An administration bond is obtained by an appointed administrator from a surety company. The surety runs background and credit checks on the applicant before approving the bond which is presented to the court.
A contract bond is a legal guarantee that the terms of a contract will be fulfilled. They're also known as construction bonds, as they're typically used for building and renovation projects.
A performance bond is issued to one party of a contract as a guarantee against the failure of the other party to meet the obligations of the contract. A performance bond is usually issued by a bank or an insurance company. Performance bonds can also be used in commodity trades as a guarantee of delivery.
What Is a Term Bond? Term bonds are notes issued by companies to the public or investors with scheduled maturity dates. The term of the bond is the amount of time between bond issuance and bond maturity. On the maturity date of a term bond, the bond's face value, the principal amount, must be repaid to the bondholder.