Surety credit facilities provide developers with the option to lower their cost of capital by allowing access to buyer’s first 10% deposits on residential condominium projects. When compared to other sources of capital, the cost of the Florida Escrow Deposit Bond is significantly less. WTW provides fast, competitive bonding solutions tailored to meet the specific needs for each individual project’s financing strategy. Our Escrow Surety Team leverages long-standing relationships to place bonds providing low-cost construction capital. WTW has syndicated and placed bonds for many of the largest developers in the United States, supporting bond syndications ranging from $5 million to $500 million in support of escrow deposits.
Florida Statute 718.202 – Sales or reservation deposits prior to closing - allows for the initial 10 percent deposits for a residential condominium to be released by securing these deposits with a surety bond in an equivalent amount.
WTW can also assist with bonding the deposits from out-of-state buyers (i.e. NY, NJ, etc.) allowing even more access to lower costs of capital.
Underwriting considerations
Every project is different; the following underwriting items will determine pricing, program capacity, and timing of bond issuance:
- Sales
- Construction Loan Status
- Sources & Uses
- Equity Contribution
- Loan to Value
- Cost of Work
- Scope of Work
- General Contractor
- Developer Experience
What does WTW do?
Our Escrow Deposit Surety Bond practice provides developers an opportunity to pursue efficient cost savings and capital allocation. Our practice group will work to obtain the most favorable terms and conditions available in the market to allow increased liquidity and less dependency on traditional project-secured financing. These programs are heavily dependent on a few items that are integral to the surety program and allow for continued improvement and growth. WTW specializes in the following considerations when consulting with our clients:
