When I purchased a "C" grade apartment house, a few of the tenants didn't have enough money to pay down a deposit or the full 1st months rent so the old owner accepted a surety bond instead. When I filed my first claim against the bond, it was denied.
The Reasons were:
A) Bond was payable to the old owner and not me even though the "bond" was transferable to the new owner.
B) Lease was for 1 year and has expired. Bond had to be renewed with a new premium paid.
C) Tenant claimed they did no damage. For the Bond to pay out, I needed to have a verdict or judgement showing the damage.
The Bond was worthless because it would cost me more money to get the "proof" than it would cost me to just pay out of pocket and be done with it! --47.155.xx.xxx