As the population in the United States continues to grow, land and property issues are increasingly becoming a common occurrence.
Whether it is highway construction or something more, there are many reasons why government agencies will exercise the right of Eminent Domain to secure the property.
If that private property is taken for public use by the government, Condemnation Bonds are put in place to protect landowners and guarantee repayment for any damages that may occur during the process.
If you have found yourself in a situation where you have been asked to release your land, here is everything you need to know when it comes to the benefits and securities of a Condemnation Bond.
Condemnation Bonds: How They Benefit and Protect The Public
The U.S. Constitution grants the government the right to secure private land for the benefit of the public.
According to these laws, the government only needs to guarantee “compensation” to the landowner after that person has released the property.
Government agencies will usually hire a private company in these instances to secure land from the private owner. When the hired company and the landowner can not agree on the terms of what exactly the “compensation” should be, the hired company can post a Condemnation Bond which guarantees that the landowner will be compensated entirely for whatever the court finds acceptable.
Condemnation Bonds usually help to alleviate any delayed time that is being allocated to a project for which the land is needed. Therefore, the hired agency, which is being tasked with successfully securing land from a private owner, is the responsible party for securing a Condemnation Bond.
Once a court officially rules on what should rightfully be allocated to the land’s original owner, the hired agency will be responsible for fully paying off the allocated debt to the landowners.
How Much Do Condemnation Bonds Cost?
Just as any other type of bond, Condemnation Bonds will vary in price from state to state.
The premium for these bonds will depend on the type of property being seized, as well as the financial status of the applicant, including credit scores.
In most instances, the bond penalty is based on the difference between the offered price and that of the original owner.
Condemnation Bonds: A Closer Look
The city of Calabasas in Los Angeles Co., California has been growing exponentially every year.
To meet the demand of the growing population, a new highway was recently approved, which unfortunately traveled through the hillside ranch of Mr. Chavez.
Stature Glen Inc. was hired by the government to secure the land from Mr. Chavez. A compensation price couldn’t be reached. Due to time restrictions, Stature Glen Inc. secured a Condemnation Bond so it could proceed with the highway project as planned.
During the construction process, Mr. Chavez went to court and received a ruling for the land in question, resulting in considerably more than what was originally asked for on his behalf.
Stature Glen Inc. quickly compensated Mr. Chavez for the amount that was agreed upon in court, and the project was completed without any further disruptions.
With a combined 25 years of experience in the insurance and bonding industries, Surety Bond Authority offers a quick turnaround on the bonds you need.
From court bonds to construction bonds, the experienced team at Surety Bond Authority will ensure you get the proper bonding coverage you need in the least amount of time.
Contact us today for any and all of your bonding needs: 800.333.7800.