What is bonding?
Bonding is where a principal obtains an extension of surety credit. In most cases when you refer to bonding you are referring to a contractor that has obtained bonding for their business like a bond line.

What is a Bond Line
A bond line is where the contractor has a line of surety credit to be used for future construction projects. Underwriting for performance bonds can be a long process but if you a bond line you do not have to reapply for every bond or bid bond you need.  When you have established a bonding relationship with the surety the surety normally requests updated financials every quarter.

What is a Bid Bond
In order to obtain a bid bond you must first qualify for what the final bond will be. There is some confusion about bid bonds.  You must qualify for the total contract amount not just what the bid bond will be. So if you need a $10,000 bid bond the surety is not underwriting off of that amount, but what the final bond will be. Usually a bid bond is an percentage of the total contract amount so if your bid bond is $10,000 and it is   5% of the total contract amount the final bond needed would be $200,000. So the surety will underwrite your application off of the final contract amount

What is a Final Bond
A final bond is also called a payment and performance bond. A final bond is when you have been awarded a bid. The bid bond than turns into the final bond you must sign the final bond reflecting the full contract amount and turn the bond into the obligee.

What is a Contractor license bond
A contractor license bond is a state requirement giving you the legal ability to perform constructions jobs in the state your business is operating in.  Obtaining a contractor license bond is usually the last step for the state to grant you your license.