequate” under the director's review, or you never submitted proof of it, Washington's $5,000 bond applies to you the same as any in-state agency.
Why $5,000 is the floor, not the ceiling, in this vertical
Collection agency bond amounts vary more than almost any other license bond category — from a flat $5,000 in Washington to a $50,000 fixed sum in Florida, with several states tiering the number to revenue or collection volume. Washington has never moved off its original flat figure.
Collection agency bond amounts: Washington vs. the rest of the vertical
Washington's flat $5,000 is the smallest fixed penal sum we track in this category
| State | Bond Amount | Statute | Structure |
|---|---|---|---|
| Washington | $5,000 | RCW 19.16.190 | Flat — same for every licensee |
| Texas | $10,000 | Tex. Fin. Code §392.101 | Flat — filed with Secretary of State |
| New York City | $5,000 | NYC Admin. Code Title 20 | Flat — city-level requirement |
| Colorado | $12,000–$20,000 | CRS 5-16-119 | Sliding scale by collection volume |
| California | $25,000 minimum | Cal. Fin. Code §100019(e) | DFPI-set, can run higher |
| Florida | $50,000 | Fla. Stat. §559.545 | Flat — commercial agencies only |
A flat $5,000 penal sum, at typical 1%–3% premium rates for qualifying credit, is why most Washington agencies land near $100/year — often the least expensive compliance bond a licensed agency carries.
Verified against each state's statute; see /collection-agency-bonds/ for full sourcing
What the $5,000 bond actually costs to carry
Premium on a Washington collection agency bond is priced as a percentage of the $5,000 penal sum, underwritten mainly on the owner's personal credit. Because the bond amount itself is fixed and small, even agencies with credit challenges rarely pay much more than the price of a routine renewal elsewhere.
Washington $5,000 collection agency bond — estimated annual premium by credit tier
Based on a $5,000 bond amount
- Excellent (700+)Rate: 1%–2%$50–$100
- Good (650–699)Rate: 2%–3%$100–$150
- Fair (600–649)Rate: 3%–5%$150–$250
- Building credit (below 600)Rate: 5%–10%$250–$500
Estimated ranges based on typical surety underwriting for small fixed-amount license bonds; not a quoted rate. Request a quote for your agency's actual premium.
Curious how premium is calculated across every bond type, not just this one? Read how surety bond cost is calculated.
What triggers a claim: late remittance, not just theft
Washington's bond is conditioned narrowly on two things — faithfully performing agreements with your clients or customers, and accounting for and paying over collected funds within 30 days after the close of each calendar month. That second condition is a hard deadline, not a general honesty standard: an agency that collects on time but pays its clients late is already in breach of the bond's terms, separate from any question of misappropriation.
Official Washington Requirements
"Each applicant for a collection agency license... shall file... a surety bond in the sum of five thousand dollars... The bond shall run to the state of Washington as obligee for the benefit of the state and conditioned that the licensee shall faithfully and truly perform all agreements entered into with the licensee's clients or customers and shall, within thirty days after the close of each calendar month, account to and pay to his, her, or its client or customer the net proceeds of all collections made during the preceding calendar month."Revised Code of Washington §19.16.190 • RCW 19.16.190
Renewal, cancellation, and the cash-deposit alternative
Annual renewal on January 1 — not your issue anniversary
The bond is annually renewable on January 1 of each year, regardless of when it was first filed. A license approved in October still needs a renewed bond on file by the following January 1, not twelve months from the approval date.
Two clocks run if your surety withdraws: 60 days and 30 days
A surety exits by filing a withdrawal notice with the director, and stays on the hook for the licensee's future acts for 60 days after that notice (or until a new bond is filed, whichever is first). Separately, once the director mails you notice of the withdrawal, you have only 30 days from that mailing to file a replacement bond or your license terminates — don't assume the 60-day surety-liability window is your filing deadline. The same 30-day clock applies if the director cancels your bond because your surety company's own license was revoked; affected licensees are notified by certified mail.
Cash deposit ties up money longer than a bond does
Instead of a surety bond, you can post a cash deposit or other negotiable security the director accepts. It isn't returned until a year after your license expires, and only if no legal action was filed against it in that window — a $5,000 bond at roughly $100/year is the far cheaper option for most agencies.
How to license and bond your agency in Washington
Determine which Washington license you need
In-state license: your main office is in Washington, or you have (or plan to have) Washington clients — requires a Washington office managed by a state resident. Out-of-state license: you contact Washington debtors directly, or through a third party, on behalf of out-of-state clients, even with no physical Washington presence.
Check whether your home-state bond covers the RCW 19.16.190 exemption
Out-of-state agencies that already maintain an adequate bond or legal alternative where they are located can submit proof of that coverage to the DOL instead of buying a new Washington bond. Gather your existing bond documentation before you apply — approval isn't automatic.
If not exempt, secure the $5,000 surety bond
File a surety bond in the sum of $5,000, running to the State of Washington as obligee, written by a surety authorized to do business in Washington, conditioned on faithfully performing client agreements and remitting collected funds within 30 days of month-end.
