A surety bond can be defined as is a sole promise by some guarantor to pay a particular amount of money to one party. The money is paid only when a second party (mainly the principal) fails to meet the terms of the contract. Seems a bit complicated, but it is not at all a complicated task to acquire a surety bond. If you want to have a surety bond in Georgia, then you don’t need to worry at all.
To have a surety bond in Georgia, there are some certain facts and terminologies youneed to know. This type of bond justifies the benefit of the obligator. You need to submit a sum of money for security due to the risks involved in giving the bond. Such bonds are verified through regulations of the government and private audits, and sometimes, both.
Though these bonds can occur in different cases also, like fiduciary performances in public and private, etc. But if you are looking for some deeper information and subdivisions of the surety bonds in Georgia, then I have got the following classifications for you:
Contract Surety Bonds
In this type of surety bond, a two-party performance is guaranteed through a written agreement. For example, payment, bid, performance, and maintenance bonds.
- Payment Bonds – Assures the proper payment of mentioned laborers and sub-contractors by the contractor.
- Bid Bonds – Assures that the contractor follows the contract and gives the performance along with the payment bonds. This bond mainly assures whether the submission of bid is in good faith or not.
- Performance Bonds – In the case of failure in the performance of the contractor, the owner can have a huge financial loss. This bond prevents the owner from such losses.
- Maintenance Bonds – In the case of any defect in materials or even the defect in work, this bond is used to guarantee the protection against such circumstances.
International Surety Bonds
The performance of domestic as well as foreign companies includes a warranty, advance payments commercial, contract, and maintenance bonds. In this type of surety bond, the performance of such companies is guaranteed.
Commercial Surety Bonds
This special type of bond is an outcome of several types of bonds which ultimately guarantee financial performance. Commercial surety bonds are classified into many types of bonds such as public official, license, judicial, and other miscellaneous bonds.
- Public Official Bonds – The dutyof public officials, which you see every day, is guaranteed by this bond. Such public officials include judges, sheriffs, notaries, tax collectors, etc.
- License and Permit Bonds – If you want to take part in a specific business, then you need a license for that. To obtain a license from local regulators, these bonds are required.
- Judicial Bonds – As discussed earlier, the fiduciary performances, such as administrators, liquidators, legal guardians, etc., these bonds specifically secure their performances.
- Miscellaneous Bonds – These bonds guarantee several other performances such as utility bill payments, lost securities, etc.
There are two other types of Commercial Surety Bonds namely, Federal Non-Contract Bonds (required by the federal government) and Subdivision Bonds (guarantees the finance for constructional improvements of a place).