A bid bond is a guarantee that a contractor will enter into a contract at the bid price if awarded. It protects the project owner if the low bidder fails to execute the contract.
A performance bond guarantees that the contractor will complete the project according to the contract terms. If the contractor defaults, the bond provides recourse to the project owner.
A payment bond protects subcontractors, laborers, and suppliers by guaranteeing they will be paid for work performed or materials supplied under the contract.
Corporate sureties are evaluated under FAR 28.202 and Treasury Circular 570. Individual sureties are evaluated under FAR 28.203, including pledged eligible assets and SF 28.
Typical documents include the application, bid package, contract, bond form, scope of work, financial statements, work-in-progress schedule, and contractor references.
SF 24 (Bid Bond), SF 25 (Performance Bond), SF 25A (Payment Bond), SF 25B (Continuation Sheet), and SF 28 (Affidavit of Individual Surety) are the primary federal bond forms.
A guide for contracting officers on distinguishing corporate surety from individual surety, reviewing SF 28, and evaluating pledged assets under FAR 28.203.
Key items for individual surety submissions: SF 28, pledged asset documentation, net adjusted value calculation, Treasury eligibility review, and security interest documentation.
AIA bond forms are copyrighted and must be obtained through authorized AIA document sources. FSA can collect information needed to complete a licensed AIA bond form workflow.
Federal bond submissions typically use GSA standard forms. Each form must be completed according to the solicitation, FAR requirements, and contracting officer instructions.
The following documents are typically requested during the underwriting review process. Specific requirements vary by project, bond type, and obligee.
Completed application
Bid package or solicitation
Contract or draft contract
Required bond form
Scope of work
Project schedule
Financial statements
Work-in-progress schedule
Prior project references
Evidence of experience
Collateral or asset documentation, if applicable
SF 28, if individual surety is involved