Surety Bond News

Time-share developers must abide by a new law in Connecticut state titled SB 897. The new law regulates time-shares, requiring developers to put in an escrow and or trust account all advance deposits received from a potential purchaser of a time-share. In the place of an escrow account, SB 897 authorizes the Commissioner of Consumer Protection to allow a surety bond, irrevocable letter of credit, or other assurance. Should the construction of the time-share be complete, the surety bond must be in an amount equivalent to or larger than the amount of funds that would otherwise be deposited. If the project is incomplete, the surety bond may be in the quantity explained earlier or in a quantity that secures the completion of all guaranteed accommodations along with all furniture, fixtures and any other promised modifications. SB 897 became active on January 1, 2010.

Timeshare developers in Connecticut must abide by a new law titled SB 897. The new law regulates timeshares in Connecticut, asking developers to put all advance deposits collected from a potential buyer of a timeshare in an escrow or trust account. In place of an escrow account, SB 897 permits the Commissioner of Consumer Protection to allow a surety bond, irrevocable letter of credit, or other assurance. If the construction is complete on the timeshare, the surety bond has to be in a quantity equivalent or greater than the quantity of funds that would otherwise be deposited. The surety bond may be for the amount previously stated or in an amount that secures the completion of all guaranteed accommodations including all furniture, fixtures and other promised enhancements if the project is not yet finished. SB 897 becomes active on January 1st, 2010.