What is a Performance Bond in Maine?
How much does a Performance Bond Cost in Maine?
The cost of a performance bond can vary widely depending on the amount of coverage that is required. It is based on the total amount of the contract. Things that can affect this pricing are the perceived risk of the job, the financial position of the entity being bonded, plus other factors.
How much do bonds cost in ME?
Bond prices fluctuate based on the job size. 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 Maine. Please call us today at (913) 562-6992. We’ll find you the very best rate possible for your maintenance bond or completion bond.
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These rates are for Merit clients, Standard rates are higher
How do I get a Performance and Payment Bond in Maine?
We make it easy to get a contract performance bond. Just click here to get our Maine Performance Application. Fill it out and then email it and the Maine contract documents to [email protected] or fax to 855-433-4192.
You can also call us at (913) 562-6992. We thoroughly review each and every application for commercial bonds and then submit it to the surety that we believe will provide the best p & p bond for your matter. The surety broker will perform a credit check. We have a high success rate in getting our clients performance and payment bonds at the best rates possible.
Find a Performance Bond near Me
What is a Payment Bond? Is it included with the Performance Bond? A payment bond is a bond that assures that the subcontractors and material vendors are paid. The payment provides that if the subcontractors are not paid timely and they make a valid claim, then the surety will pay them (and then collect and try from the general contractor).
What is a payment and performance bond? What is a contract bond?
Typically, a payment and performance 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 entity 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.
How to Get a Performance Bond in ME
Just call us. We’ll work with you to get the best Maine bond possible.
We provide performance and payment bonds in each of the following counties:
See our Maryland Performance Bond page here.
Crucial Requirements To Search For payment bonds
You should know that a payment bond is extremely important for anybody, but it is complicated if you do not know anything relating to this. This isn’t an insurance claim as this is a kind of guarantee that the principal will properly complete the task. You need to know that some folks will certainly require you to obtain a specific bond before they go for your services since it can also be a form of guarantee to them. They require this kind of thing from you so you should look for an insurance company which will offer this to you. If you actually want to think about a license bond, permit bond, commercial bond and more, you have to know what it means.
A Simple Explanation On A payment bond
payment bonds will actually be asked for by the public since it could secure them and it’ll guarantee that the principal would fulfill their duties. As the principal, you must get a license payment bond to guarantee that your company will abide by the laws and you need a contract bond to make sure that a public construction project will likely be accomplished. These are some examples that would give you an idea about a payment bond.
This is actually made for the consumers because they’re protected by the bond, but it will benefit you as well since they will trust you if you have a payment bond.
How It Works
payment bonds are considered as a three-party agreement between a surety company, the obliged and the principal. The principal is referred to as the employer or company which will carry out the work and the obliged is the project owner. Construction businesses will always be needed to purchase payment bonds as soon as they will work on a public project. The government will likely be requiring a construction company to secure a number of bonds if they want to continue with the project.
The work of the bonds is aimed at the sub-contractors and employees to guarantee that they will be paid even when the contractor defaults. The contractor will cover the losses, but when they reached their limit, the duty will actually fall to the surety company.
How Do You Apply For A payment bond?
payment bonds are generally provided by insurance companies, but you could seek out some standalone surety businesses that focus on these unique products. Surety businesses are licensed by a state Department of Insurance.
Applying for a bond is not as simple as you imagine because the applicants will experience a process much like a loan approval. The bond underwriters will certainly check the credit profile of the applicant, their financial history and other key factors.
It will mean that there is a chance that you won’t be accepted for a payment bond, specially if the bond underwriters saw something negative.
How Much Are You Going To Spend For This?
There’s no fixed when you are thinking about a payment bond because it can still depend upon various reasons like the bond type, bond amount, where the bond will probably be issued, contractual risk, credit rating of the applicant and more. There are thousands of bonds currently available and the cost would depend on the type that you plan to acquire. The amount of bond is not really an issue because you can obtain a $10,000 bond or a $25,000 bond. If your credit score is above or near 700, you will certainly qualify for the standard bonding market and you only have to pay about 1 to 4 percent of the payment bond amount. If you will obtain a $10,000 bond, it will only cost $100 to $400.
Is There A Chance Of Being Denied?
There’s a chance that the license and permit bond will probably be denied by the insurance organizations and it would depend upon the background check that they did. If they actually believe that you are a big risk to them, they will deny your application. Credit history will probably be a deciding factor as well because if you will have a bad credit history, it will likely be difficult to obtain a payment bond because organizations will think of you as a risk. If your credit rating is bad, you can still be approved, but you’ll need to pay an interest rate of 10 to 20 percent.
If you wish to get your payment bond, you have to be sure that you understand the process so you will not make a mistake. It will not be simple to apply, but if the requirements are met and you are eligible, you will get a payment bond.
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