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subdivision/site improlvement bond is for mandatory public improvements that builders, developers, and individual landowners make to their property. The local authorities require a guarantee that the landowner completes the improvements. A
subdivision bond obligates the principal and the surety to complete
subdivision improvements.
A
Performance Bond guarantees the faithful
performance of the contract and payment of materials and labor by the
contractor to all subcontractors and material suppliers. Generally a
performance bond is required by municipalities who are hiring
contractors to do work for them. The bond is submitted by the winning bidder upon award of the contract. The
Performance & Payment Bond are typically issued together, as they are so closely related.
For more information about
contract bonds, please visit the following site:
Surety Bond Types: Contract Bonds