What a stop payment notice release bond is
In a few states, an unpaid subcontractor or supplier can serve a stop payment notice (also called a stop notice) on the owner or construction lender, which then holds back money owed on the job. A release bond lets that money be paid out; the claimant then claims against the bond instead.
In Oregon
Oregon's construction lien law (ORS 87.001 to 87.093) has no stop payment notice procedure, so this bond is not used. Instead, an owner or interested person can release a construction lien with a bond or deposit of at least 150% of the claim or $1,000, whichever is greater, under ORS 87.076.
You need this bond if you're
- A general contractor whose payments are being held
- A property owner or public agency holding funds
- A construction lender holding loan funds
What the surety looks at
The claim, the dispute behind it and your finances.