Surety Bonds
What Is a Performance Bond for Contractors?
A performance bond guarantees that you’ll complete a project according to the contract terms. If you default, the surety steps in to ensure the project is finished.
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What is a performance bond and when do I need one?
A performance bond is required on virtually all public construction projects (federal law mandates them on contracts over $150,000) and many large private contracts. The bond amount equals the full contract value.
If you abandon a project, become insolvent, or are terminated for cause, the surety fulfills your obligation — either by financing you to complete, hiring a replacement contractor, or paying the owner’s completion costs up to the bond amount.
Performance bond cost: typically 0.5–3% of contract value for well-qualified contractors. A $500,000 project: $2,500–$15,000 in bond premium. Rate depends on your credit, financial strength, and experience.
Need a surety bond fast?
Trade Safe helps contractors get bonded same-day in most cases. We work with multiple surety markets to find the best rate for your situation.