What is a property bond?

Most of the time, bail is paid in cash, but in certain circumstances, you can use property to bail an individual out of jail instead. Property bonds can be useful if cash isn't available for bail. Since a bail bond agency still charges 10% of the premium payment, individuals who are low on cash may not be able to pay even that amount. In this case, a property bond can be useful. 

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Using a property bond essentially means that the bond is guaranteed by a pledge of unencumbered equity in real estate in the same state. Equity of at least 1.5-2 times the bail amount is generally required. This can be equity in a person's home, commercial building, or even a vacation home, and like a cash bond, it assures the court that the accused person will be present at their court date(s). 

When you use a property bond, the court secures a lien against the property for the amount of the bail; if the individual doesn't appear at their court date(s), the property then passes into the hands of the court. The property may face foreclosure action, and after the foreclosure proceeding, the court collects on the bail amount that is owed. If the foreclosure sale doesn't cover the full cost of the bail that was secured by the property, the court will then seek to recover the difference from the accused.

In some cases, market conditions for selling the property can result in the denial of this type of bond. For example, if the property is located in an area with low demand or low market value, it could make it difficult for the court to sell the property in order to recover the amount of the bond if the individual skips bail.

Property bonds can only be obtained from a court, and they aren't allowed in all jurisdictions, so make sure to check the rules for your jurisdiction.

Obtaining a property bond involves several steps; a bail bond agent can assist you with these, but the process typically requires the following: First, the value of the property must be verified, either through an assessment by a court-appointed appraiser, or through paperwork that confirms the value. This can include mortgage/conveyance certificates, the property's deed, the title history, a list of current lien holders, and/or declarations made on tax documents. Your equity will be determined, and if you have enough to finance the bond, paperwork will be prepared by the court, then presented to the judge to be considered for bail release.

In some cases, more than one person is listed on the warranty deed or tax statement; in these cases, each owner must sign an agreement stating that they authorize the property to be used to finance a bond.

No matter the outcome of the hearing, the lien will be released as long as the individual shows up to all required hearings. When the case is closed, whether the individual is found guilty or innocent, the court will release the lien.

If you need assistance with a property bond, or any type of bond, contact us today for a free consultation.

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