What is a Bid Bond in Nebraska?
A bid bond is a type of surety bond, that guarantees that the bidder will take the job and complete the agreement according to its terms. It provides assurance to the project owner that the bidder has the expertise and ability to finish the job once you are selected after the bidding process. The simple reason is that you need one so that you get the contract. But the bigger question is why are more owners/developers requiring a surety bid bond? The basic answer is risk. Given the uncertainty of the marketplace, which includes long-time contractors closing shop, to municipalities filing bankruptcy (or just slow paying), has led to owners being afraid that their contractors will be unable to complete the job. Accordingly, they require a some protection.
Just fill out our bond application here and email it to [email protected] - click here to get our Nebraska Bid Bond Application
A bid bond is issued as part of a bid by a surety bond company to the project owner. The owner is then assures that the winning bidder will take on the contract under the terms at which they bid.
Most bid bonds contain a bid percentage (usually five or ten percent, is forfeited if you don’t accept the job).
How much does a Bid Bond Cost in Nebraska?
Swiftbonds does not charge for a surety bid bond (with two exceptions, see below). The reason that we don't charge for a bid bond is that we will charge for the P&P bond if you get the job. The cost of a P&P bond can vary widely depending on the amount of coverage that is required (see below).
Two exceptions for bid bond charges:
1) We do charge for Overnight fees
2) We will charge you if there is NOT going to be a performance bond.
How much do bonds cost in NE?
Bond prices fluctuate based on the job size (that is, it's based on the cost of the underlying contract). The cost of a bond is estimated through a couple of back-of-the-envelope calculations. In general, the cost is approximately three percent (3%) for jobs under $800,000 and then the percentage is lower as the contract amount increases. We work diligently to find the lowest premiums possible in the state of Nebraska. Please call us today at (913) 225-8501. We'll find you the very best rate possible for your maintenance bond or completion bond. Things that can affect this pricing are the perceived risk of the job, the financial position of the entity being bonded, plus other factors.
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These rates are for Merit clients, Standard rates are higher
How do I get a Bid Bond in Nebraska?
We make it easy to get a contract bid bond. Just click here to get our Nebraska Bid Bond Application. Fill it out and then email it and the Nebraska bid specs/contract documents to [email protected] or fax to 855-433-4192.
You can also call us at 913-225-8501. We thoroughly review each and every application for bid bonds and then submit it to the surety that we believe will provide the best surety bond for your job. We have a high success rate in getting our clients surety bid bonds at the best rates possible.
What is a Nebraska Bid Bond?
A bid bond is a bond that guarantees that you will accept the work if you win the contract. The bid fee (usually five or ten percent) is a penalty that is paid when you win the bid, but then back out of doing the work.
Find a Bid Bond near Me
Typically, a bid bond and payment bond are done together in the same contract by the surety. This way, the owner of the project is assured that the project can be completed pursuant to the terms of the contract and that it will not be liened by any contractor. The bond is performance security for the benefit of the owner.
Who Gets the Bond?
The general contractor is the company that gets the bond. It is for the benefit of the owner (or in the case of government contract work, the governmental entity). It's the general contractor that has to apply for the bond and be underwritten before the performance and payment bond is written by the surety. This is also known as bonding a business.
We provide bid, performance and payment bonds in each of the following counties:
See our Nevada Bid Bond page here.
More on Surety Bid Bonds https://swiftbonds.com/bid-bond/.
Introducing Trouble-Free Advice When Looking At Bid Bonds
You need to know that a Surety Bid Bond is extremely important for anyone, but it is complex if you don't know anything relating to this. This isn't an insurance claim since this is a kind of assurance that the principal will properly complete the task. You need to know that some individuals will certainly require you to obtain a specific bond before they go for your services since it can also be a type of guarantee to them. They actually need this type of thing from you so you should search for an insurance company that will offer this. If you want to search for a license bond, permit bond, commercial bond and more, you have to know what this means.
A Simple Explanation On A Surety Bid Bond
Bid Bonds will likely be required by the public because it can protect them and it may also guarantee that the principal will fulfill their duties. As the principal, you must obtain a license Surety Bid Bond to guarantee that your company will stick to the laws and you need a contract bond to ensure that a public construction project will likely be accomplished. There are examples that will offer an idea on Surety Bid Bond.
This is actually made for the clients since they will be protected by the bond, but it may provide advantages to you as well as they would trust you in case you have this.
How It Works
Bid Bonds could be considered as a three-party agreement between a surety company, the principal and the obliged. The principal is generally known as the employer or company which will perform the work and the obliged is the project owner. If a construction company will work on a public project, they will be required to get Bid Bonds. Once they want to work on the project, the government will require the construction company to secure several bonds.
The work of the bonds is aimed at the sub-contractors and employees to guarantee that they will be paid even if the contractor defaults. The contractor will handle any losses, but as soon as they reached their limit, the duty will fall to the surety company.
Applying For A Surety Bid Bond
Insurance companies typically offer Bid Bonds, but there are some standalone surety companies that concentrate on these products. Surety businesses are frequently licensed by a state Department of Insurance so you have to check it first before deciding. It will not be simple to apply for a bond since the applications will need to proceed through checking before it is approved. The bond underwriters will evaluate the financial history of the candidates, credit profile and other important aspects.
It only means that there's always a chance that you'll not be accepted for a Surety Bid Bond, particularly if your credit history is bad.
The Cost Of A Surety Bid Bond
There's no particular cost for a Surety Bid Bond because it will depend upon several reasons like the bond type, bond amount, where the bond will be issued, contractual risk, the credit history of the applicant and a lot more.
There are lots of bonds right now and the cost will depend on the kind of bond that you can actually obtain. The amount of the bond may also be a factor because you could obtain a $10,000 bond or a $25,000 bond.
In case you have a credit rating of above or near 700, you'll qualify for the standard bonding market and you will only pay a premium that is 1 to 4 percent of the Surety Bid Bond amount. If you will obtain a $10,000, it would cost around $100 to $400.
Is There A Chance Of Being Denied?
There is a chance that the license and permit bond will be denied by the insurance companies and it will depend on the background check that they did. If they think that it will likely be a big risk to give you a Surety Bid Bond, they will obviously deny your application. Credit history may also be a deciding factor because if you actually have a bad credit history, it will likely be hard for you to obtain a Surety Bid Bond because businesses are considering you as a risk. If your credit rating is bad, you may still be approved, but you'll need to pay an interest rate of 10 to 20 percent.
If you genuinely wish to get your Surety Bid Bond, you will need to make sure that you will understand the process so you won't make a mistake. It will not be simple to apply, but if the requirements are met and you are eligible, you will obtain a Surety Bid Bond.