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What is an appeal bond?
An appeal bond, sometimes called a "supersedeas bond," is a legal document issued by a surety company that states if an appellant fails to pay any remaining judgment after an appeal concludes, the surety will pay on their behalf. Effectively, the appeal bond guarantees payment of the judgment if the appeal is unsuccessful.
Appeal bonds are a type of court bond that can be used for judgements in county court, district court, federal court, superior court, or even supreme court proceedings in accordance with each individual court's appellate procedure.
Why do I need an appeal bond?
Appeal bonds are usually required if you're appealing a money judgment and don't want to pay the judgment until the appeal is over. Appeal bonds discourage individuals who lose cases from filing frivolous appeals and prevent abuse of the appellate system. For example, without an appeal bond a party could file an appeal to stall payment of a court-ordered sum. An appeal bond ensures the responsible party will pay the court-mandated sum if the appeal fails.
How much does an appeal bond cost?
Appeal bond costs can vary, but annual surety bond premiums are typically calculated at 1-3% of the bond amount depending on collateral considerations. In addition to the annual premium, applicants must generally post collateral worth 100% of the bond amount with the surety company to qualify for appeal bond approval. When collateral in the full bond amount is posted, the applicant's credit report and financial condition don’t typically affect the bond cost.
How do I get an appeal bond?
You'll need to do the following to get an appeal bond.
1. Check with your lawyer. Ask your lawyer if an appeal bond is necessary, because they are not always required as a part of the appellate procedure.
2. Determine the bond amount. Most states require the bond cover not just the judgment but also costs and interest on the appeal. Your lawyer should be able to determine the exact bond amount needed to fulfill the appellate court's requirements.
3. Contact a surety provider. You can apply for an appeal bond online 24/7 or call 1 (800) 308-4358 to speak with a surety bond expert who will walk you through the appeal bond work process.
How to apply for an appeal bond
Before you can buy an appeal bond, you must submit an application for underwriting. You'll need to provide the following documentation as part of your application:
- a copy of the judgment
- the notice of appeal
- a collateral security agreement
How to buy an appeal bond
Collateral will almost always be required before your appeal bond invoice can be approved. Once the collateral has been secured you'll receive an invoice you can pay online 24/7 to finalize your order.
How fast can I get an appeal bond?
Once your payment has been processed, your appeal surety bond documentation will be issued. You'll receive a digital copy of your surety bond by email, and your physical documentation will be delivered based on your preferred shipping method. If you're in a rush and need your appellate bond as soon as possible, choose overnight shipping when submitting your order.
How do appeal bonds work?
Appeal bonds provide different advantages to the three parties involved.
The Appealing Party: If you provide an appeal bond, the other side can't start collection proceedings against you. This means you don't have to pay up front and try to recover the money from your opponent later on after you win the appeals process. This is called a "stay of execution" upon appeal.
The Judgment Creditor: They can't try to collect while the appeal is pending, but if the appeal isn't successful, they're guaranteed payment by a corporate surety company - typically including interest, and sometimes attorney's fees, too. Appeal bonds can save judgment creditors a lot of time and money during the collection process.
The Courts: Appeal bonds prevent people from filing a frivolous appeal or using the appeal time to "disappear" their assets because it requires them to arrange for a guarantee that the judgment will be paid.
Why do appeal bonds require collateral?
Appeal bonds guarantee the payment of a judgment in the event of a failed appeals process. For better or worse, the fact is that many appeals do not succeed. The surety company must consider what will happen if the appeal is lost. Judgments must be paid quickly, so surety companies must be prepared to pay if the appeal loses, which is where collateral comes into play.
Providing collateral to a surety company upfront offers a number of advantages to the appellant.
1. Avoid collections. You’ll save money, time, and stress by not having to fight collections proceedings while pursuing the appeal.
2. Earn interest. If you provide cash collateral, you’ll earn interest on that cash.
3. Maintain flexibility and control. In addition to cash and letters of credit, some sureties accept collateral in the form of securities accounts or possibly even real estate. You can explore what form of collateral would work best for you and your surety company based on the nature of your pending appeal.
Do I have to provide collateral to get a surety bond for an appeal?
If you have sufficient liquid assets to qualify for a collateral waiver, you can submit a financial statement as a part of your application to see if the surety company agrees. Collateral waivers typically require significant liquid assets such as cash and securities (not property), so you should always be prepared that collateral will ultimately be required.
SuretyBonds.com is legally licensed to issue appeal bonds in every state.