performance bonds & labor material payment bond

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    Yu Jen Su

    Answering this one myself. The “limit” of these bonds are 100% of the contract sum. Usually owners will require 100% in both in case GC defaults and Sub Contractors are not paid or are left with a bunch of defective work.

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    Dennis Brunner

    What happens in the case that the actual project cost exceeds the bond amount? For example, if the contractor underbid and can't complete so they go bankrupt.

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