Understanding the ins and outs of subcontractor surety bonds

Description

Abstract: It’s dangerous for any subcontractor to assume that he or she is protected by performance or payment bonds. Such bonds are generally required on public projects, under the federal Miller Act or one of the many state-level “Little Miller” acts. But subcontractors still must perform the due diligence needed to confirm that required bonds exist, that they’re valid and sufficient, and that the surety in question is financially stable. This article explains how bonds are different from mechanics’ liens and what to do to ensure adequate payment or performance bonds are in place.