what is a bond to release a lien?
A Release of Lien Bond is required to discharge liens against property. A lien may be filed by a third party such as a supplier or subcontractor who is involved in a construction project. Thus, the bond may be required of the general contractor obligated to pay these parties. Ownership of real estate cannot be transferred unless the property is free of liens or a Release of Lien Bond has been filed. The bond protects the party who filed the lien against the property and guarantees payment will be made to this party. It is important to note that Release of Lien Bonds always require that collateral be posted in advance in the amount equal to 100% of the bond obligation. The collateral must be in the form of cash, or cash equivalent and is in addition to the premium charged for the bond.