Some municipalities in the state of Texas require secondhand goods dealers to hold surety bonds as a prerequisite to conducting business in their city. These bonds are typically inexpensive, for instance, $100 or less for a bond worth $1,000. This is the rate, for example, in the city of Midland, Texas. These bonds are sometimes also referred to as Junk Dealer bonds. They ensure that principals conduct business in accordance with all laws and rules and regulations. If the principal fails to do this and violates any terms of the surety bond agreement, the bond protects the city from financial loss up to the full penal sum of the bond.