Do I need a bond? What is it exactly?
How do I know what type I need? How do I find an underwriter?
Have you wondered about these questions as you consider how best to protect your business, yourself, your workers and clients?
Listen in to this episode of the Rocket Roof Show to hear Andy’s conversation with Josh Cotner of Contractors Choice Agency to learn answers to these questions and more.
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Josh certainly knows bonds and his enthusiasm to help others comes through in this helpful conversation on a topic that confuses many. He explains the process of finding an underwriter and getting them to be willing to put trust in you. After all, “you’re not landing someone on the moon” as Josh puts it, you’re replacing or repairing a roof.
Josh explains the whole process is generally straightforward if you are a hard worker who finishes each job well. It’s important for the underwriter to hear a bit of history and personal story about each applicant as they measure the risk, because it is essentially the personal choice of the underwriter that gets the bond approved. They want to know they should believe in you and that the job will be completed on time with professionalism.
A bond is basically a three-party contract between the contractor, owner of the project, and the bond company to guarantee the performance of the contract. It helps assure that all license laws are being followed and necessary permits are secured.
Surety bonds are pretty much any type of bond and there are dozens of different types. Some include payment and performance, maintenance and performance, bonds with two layers because it is a job using subcontractors, license bonds, and many more. A performance bond has an additional part for payments because of course suppliers and laborers will need to be paid.
Municipal and governmental jobs require bonding for protection. Even if you are well known and respected, the bond company will want more assurance of your trustworthiness. Larger companies will usually want to know you are bonded as well, because fiduciary money must be paid out quickly in the event something goes wrong.
Personal difficulties like divorce or bankruptcy will not usually prevent large bonds from being approved, but the underwriter may want to understand with more clarity about the applicant’s situation; it would not typically affect approval.
The benefit of using someone like Contractor Choice Agency comes from the good relationships they already have established with bankers and bond companies. Their opinion matters, and Josh cautions, they do check social media!
Bond paperwork can usually be handled quickly. Covid-19 has changed that in recent days, but Josh is clear that credit markets are fully functioning and not closed or ceased up by any means.
A thirty-day notice in advance allows Josh time to look over your credit report. With this preliminary step completed, he can let you know what your rate would be and have you pre-approved ahead of time.
There are things you can do to prepare that help secure the guaranty of a bond such as paying down debt, paying off credit cards, and even paying off an old library fine.
Josh also offers help with credit counseling and credit repair if needed.
Certainly, a great credit score can help solidify the process and garner the bond, but if your history is not known and the trust isn’t built yet, the rate of the loan might be higher. Contractor Choice Agency has the built-in trust to help represent you.
There are many outside the box solutions to be found when bonding and Josh Cotner is happy to discuss them to help you meet your needs.
You can reach Josh at 844-WORK247 or 844-967-5247 if you would like to learn more about this topic and the ways he can help.
SPONSOR APPRECIATION
Special thanks to our sponsor Top Roof Marketing, a full-service marketing group that specializes in the commercial roofing industry.
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