SURETY
FOR
REAL ESTATE

Real estate development projects often have mandated bonding requirements when a municipality is the project owner or may require certain improvements be made when it comes to site work on private projects. These are guaranteed through
Site Improvement Bonds

Similarly, Utility Payment Bonds ensure payment is made to the utility company for multi unit holdings.

Of great interest and economic benefit to projects owners are Escrow Release Bonds described below.

ESCROW
RELEASE
BONDS

A surety bond written to guarantee the obligation of a developer to refund security deposits to buyers if a project is cancelled.

Escrow release bonds can be used as a financing tool for developers enabling the liquidation of security deposits, to be used in lieu of higher cost construction financing.

See how adding bonds can reduce financing costs using our
INTEREST EXPENSE SAVINGS CALCULATOR

How it works…

01
As a condo development project enters the construction phase, unit pre-sales begin. Project sponsor undergoes underwriting process with the Surety that will provide bonds.
02
Agreements include default language that secure deposit funds with an escrow release bond, backed by an A-rated insurance company, providing added protection for the buyer against sponsor default.
03
Surety provides bond to the individual buyer, which triggers an automatic release of project funds to the sponsor.
04
Escrow attorney accelerates deposit funds to the sponsor to be used in lieu of construction financing.
05
Borrowing costs are reduced by substituting a portion of the construction loan with 2% bonds (on average) versus the equivalent amount at 5-7%. It’s that simple.
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CONTACT
RAFFUEL
SURETY
GROUP

OUR ADDRESS

15 Chambers Street
Princeton, NJ 08542

Email: info@raffuelsurety.com
Tel: +1(609) 924-2426

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We can help.

It all starts with our Mission Statement. Understanding your business and your needs. But it goes deeper. We bring balance and insight to the situation. Our experience puts us in a unique consultative role. That alone is valuable, but without the right markets it’s a tree falling in the forest kind of thing. We represent the broadest possible array of surety companies in the business with worldwide capabilities, both traditional and innovative. There isn’t an answer for everything, but if it exists, we’ll find it.

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