What Is A Grading Bond?

A grading bond is a type of permit commercial surety bond that is generally required when a property owner, developer or contractor is seeking to obtain a grading and/or general building permit where the amount of earth being moved exceeds a threshold set by the city requesting the bond.  This type of bond provides a financial guarantee to the entity requesting the bond that all grading work will be done according to approved grading plans, applicable laws and in compliance with all terms specified in the permit.  A unique feature of grading bonds is that they are generally required on the city and county level as opposed to the state and as such, each will vary in risk depending on the terms being requested for the bond by the city.

To obtain a quote, applicants should obtain a bond request form that outlines the work being performed, the grading permit and/or application, as well as the grading bond form which is often unique to the city or county requesting the bond.  These documents can be submitted to us before or after requesting a grading bond quote.

How Much Do Grading Bonds Cost?

The cost of a grading permit will depend on several factors including but not limited to the terms required of the city requesting the bond, the bond amount and the credit/financials of the applicant.  Depending on the combination of these variables, approved rates can be as low as 2%-5% for qualified applicants with solid credit, to over 10% for those with challenged credit.  The best way to get an idea of the cost is to submit an application for a price indication.