Bid bonds are something consumers do not hear a lot about. That is unfortunate since a bid bond is ideal for whatever project you want to start and finish and for which you need to hire a contractor. Here are three reasons why you should want to hire a contractor with a bid bond the next time you have a big remodeling project that you want to complete by a certain date.
You Lose Zero Money
If you could hire a contractor and lose no money on the job at all, you would, right? That is exactly what a bid bond does. The contractor is saying that he/she is going to do everything you request and require by a given date, or you get your money back. It is essentially a "money back guarantee" of sorts on your project. The contractor charges you the cost of the bid bond, so it is akin to buying insurance, too. However, the cost of the bid bond is truly minimal in the event that you invest thousands, and the project does not go as planned.
The Contractor Is Legally Liable
A bid bond holds the contractor liable. If you did not have a bid bond with the contractor you hire, and the job was a nightmare, you could sue, but it is not likely you would get most of your money back. With the bid bond and the contractor that carries it, you do not have to sue, you do not have to go to court, and you get most of your money back. Imagine the financial gains; no lawyer fees, no legal fees, and no return of monies owed.
The Contractor Is Financially Stable and Is Not Going to Rely on Advanced Payments
A really good contractor is financially stable and does not ask for advance payments on a job. He or she can pay for the materials needed and wait for final payment from you. A bid bond assures you that no money will be required up front because the contractor can manage the project materials and employee payroll without getting advance payments from you. That alleviates a lot of stress and concern on your part. Then you know that you have time to accumulate the amount needed to pay for the project when it is complete. (Although it helps to secure all of the money for your project ahead of time.)