Meet the DOL's financial standards
Show at least $7,500 in cash or equivalent (with $5,000 of it deposited in a business operating account) and a net worth of $7,500 or more. Maintain a federally insured trust account for client funds — debt buyers collecting only their own purchased debt are exempt from the trust-account requirement.
File the Business License Application and location supplement
Submit your Secretary of State registration, Business License Application, a location supplement for each office, a financial statement covering the past three months, and the surety bond agreement (or exemption proof) through the Department of Revenue's Business Licensing Service.
Renew the bond every January 1
Washington's collection agency bond renews annually on January 1, regardless of when your license was first issued — build that fixed date into your compliance calendar rather than tracking a rolling anniversary.
Where to file
Applications route through the Department of Revenue's Business Licensing Service on behalf of the Department of Licensing. Read the DOL's own collection agency licensing requirements for the current forms and financial-statement checklist before you apply.
Need the $5,000 bond, or proof for the exemption?
We place Washington's DOL-form bond in the exact $5,000 penal sum, or help you assemble the home-state bond documentation for the RCW 19.16.190 exemption.
Get my Washington collection agency bond quoteWashington collection agency bond questions
My agency has no office in Washington — do I still need a license and bond?
Almost certainly the license, and probably not the bond. Washington's collection agency law reaches any agency contacting Washington debtors, whether directly or through a third party working on behalf of an out-of-state client — the trigger is where the debtor lives, not where your desk sits. The Department of Licensing issues a separate out-of-state collection agency license for exactly this situation. Where agencies get tripped up is assuming the bond exemption (see below) means the whole license is waived — it doesn't. You still file the out-of-state license application; only the $5,000 bond itself can be skipped if you already carry adequate coverage at home.
How does the out-of-state bond exemption in RCW 19.16.190 actually work?
RCW 19.16.190 states that an out-of-state collection agency "need not fulfill the bonding requirements under this section if the out-of-state collection agency maintains an adequate bond or legal alternative as required by the state in which the out-of-state collection agency is located." In practice that means submitting proof of your home-state bond (or its legal equivalent, like a cash deposit) to the DOL in place of a new Washington bond. It is not automatic — you have to document it as part of the application, and the director decides whether what you're carrying qualifies as adequate. If your home state has no bonding requirement at all, there's nothing to submit, and Washington's $5,000 bond applies to you directly.
Why is Washington's bond only $5,000 when California and Florida run $25,000-$50,000?
Washington set a flat $5,000 figure in RCW 19.16.190 and has never tiered it by revenue, collection volume, or agency size the way Arizona or Colorado do. California's Debt Collection Licensing Act and Florida's commercial collection agency statute both anchor to a larger, discretionary or fixed penal sum tied to different consumer-protection frameworks. Washington's bond is also narrower in what it's conditioned on — faithful performance of client agreements and timely remittance of collected funds — rather than broader conduct guarantees, which is part of why the state can justify a smaller number. For the agency, the practical effect is the lowest fixed-dollar bond of any state we track in this vertical.
Can I post a cash deposit instead of buying a bond?
Yes. RCW 19.16.190 lets you substitute "a cash deposit or other negotiable security acceptable to the director" for the surety bond. The deposit sits with the state and isn't returned until a year after your license expires, and only if no legal action was filed against it during that time. For most agencies this ties up $5,000 in cash for years longer than a bond premium would — a $100/year bond is the cheaper option unless you have a specific reason to avoid underwriting.
What happens if my surety cancels my Washington bond mid-year?
The surety files a withdrawal notice with the director, and its liability under the old bond for the licensee's future acts continues for 60 days after that notice, or until a new bond is filed, whichever comes first. Separately, once the director mails you notice of the withdrawal (by registered or certified mail), you have 30 days from that mailing to file a replacement bond with a surety satisfactory to the director — miss that 30-day window and your license terminates. The same 30-day clock applies if the director cancels your bond because your surety company's own license to do business in Washington was revoked.
Does Washington's $5,000 bond cover debtors who think an agency ripped them off?
Not directly. The bond runs to the State of Washington as obligee, and is conditioned on the licensee faithfully performing agreements with its clients or customers and, within 30 days after the close of each calendar month, accounting for and paying over the net proceeds of everything collected. That protects the businesses and creditors who hired the agency to collect on their behalf — the entities whose money is passing through the agency's hands — more directly than it protects individual debtors, whose primary recourse for collection misconduct runs through the state's consumer protection and FDCPA channels rather than this specific bond.
Other Washington license bonds
Agencies licensed through Washington's DOL, DFI, or L&I often carry more than one of these:
All content is researched from official state and federal sources (.gov). BuySuretyBonds.com works with Treasury-listed surety carriers.
General information, not legal or licensing advice. Washington's Chapter 19.16 RCW collection agency framework, the $5,000 bond amount, and the Department of Licensing's application process are set by statute and rule and change over time. Confirm your classification and current requirements with the Washington Department of Licensing before filing, and request a quote for your specific bond.
File your Washington collection agency bond
Tell us your agency type and where you collect and we'll write the $5,000 DOL-form bond, or confirm whether the RCW 19.16.190 exemption applies to you — free quote, no obligation.