New York Performance Bond Guide
Performance bonds are common on New York public works and many private construction contracts. This short, scannable guide explains what a performance bond does, who typically needs one, how cost is set, what underwriters review, a simple checklist you can act on, and filing tips to avoid rejections.
NY performance bond
A NY performance bond guarantees the contractor (principal) will complete the work according to contract terms and specifications. It protects the project owner (obligee) from extra costs if the contractor defaults or fails to perform.
New York bond cost
Premiums vary with bond amount, contractor credit, company financials, experience, and claims history. Strong credit and clear financials generally yield lower rates; weak credit can require higher premiums or collateral.
Performance bond cost
For most contractors, expect market premiums from roughly 0.5% to 3% for qualified work on standard projects. Large contracts, complicated scopes, or poor credit push rates higher and extend underwriting time.
NY bond underwriting
Underwriters review tax returns, balance sheets, backlog, work history, references, and key personnel. For significant bonds they often request compiled or audited financials and a detailed work‑in‑progress schedule.
NY bond application
Complete the application with exact contract details: obligee name, contract amount, scope, start and completion dates, and delivery instructions. Attach 3–12 months of bank statements, the latest tax return, and signed credit authorizations for principals.
Performance bond filing
Deliver the signed bond exactly as the contract requires—sometimes recorded with the county clerk, sometimes delivered to the owner. The most common rejections are incorrect forms, misnamed obligees, and missing signatures.
NY payment bond
Many New York public projects require payment bonds in addition to performance bonds to protect subcontractors and suppliers. Payment bonds on public work often equal 100% of the contract amount.
Performance bond checklist
Confirm the exact obligee name and required bond form in the solicitation or contract packet.
Gather business formation docs, EIN, contractor license, and local registrations.
Prepare 3–12 months of bank statements and the most recent tax return.
Compile backlog, key references, and a list of key personnel.
Sign credit authorizations for principals and request a preliminary broker quote.
Performance bond alternatives
If traditional surety underwriting is constrained by credit, options include posting collateral, partial collateral arrangements, parent company guarantees, or third‑party guarantees. Discuss alternatives early with a surety broker.
Practical tips for contractors
Confirm obligee wording before ordering the bond.
Start bonding discussions as soon as you have a notice of award.
Keep a rolling prequalification packet to speed approvals.
Order larger bonds several business days before deadlines.
Action: obtain the exact bond form from the contract, assemble the checklist documents, contact a New York surety broker, and authorize credit checks so underwriting can proceed immediately.