Contracting a construction company to create a new building is something that many people and businesses go through every year. Unfortunately, mistakes in design can add thousands or even millions of dollars to a project. Thankfully, a surety bond can protect you from this danger.
Problems Can Occur On Just About Every Site
Complications on a job site are nothing to most contractors. In fact, most assume that issues will pop up that slow the building process down at least a little bit. However, that doesn't mean that these incidents aren't difficult to manage. For example, a problem with the schematic design of a building could take weeks to diagnose and fix, which can set back construction for weeks.
The individual purchasing this contract work is less likely to be understanding about these issues. After all, it is their money being poured into the project, and it may become a real problem if the contractor can't figure out their schematic issues. As a result, a surety bond is a wise investment in just about every type of construction situation.
Surety Bonds Can Protect You From Unknown Circumstances
Purchasing a surety bond from a financial company can help protect you from these problems. These bonds serve as a guarantee that the contractor will get the job done and help provide a decent amount of money for a job of this type. They can be used in a variety of ways, including as collateral on another type of loan or even a mortgage. As a result, the contractor will be obliged to continue their job, even after making serious design mistakes and being forced to change them.
As a result, a contractor or even a person hiring a contractor benefits from a surety bond because they ensure that everyone is on the same page and prepared to finish the job on time. When taking out one of these bonds, it is important to know the kind of interest rates to anticipate, as this will add a little bit of extra money to your building cost.
Interest Rate Percentages To Expect
Whether you are an individual or a company protecting yourself from building designs, a surety bond can come in many different interest rates. They are usually quite fair, particularly if you have a great credit score. Those with scores in the highest ranges can often get a rate for as little as 1-2 percent annually. However, even those with a poor score can get one for just 10 percent.
These rates will add a relatively-low amount of money to your building costs. They are certainly less costly than a serious building mistake, making them a great way to ensure that your project gets done properly. Talk to a financial company near you like Service Insurance Company to learn more about surety bonds and how they protect your investment.
Share2 March 2018
I still remember the first time I had to chose an insurance policy; I was 17 years old and had just saved up enough money to afford my very first car. I was so excited to begin driving, but overwhelmed with all of the different auto insurance options. My father helped me chose a full-coverage policy that would cover the cost of my car if it were to become damaged in an accident. When I inevitably caused a small fender-bender as a new driver, my insurance company paid for my car repairs, so it sure was the best policy for me! Now that I am older and have learned a lot about home insurance and other types of insurance, I thought I would make a blog to help others who need insurance advice, like what my dad gave me. I hope I can help you make wise insurance decisions!