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 Wisconsin
On Wisconsin public improvements, an unpaid subcontractor or supplier can serve notice of a lien on money owed to the prime contractor, and the public body must hold back enough to pay the claim (Wis. Stat. § 779.15). Under Wis. Stat. § 779.17, the prime contractor can get the held funds released by filing a surety bond, approved by the public authority, guaranteeing payment of any judgment for the claimant.
- The lien on funds does not apply in cities of the first class (Milwaukee), per Wis. Stat. § 779.15.
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.