For contractors and other business professionals needing NJ surety bonds, they can open up a lot of opportunities that would not be available without securing a bond. Clients like to feel protected when entering into business contracts with companies, and since the nature of surety bonds is to protect people from fraudulent and unethical businesses, bonded companies reassure people that they’re making the right choice.
The list of people and businesses that are required to be licensed and bonded in the state of New Jersey includes plumbers, electricians, HVAC contractors, public adjusters and public officials, to name a few. This is required if they plan on working on residential homes. The goal of these bonds are to protect the public by ensuring each principle will conduct business professionally, abide by local ordinances and hold the state and county government entities harmless in the event they cannot fulfill their obligations.
Performance, bid, and payment bonds are essential bonds
Bid Bonds – This is where the process begins; bid bonds are needed during the project bidding process. Most public and many private construction projects require all contractors guarantee their work and will honor their bid or proposal.
Performance Bonds – This is the next step in the contract awarding process and basically guarantees the owner that the contractor (or sub contractors) on the project will complete the project according to the agreed terms. If either party defaults, the third party or surety will see the agreement through to an acceptable resolution.
Payment Bonds – Finally, with a payment bond, the owner of the contract guarantees that subcontractors and suppliers will all be paid the monies agreed upon in the contract, even in the event that the principle fails to pay those same subcontractors and suppliers directly.
An array of surety bonds is available in New Jersey
There are many different types of businesses in the state required to secure a NJ surety bond. Check local and state rules and regulations regarding bonding to see what kinds are necessary. Even if a business doesn’t have to be bonded, it is an important consideration as it provides an extra layer of protection. It also helps to be bonded because customers will feel more confident about doing business with a bonded individual or company.