As much as you trust an individual or an institution, you should never allow yourself to be vulnerable by being left unprotected. A Surety Bond is a form of a guarantee which is a three-party agreement between the obligee, the principal and the Surety. The obligee is the party to whom the bond is given, and is protected by the bond against loss. The principal is the individual who is required to be bonded by the obligee. Lastly, the Surety is the person or institution that guarantees the acts of another person or institution.
Surety Bonds vary greatly in cost, and range from half of one percent to two percent of the contract amount. The cost of the bond depends on the size, type, credit and duration of the project. There are some bonds that are inclusive of others such as a Performance Bond which can include a Payment Bond as well as Maintenance Bonds. These bond prices are usually based on the value of the contract that is bonded, and not on the bond.
Even those who have poor credit can be bonded with a bad credit surety bond. A Mortgage Bond is just one type of Commercial Bonds which is required by the state to apply and operate as a mortgage broker.
