loans maryland: Individual Surety Bonds

2008-05-02 10:45:09

( Financial )



Are you interested in loans maryland, mortgages maryland? For loans in md there is a new loan, which allows you, the contractor, the use of individual surety bonds.

For minority contractors in maryland what is one of the biggest problems facing you? The answer? Submitting individual surety bonds for work done for the state.

Here’s the scenario. You are an architectural ??? work specialist who has done woodworking on a high profile building. In fact, you have done high profile work all over the state – as a subcontractor. But you had a bad year and since then you have had problems getting a surety bond which you needed for big projects.

Even if you post millions of revenue a year you might still only get a state program to bond you.

But now there is a new bill, which permits you to submit individual bonds for work done for the state with loans maryland. This could go a far way to help small contractors get the loans maryland they need to get state projects. Opponents, on the other hand, say it could be bad news for construction suppliers and small subcontractors.

What is a surety bond? It guarantees that you the contractor complete a project, paying suppliers and subcontractors. Any state project which costs more than $100 000 needs a bond. Some smaller projects do as well. Previously maryland would only accept bonds, which had been issued by an insurance company.

So this bill really represented a monopoly breakup – the monopoly of corporate sureties.

What is an individual surety?
It must have assets enough to back the complete amount of the bond they issue. As a contractor to qualify for this type of surety, you need to have been refused for a corporate surety.

People who support the bill say that corporate sureties have been tightened by underwriting because of some leaving the business – this makes it more difficult for the small contractor to qualify. Industry associations opposing the bill said insurers have enough resources and could issue sureties to businesses that qualified.


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