When you bond with HPM, you’ll enjoy a clear and well-defined process while working with experienced staff. We charge no fees for the program and offer electronic form signing for a streamlined process.
Material house bonds allow financially sound lumber and building material suppliers to issue bonds, which give guarantees to the owner and financial institution providing a construction loan. It ensures that the project will be completed in accordance with the construction contract, plans, and specifications. Additionally, all suppliers and subcontractors who provided materials and services for the specific project will be paid.
Frequently Asked Questions
What is a bond?
A bond is a guarantee to the bank and owner that a project will be completed per plans and specifications. It also ensures that all suppliers and subcontractors on the project will be paid through the bond expiration period.
When is a bond required?
Financial institutions in Hawai'i require a bond to make a residential construction loan, securing the bank’s collateral for the construction loan. However, a homeowner funding their own project may request a bond to be furnished by their contractor.
Does HPM bond Owner-Builders?
Some bonding companies and financial institutions will work with owner-builders on a case-by-case basis. HPM will bond owner-builders if they meet our underwriting criteria. Please contact our bonding team for further information.
Are there any fees for material house bonds?
No, material houses are not legally allowed to charge a fee for the service. HPM agrees to bond a project assuming 20-25% of the bond amount in material will be purchased from HPM. HPM believes we are price-competitive and have access to the widest selection of products and the best service package in our market.
A Homeowner’s Guide to Bonding
Determine the type of material and/or finishes you want, and let your planning consultant, draftsperson, or architect know what to include in your plans. This will help your contractor determine the final contract amount, including allowances. If you also put your plans out to bid, you should receive a return of bids that are comparable.