Small Contract Performance and Payment Bonds and
One-Time Bonds under $250,000.00
Starting out doing bonded contract work can be overwhelming because of all the information that is asked of a contractor to initially set up an full bonding account. If you only bid on one job and are awarded a contract, and do not expect more jobs that require bonds in the future, you can use the small contract method instead of the setting up a complete bonding line. This is an easier way for those occasional small jobs.
The methods below are abbreviated paths to obtaining the type bond you need without setting up a full bonding line with the surety company. Even though these methods are less involved, you still have to complete an application, provide job information, and financial information. The underwriting is still driven by credit and assets but in this case, they are mostly interested in your credit. This may be the path or method you need. Please see the descriptions below:
Contract Performance and Payment Bond Under $250,000.00
You can use the small contract method for contract performance and payment bonds under $250,000.00. This process is for contractors who only have one or two jobs every so often, or the jobs are under the $250,000.00 size or approximately that size. The idea is to make the process a bit simpler and faster. This method is mostly credit-based, but assets do play an important part in the approval stage of underwriting.
Please call us at 619-670-1136 to discuss the type of job for which you wish to obtain a bond, and to review your financial strength. This will aid us in determining which surety company has a bond best suited to you needs. We have a number of surety companies that offer small contract bonds, although we are only showing two on this webpage. They both charge a 2% to a 3% rate for the first $100,000.00. Once approved the surety company will advise of the approved rate. This is a short application and will be approved according to the strength of your credit and assets. This method is designed for a one or two time use. If you are doing more than the one or two bonds you need to set up a bonding line, and we can assist you with this.
QuicknEZ Application for Bonds under $250,000.00
The QuicknEZ application is for bonds under $250,000.00. We should talk to you prior to your filling out any forms for these bonds.
If you have been awarded a job through a bid process, then surety will require a copy of the contract and the award letter. Also they will ask for the bid results if the job went through the bid process.
Further there are other programs that we can offer the contractor who needs help -- one of which is the SBA that guarantees a large part of the bonding line. It is yet another level of work, and yes, the government charges for it, along with a different structure for the premium for the surety companies. Premiums can go higher or lower if the risk warrants it. Normally, the first year’s premiums are fully earned.
If the owner or entity that is requiring the bond (Obligee), has the bond form in their contract documents or specifications, we will need that bond form. If they have not included the form, please let us know if a standard bond form can be used for the project. Please call us at 619-670-1136 with any questions. We will be happy to help.
Again, please note this program is based mostly on your good credit and assets. If you have bad or marginal credit, we need to talk to you prior to your filling out any of the forms below.
FORMS:
Status of Contracts / Work in Progress
Personal Financial Statement -- more info.