Release bond to builder questions?

I'm not an expert in this subject, but the core of the issue is the language contained in the RE 643 form, a sample of which can be downloaded here: http://www.dre.ca.gov/pdf_docs/forms/re643.pdf

I don't see anything in the form itself that would give you the option of holding back the bond as leverage for completing or fixing construction issues, but the language seems to state that 80% of the units have to be transferred before release. Do you have an association attorney?

Rob

What is contained in the Public Report he had to file for?

B. Public Report. Subdivider has applied for a California Department of Real Estate Public Report (“Public Report”) covering the Subdivision. Prior to obtaining the Public Report, the Subdivider is required pursuant to the provisions of Section 2792.9 of Chapter 6, Title 10, California Code of Regulations to make and retain in full force and effect arrangements securing Subdivider’s obligations as an owner of separate interests covered by the public report to pay regular and special assessments.

It is my understanding in reading the form Rob posted that the bond is to insure compliance regarding the Public Report he filed with the Department of Real Estate. Are the items not completed contained in said report?

Your local government may have a copy of the Public Report as this is potentially something the developer needed to submit for the subdivision to be approved by the planning department and also the city council.

IMPORTANT: According to the form as noted below you only have 40 days to give written objection, after you have received written notice. If no objection received the money will be given to the developer.

If the Escrow Holder receives a written demand from the Subdivider for the return of the Security, which demand is accompanied by Subdivider’s written statement that (1) the Subdivider has paid as and when due all regular and special assessments which have been levied by the Association against separate interests owned by the Subdivider in the Subdivision, and (2) title to 80% of the separate interests in the Subdivision have been conveyed or leased with terms of one year or more by the Subdivider, then, within fifteen (15) calendar days of receipt of the demand and statement, the Escrow Holder shall deliver a copy of the demand and statement to the Association, or its authorized agent, together with a written notice to the Association that the Association’s written objection to return of the Se¬curity to the Subdivider must be received by the Escrow Holder within forty (40) days after delivery of the demand and statement to the Association.

If interests are covered in the Public Report you may need to potentially assess developer for costs needed to complete. I would recommend checking with an attorney at that time to insure everything is done correct to meet all requirements under the law.