How to Better Your Chances of Qualifying for a Construction Surety Bond
Understanding what documentation you need to apply for a construction surety bond is a critical step toward a business becoming bonded. However, this is not the first and most essential step in the process all of the documentation will not mean much if your company does not have the right experience and attributes to document. In the first place, be sure that your financial house is in order. You have to provide enough collateral and to prove that you have the right funds control.
An applicant who is well-qualified for construction surety bonds will also have a financial statement which is sound with debt levels which are low. The debt levels should be proportional to their market. The company should also have cash reserves. Keep in mind that a credit check will be done. Thus, it is important to clear any credit and debt issues which could come up on your credit report.
Depending on the size of the project, you will have to provide one of three kinds of financial reports. You must have a compilation prepared by your accountant for projects which are below $1 million, a statement which is reviewed by your CPA for projects which are more than one million or a full audit which has been done by an accountant for huge projects.
Another thing you need to apply for construction surety bonds is a strong list of references. The list must include more than your previous customers. Suppliers and other members of the industry can highlight the attributes of your business which are crucial to bonding agencies www.pomsassoc.com
During the process, be sure to work with a surety professional who can explain all that you need and assist you in ensuring that you put your best foot forward as you undertake the application process.
Getting all your stuff in order beforehand has an extra benefit beyond enhancing your chances of getting a construction surety bond. Good collateral, a strong financial statement and the right references can also play a significant role in getting the bonds which you require at the best rate available. This is an additional step in the right direction for your business' bottom line.
You can learn more about construction surety bonds by contacting a professional who specializes in all types of surety bonds for all industries like Poms & Associates
. They will provide you with all the help you need to improve your chance of qualifying for such a bond.
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