The California Department of Real Estate titles this bond "Bond (Completion of Common Facilities)," form RE 611. It lets a subdivider get a Final Public Report and start selling before the shared amenities are physically finished, by guaranteeing those amenities will be completed for the homeowners association.
The bond guarantees that the subdivider will complete the common-area improvements listed in its Planned Construction Statement, free of liens, by the completion date stated on the bond. Common facilities usually include the clubhouse, pool, landscaping, private streets, and other shared amenities in a common-interest development. If the subdivider does not finish, the surety is answerable to the association for completion up to the bond amount.
Subdividers of condominiums, planned developments, and other common-interest communities use the RE 611 bond when they want to record and sell units before the shared amenities are done. Posting the bond is one of the ways the Department of Real Estate will issue a Final Public Report while construction of the common facilities is still underway.
The obligee is the homeowners association, not a city or county. This is different from a municipal subdivision or improvement bond, where the obligee is a public works department. The RE 611 form is issued under California Business and Professions Code section 11018.5(a)(2)(A). Any suit on the bond must be filed within two years of the latest completion date shown on the form.
The penal sum is based on the cost to complete the common facilities described in the Planned Construction Statement. There is no fixed dollar figure on the form. The amount is set per project from the estimated construction cost of the shared improvements.
The RE 611 bond works alongside a small family of Department of Real Estate forms: the RE 611A Planned Construction Statement that lists the improvements, the RE 611D standby letter of credit that some subdividers use in place of a bond, and the RE 613 Common Area Completion Security Agreement. We can help you match the right instrument to your project.
Complete our secure application and sign electronically. We review your file with A-rated surety carriers that write California developer bonds and follow up for any documents needed.
This page is a general summary and not legal advice. Bond requirements, forms, and amounts are set by the California Department of Real Estate and the obligee. Refer to the official DRE bond form and instructions for your project.