A bid bond is used as security for bids submitted on a contract. Placing security on a bid guarantees that the bidder will execute the contract at the bid price, upon award of the bid. If security is not submitted with the bid, the bid is rejected. Additionally, if the winning bidder does not enter into a contract, the security is forfeited. (Read more)
Contract bonds are often incorrectly referred to as construction bonds. There are several categories of contract bonds (for example, payment bonds, performance bonds, or subdivision bonds), all of which are three-party agreements between the contract principle, owner as oblige, and the surety. (Read more)
Also known as a warranty bond, a maintenance bond guarantees to the protect owner that, within a certain maintenance term after the project's completion, there will be no faults in the structure. (Read more)
A payment bond, a type of contract bond, guarantees that a contractor will pay suppliers, laborers, and subcontractors (subject to contract terms) for labor and materials. Generally, payment and performance bonds are issued together as one bond, termed a “Performance and Payment Bond”. (Read more)
Performance bonds, a type of contract bond, guarantees that a contractor will adhere to the terms and conditions of a contract. The winning bidder upon award of the contract submits this bond. Generally, performance and payment bonds are issued together as they are closely related. (Read more)
A site improvement bond guarantees that a developer properly installs improvements to an existing structure, in accordance with applicable building codes. This bond says that any public property affected by private improvements will be upgraded as per government requirements. (Read more)
A subdivision bond guarantees that builders, developers, and individual landowners complete improvements made to a subdivision property. This bond, required by local authorities, usually guarantees that the improvements will be made at the expense of the developer and principal of the bond. (Read more)
A supply bond, a type of contract bond, guarantees the supplier will furnish supplies or materials as contracted. Should the supplier default, the surety will underwrite the purchaser of the supplies against any loss. This bond is required by the project owner or state or federal law to secure public construction projects. There are no special markets (bad credit) for this, or any contract bonds. (Read more)
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