Sherman Junk/Secondhand Dealer Bond: A Comprehensive Guide
March 13, 2023
At a Glance:
- Average Cost: $100 per year
- Bond Amount: $1,000
- Who Needs it: All junk dealers and secondhand dealers operating in Sherman, Texas
- Purpose: To protect the public from financial harm if the dealer violates the terms of their permit
- Who Regulates Junk/Secondhand Dealers in Sherman: The Sherman City Clerk’s Office
Sherman Code of Ordinances 4.07.041 requires all junk dealers and secondhand dealers operating in the city to obtain a permit from the City Clerk’s Office. The Sherman City Council enacted the permitting requirement to ensure that secondhand dealers engage in ethical business practices. To provide financial security for the enforcement of the licensing law, junk dealers and secondhand dealers must purchase and maintain a $1,000 surety bond to be eligible for a permit.
What is the Purpose of the Sherman Junk/Secondhand Dealer Bond?
Sherman requires junk dealers and secondhand dealers to purchase a surety bond as part of the application process to obtain a permit. The bond protects the public from financial harm if the secondhand dealer fails to comply with the regulations set forth in Sherman Code of Ordinances 4.07.050. Specifically, the bond protects the public if the secondhand dealer engages in any acts of fraud, breaches any consumer contracts, or fails to provide all goods that have been paid for. In short, the bond is a type of insurance that protects the public if the secondhand dealer violates the terms of their permit.
How Can an Insurance Agent Obtain a Sherman Junk / Secondhand Dealer Surety Bond?
BondExchange makes obtaining a South Carolina 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 Sherman Junk/Secondhand Dealer Bond?
No, a credit check is not required for the Sherman Junk/Secondhand Dealer bond. Because the bond is considered relatively low risk, the same low rate is offered to all pawnbrokers operating in the state, regardless of their credit history.
How Much Does the Sherman Junk/Secondhand Dealer Bond Cost?
The Sherman Junk/Secondhand Dealer bond costs just $100 per year.
Who is Required to Purchase the Sherman Junk/Secondhand Dealer Bond?
Sherman requires junk dealers and secondhand dealers to purchase a surety bond as a prerequisite to obtaining a permit. To paraphrase Sherman Code of Ordinances 4.07.001, a secondhand dealer is a person who purchases or collects secondhand furniture, machinery, jewelry, clothes, or other property from a person who is not a wholesaler, for the purpose of reselling or exchanging the property. Likewise, a junk dealer is a person who purchases or sells any of the items listed under Section 4.07.001. Licensed pawnbrokers are exempt from the licensing requirement and are not required to purchase this bond.
How Do Junk/Secondhand Dealers Apply for a Permit in Sherman?
Junk dealers and secondhand dealers in Sherman must navigate several steps to obtain a permit. Below are the general guidelines, but applicants should contact the City Clerk’s Office for details on the process.
Permit Term – All Sherman Junk/Secondhand Dealer Permits expire one year from the date of issuance and must be renewed before the expiration date.
Step 1 – Meet the Qualifications
To be eligible, junk dealers and secondhand dealers must ensure they meet the following criteria:
- Must be at least 18 years old
- Must be of good moral character
- Have not been convicted of a felony that directly relates to the duties and responsibilities of a junk/secondhand dealer
Step 2 – Purchase a Surety Bond
Junk dealers and secondhand dealers must purchase and maintain a $1,000 surety bond.
Step 3 – Submit an Application
Junk dealers and secondhand dealers must submit their completed application to the City Clerk’s Office by mail or in person at the following address:
220 W Mulberry Street
Sherman, TX 75090
Dealers must complete the application in its entirety and ensure they submit the following items:
- $25 permit fee
- Surety bond
- Photocopy of driver’s license
- Junk / Secondhand Dealer Affidavit
- Authorization of information release form
All permit applications will be processed and approved within 24 hours of submission. Contact the City Clerk’s Office for additional assistance in the application process.
How Do Sherman Junk/Secondhand Dealers Renew Their Permits?
To renew their permit, junk dealers and secondhand dealers should contact the City Clerk’s office to obtain a renewal application. Dealers must pay a $25 renewal fee and ensure that they renew their surety bond to avoid termination of their permit. All Sherman Junk/Secondhand Dealer Permits are valid for one year from the date of issuance and must be renewed before the expiration date.
What are the Insurance Requirements for Junk/Secondhand Dealers in Sherman?
Sherman does not require junk dealers and secondhand dealers to purchase any form of liability insurance. However, dealers may need to obtain insurance as a prerequisite to obtaining a state business license. Junk dealers and secondhand dealers must purchase and maintain a $1,000 surety bond.
How Do Sherman Junk/Secondhand Dealers File Their Bonds?
Junk dealers and secondhand dealers should deliver their completed bond forms, including the power of attorney, to the Sherman City Clerk at the following address:
220 W Mulberry Street
Sherman, TX 75090
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 phone number
- Date the permit expires
- Date and location the bond is signed
What Can Sherman Junk/Secondhand Dealers do to Avoid Claims Made Against Their Bonds?
To avoid claims on their bonds, junk dealers and secondhand dealers in Sherman must ensure that they:
- Do not engage in any acts of fraud
- Faithfully honor all consumer contracts
- Provide all goods that have been paid for
- Do not conduct business with any minors
- Maintain all required records
What Other Insurance Products Can Agents Offer Junk/Secondhand Dealers in Sherman?
Most reputable junk dealers and secondhand dealers 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 Sherman Junk/Secondhand Dealer Customers?
Sherman unfortunately does not provide a public database of active junk dealers and secondhand dealers in the city. However, we suggest contacting the City Clerk to obtain this information. Contact BondExchange for additional marketing resources. Agents can also leverage our print-mail relationships for discounted mailing services.