Bonds for Appraisal Management Companies

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What is an appraisal management company (AMC) bond?

AMC bonds ensure that appraisal management companies follow state and federal laws for their profession. Acquiring this bond is often a mandatory step in the licensing process for AMCs. It also guarantees that AMCs abide by the surety contract terms (or pay the consequences).

What is an appraisal management company?

An appraisal management company, or AMC, is an independent entity that a mortgage lender will hire to conduct residential real estate valuation services. Acting as a third-party in the home-selling process, an AMC will select a state-qualified or state-licensed appraiser to valuate a property and deliver an appraisal report to the lender.

The United States government developed the guidelines for independent appraisers to avoid lenders influencing appraisals. Lenders, customers, and mortgage brokers cannot choose their own appraisers.

Get Your AMC Bond:

Quick Takeaways

  • AMC bonds ensure that appraisal management companies follow state and federal laws regarding the appraisal profession.
  • You might be denied a new license or lose your current license if you fail to obtain or renew an AMC bond on time.
  • You could pay as little as 1-5% of the total bond amount if you have a good credit score.
  • Bond amounts of $20,000 to $40,000 are typical for this type of bond.

How does an appraisal management company bond work?

An AMC surety bond is a three-party agreement involving:

  • The surety company that underwrites the bond
  • The obligee that requires the bond (county or state licensing department)
  • The principal who needs the bond (AMC)

The bond guarantees the state and public that the AMC will follow industry laws and abide by the bond agreement. If the AMC commits a violation – and the state or an individual files a claim – the surety may step in to resolve the problem. The surety may pay the claimant for their losses upfront. Then the AMC must reimburse them later.

To avoid claims on your bond, carefully abide by all laws and regulations for your profession. Follow industry best practices, and communicate with customers effectively to make the appraisal process as smooth as possible.

What does an appraisal management company bond cost?

How much your AMC bond costs may depend on several factors:

  • Your state’s requirements
  • The bond amount you need
  • The number of business locations you have
  • Your financial credentials (i.e., credit score)

Typically, the stronger your financial history, the less you will have to pay for your bond. With an excellent credit score, you could pay as little as 1-5% of the full bond amount (penal sum). Penal sums of $20,000 or $25,000 are typical for this type of bond. So at 1% of the bond amount, you would pay either $200 or $250 as your annual premium.

Certain states require appraisal management company bonds as part of the licensing process. You could be denied a new license or lose your current license if you fail to obtain or renew an AMC bond on time.

While some states don’t require this bond, the majority do, including Iowa, Colorado, Washington, Louisiana, Nebraska, Arizona, and Tennessee, to name a few. Learn your state’s licensing requirements by visiting your licensing department’s website.

No. Surety bonds are not the same as insurance. Businesses pay a premium for insurance coverage that protects their interests. You may file a claim with your insurance company to get reimbursed for covered damages.

A surety bond doesn’t protect you but your customers if you violate a contract, agreement, or law. Another party has the right to file a claim on your bond in hopes of being reimbursed for any financial loss they’ve experienced.

Get an Appraisal Management Company Bond

ZipBonds is the fastest and most secure way to get the bond you need. We take out the pain of long, complicated applications. In fact, many of our bonds are approved and processed immediately.



Founders Ryan Swalve and Zach Mefferd formed the vision for when they realized how overly complicated it was to help clients place surety. The frustration of being unable to incorporate the technology they’d used in other insurance-focused projects left them thinking “there has to be a better way.”

Fast forward a couple of years, and that better way is the impetus of everything we do at ZipBonds. We constantly look for innovative ways to improve the bonding process for our clients and agents. Our team comprises individuals who understand all angles of surety – for companies, agencies, and individuals. Incorporating everyone’s point of view to improve the process while simultaneously integrating cutting-edge technology is what sets our business apart.