Also my portfolio will never be touched. 1 percent of the face value of the bonds, meaning 10 percent of the 10 percent premuim of all bonds I write go into a buf which is a build up fund. When I get a final judgement and am unable to get money from a judgment I just cut a check out of the build up fund before the Court cashes the surety bond. The guys that bail through a surety company also have a build up fund of the 21 percent of the premuim they pay to the surety company part of that goes into their buf kept by surety. So if they do 1 million face value for the year they make 100k in premuim surety gets 21k, surety keeps 11k and 10k goes the the buf. The agent makes 79k in premuim and has 10k in his buf. when he retires he gets everything in his buf. The numbers can get confusing because of percentages of percentages. I write roughly 300 bonds a year with around 1.5 million in face value so each bond is only about a 5k average. So you can see how 2 or 3 forfitures doesn't hurt the 150k in premuim to much. I do about 5-6 a week on average roughly 25 hours a week. They also pay a processing fee of $50 that covers the paperwork cost.
I make 100% roi on a 100k portfolio every year.
- Thread starter BondingInvestor
- Start date
"So if you ever spend money on recovering the bail money, the expenses to recover the bail that you incur like the expenses that you pay to bounty hunters to track down the defendant would be paid by the defendants? What if the defendant just turns around and murders you (God forbid, I wish you all the long life and good health) after they skip bail so that way they won't have to worry about paying nobody no nothing anymore? Is that a bona fide risk in bail bonds writing? I mean is your identity known to the criminals? Aren't you scared of that possibility? Do you have to invest in personal safety measures?"
That depends on what kind of people you bail out. My core customer is usally life long locals who made a mistake, got a dwi or drug posession charge, or got in a fight with their wife and pushed her. I dont like bailing out meth addicts they are the worst. You can usually tell just by their speech speed and the way they talk when they call. You get a feel for people in this business. I do bail out a small percentage of career criminals. There is a small percentage of them that won't ever run they have a mindset that going to prison or Jail is part of their business I guess you could say. They are criminals but take care of their obligations. It's hard to understand unless you are in this line of work. They are easy to spot on background checks. They will have a lot of previous charges with high bonds and never have missed court, and after prison sentences they check themselves in freely. Meaning they get sentenced to 7 years in prison but don't have to check in until next month, and they freely check on that date.
If you are are bailing out pieces of shit that never show up for court and are dope heads that have zero moral compass then yea I would be concerned.
The business pretty much comes down to this. You could write every bond and never turn anybody down take no collateral make a huge amount of money the first 1 or 2 years then when you start getting huge amounts of forfitures the 3rd year you'll be bankrupt and the Court will take everything from you. Or you can be conservative do good risk assessment and make a really good return.
That depends on what kind of people you bail out. My core customer is usally life long locals who made a mistake, got a dwi or drug posession charge, or got in a fight with their wife and pushed her. I dont like bailing out meth addicts they are the worst. You can usually tell just by their speech speed and the way they talk when they call. You get a feel for people in this business. I do bail out a small percentage of career criminals. There is a small percentage of them that won't ever run they have a mindset that going to prison or Jail is part of their business I guess you could say. They are criminals but take care of their obligations. It's hard to understand unless you are in this line of work. They are easy to spot on background checks. They will have a lot of previous charges with high bonds and never have missed court, and after prison sentences they check themselves in freely. Meaning they get sentenced to 7 years in prison but don't have to check in until next month, and they freely check on that date.
If you are are bailing out pieces of shit that never show up for court and are dope heads that have zero moral compass then yea I would be concerned.
The business pretty much comes down to this. You could write every bond and never turn anybody down take no collateral make a huge amount of money the first 1 or 2 years then when you start getting huge amounts of forfitures the 3rd year you'll be bankrupt and the Court will take everything from you. Or you can be conservative do good risk assessment and make a really good return.
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Also the courts like bondsman because we don't need extradition or warrants. We are protected by Supreme Court case law Taylor v. Taintor. So if a defendants has a charge and is on Bail and skips to another state and is arrested he can fight extradition through the Court. But a bondsman doesn't need extradition approval, the defendant waived it through the bail contract. So we fly down take him from the jail and fly him back to jurisdiction and him fighting extradition is moot.
It is up to the judge to decide bail so if the person is not a flight risk or serious danger then bail is awarded. All OP is doing is running a business that allows them to get out with a down payment and collateral to ensure they show up. Otherwise people would skip out on bail constantly.
I am not going to argue, just go to https://www.pretrial.org/ and read their material. It's a virtually unregulated industry with a bunch of assholes ripping faces of poor people (in fees and unreturned collateral).
PS. it should be pretty obvious that it's a shady business simply by the virtue of their return rates
PS. it should be pretty obvious that it's a shady business simply by the virtue of their return rates
So bail bonds return 9% a year over the long-run? You know what else returns 9%? Junk bonds. Yet it is not a good idea to lever up 15x. And yes, they also have recourse and plenty of investors think they do credit analysis well. Yet anyone leveraged 15x in Junk bonds is surely is going to go out of business at some point. Eventually there will be a recession or the credit cycle will turn, your default rate will rocket higher. I'm not sure how the law works in these cases and maybe you can clarify but if you lose $300K in defaults, do the courts have a recourse against you after they go through your initial collateral? If they do, then your risk is a lot higher than you think. Plenty of people have lost huge amounts doing levered credit analysis, thats pretty much how banks go bust
Why? From watching his TV show, he seemed professional and did not seem to use excessive force. He sometimes had to use precaution against some really violent felons but I think that force was justified when you are dealing with the really crazy ones.