Overview of Bonding Requirements in Charlotte
If you are new to the concept of surety bonds, you can learn all the basics on our “What is a Surety Bond?” page.
Surety bonds are an agreement between three parties: a principal, an obligee and a surety. The principal is the business or individual which is required to get bonded. The obligee is the state or city’s government body which mandates that you post the bond. The surety is a bonding company which backs the agreement.
The surety assumes legal responsibility for the actions of the principal, so if the principal fails to adhere to the bond’s terms, they must step in and provide financial compensation.
Both businesses and individuals might be required to get bonded in Charlotte, depending on their field and other factors. Here are the basic categories of bonds.
License & permit bonds
These are the types of bonds businesses must obtain when they apply for a license, registration, or some types of permits. These bonds guarantee that the bonded business will operate in compliance with all city, state and federal regulations that apply to it. In most cases, license bonds provide a quick recourse in case a business’s client suffers financial loss or other damages.
A contracting business looking to secure a construction contract with the city of Charlotte or with the state of North Carolina, might be required to post a contract bond. Contract bonds, such as payment and performance bonds, ensure that the contract is completed on time and in accordance with other conditions set out in the contract. They also ensure that subcontractors, suppliers and laborers and paid for their services.
You might need a court bond if you want to appeal a court decision and delay the payment of a judgment, for example. In that case, the court bond guarantees that you will have paid for the judgment if you end up losing the case.
Questions about Surety Bonds in Charlotte, North Carolina
What’s the Cost of Getting Bonded in Charlotte, NC?
The cost of getting bonded depends on the type of bond you require, your personal credit score (and that of all business owners), and other details of your business, such as your experience and financial strength.
For license bonds, the amount is usually between 1% and 4% for applicants with good credit, or from 5% to more than 10% for those with a lower score.
It’s harder to provide an estimate for contract bonds, as this will depend on the type of project you will be bidding on.
You can learn more on the topic on our “What Does a Surety Bond Cost?” page.
How can I get bonded in Charlotte?
The application process also depends on the type of bond you need.
License bond application
To apply for a license bond, all you have to do is submit our online application. This is the fastest and easiest way to get the bond you need. We will contact you shortly and give you a no-obligations quote.
License bonds typically take between one and two business days to underwrite.
Contract bond application
To apply for a contract bond, you should follow the instructions on our contract bonds application page.
You will be required to submit the relevant bond request form, along with a credit release form and personal and business financial statements (balance sheet and income statement).
Still have questions about getting bonded in Charlotte? Call us at (877) 514-5146 and we’ll be happy to help!