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Army Veteran Owned | Expert Surety Bonds Since 2004
Have a question? +1 815-826-6324 (815-8-BondAI) phil@AmericasSuretyBonds.com
Army Veteran Owned | Expert Surety Bonds Since 2004
If you have been hunting for the Texas statute behind this bond, stop. There is not one. Nothing in the Texas Property Code requires a tenant or a landlord to post a surety bond on a lease. What people call a Texas tenant lease bond is a private lease guarantee bond, written because a landlord asked for it, with the landlord as obligee. That means the lease sets the amount, not the state, so the first thing to send us is the lease language and the figure the landlord wants.
Texas has no statutory tenant lease bond. Chapter 92 of the Texas Property Code, which governs residential tenancies, contains no surety bond provision in its security deposit subchapter. A Texas tenant lease bond is a private lease guarantee bond: a landlord requires it as a condition of the lease, the landlord is the obligee, and the amount, term and claim conditions come from the lease rather than from a statute or an agency. There is no prescribed state form, no filing fee and no license attached to it.
We can help with all Texas bonds!
Worth saying first, because it saves people a lot of searching.
Some states do write a landlord bond into their deposit law. Texas is not one of them. Texas Property Code Chapter 92, Subchapter C covers security deposits across fifteen sections, from application and definitions through refunds, accounting, records, forwarding addresses and landlord liability. Not one of them is a surety bond, and none offers a bond as an alternative to holding a deposit.
So if a Texas landlord has asked you for a lease bond, they are not citing a statute at you. They are asking for security under the lease.
That changes how you should approach it. With a license bond, the state fixes the amount and hands out a form. Here there is nothing to look up.
The Texas State Law Library puts the underlying point plainly: a lease is a contract between a landlord and a tenant, and Texas statutes generally do not dictate what rules a lease can contain, beyond a list of protections a tenant cannot waive. Whatever the lease says about security is what governs.
So the amount is whatever the landlord requires, commonly tied to some number of months of rent or to the value of landlord concessions such as free rent or a build out allowance. The term usually tracks the lease term. What counts as a default, and what the landlord has to prove before claiming, come out of the lease and out of the bond wording the landlord will accept.
Send the lease clause and the figure being demanded. That is the only way to quote this accurately, and it is also how you find out whether the landlord will accept a bond at all or is really asking for a letter of credit or a personal guaranty.
Plenty, just not bonds. Worth knowing because it shapes what a landlord is really protecting against.
A landlord must refund a security deposit on or before the thirtieth day after the date the tenant surrenders the premises. Where any part is withheld, the landlord owes an itemized written breakdown of the deductions when the tenant has paid rent in full and there is no rent dispute. A landlord may not keep any part of a deposit to cover normal wear and tear, which means deterioration from intended use rather than damage from negligence, carelessness, accidents or abuse.
The exposure for getting that wrong is real. A tenant can sue to recover three times the portion of the deposit wrongfully withheld, plus additional amounts.
Chapter 92 does include section 92.111, headed Fee in Lieu of Security Deposit, and section 92.110, Lease Without Security Deposit, Required Notice. Those get confused with bonding because they sound like alternatives to putting money down, and in a sense they are.
They are not surety bonds. They are arrangements between the landlord and the tenant under the lease and the statute, with no surety involved and no third party guaranteeing anything. If a landlord offers you a fee in lieu of a deposit, that is a different conversation from a lease guarantee bond and it is worth being clear which one is on the table.
A lease guarantee bond is underwritten more like credit than like a licence bond, because the surety is standing behind a stream of rent obligations rather than a one time compliance duty.
Expect questions about the business financials, how long the tenant has been trading, the rent as a share of revenue, and the ownership. A strong balance sheet and a modest rent obligation is a straightforward file. A start up with a large rent commitment often is not, and in that case the honest answer may be that a bond is not the right instrument and a letter of credit or a guaranty is what the landlord will end up taking.
None. That is the honest answer and it is the one most people arrive looking for. Texas Property Code Chapter 92, Subchapter C governs residential security deposits across fifteen sections and none of them is a surety bond provision. A Texas tenant lease bond exists because a landlord asked for it in a lease, not because the state requires it.
Whatever the lease says. With a license bond the state fixes the figure. Here there is nothing to look up, so the amount is set by the landlord and is commonly tied to a number of months of rent or to the value of concessions such as free rent or a build out allowance. Send us the clause and the number being demanded.
The landlord, in its exact legal name. Get that from the lease rather than from a sign on the building, because a property is often held by an entity whose name looks nothing like the trading name.
No. Because no statute creates this bond, no agency publishes a form for it. The wording has to be something the landlord will accept, so it is worth getting the landlord to review the form before it is executed rather than after.
You pay a premium rather than the face amount, and this class is underwritten on financial strength rather than on a rate card. The surety is backing a stream of rent obligations, so business financials, trading history, the rent as a share of revenue and ownership credit all drive it. There is no honest percentage to publish for a bond whose size and term are set by a private contract. Send the lease and the amount and we will quote it.
Usually the lease term, because that is the obligation being guaranteed. Some landlords will accept a shorter bond that renews. Both the term and any cancellation rights are negotiated in the lease and in the bond form rather than fixed by law.
No. Texas Property Code section 92.111 covers a fee in lieu of a security deposit, and section 92.110 covers a lease without a security deposit and the notice that goes with it. Those are arrangements between you and the landlord with no surety involved. A lease guarantee bond brings in a third party that pays the landlord and then comes to you for reimbursement. Different products, worth being clear which one is being asked for.
No. It protects the landlord. If the surety pays a claim it seeks reimbursement from you, so the bond moves the landlord's risk rather than removing yours. What it buys you is not having to hand over cash or tie up a credit line for the same amount.
The parts worth knowing: the landlord must refund the deposit on or before the thirtieth day after you surrender the premises, must give an itemized written breakdown of any deductions where rent is paid in full and not in dispute, and may not deduct for normal wear and tear. A tenant can sue to recover three times the portion of a deposit wrongfully withheld, plus additional amounts.
Sometimes, and sometimes the honest answer is no. This is closer to credit underwriting than to a license bond filing. A new business with a large rent commitment is a hard file, and in that situation a landlord will often end up taking a letter of credit or a personal guaranty instead. Worth finding that out early rather than after weeks of back and forth.
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