What’s the Difference Between a Payment Bond and a Performance Bond?

[jackkyle]

Hi all,

I’m trying to understand the differences between payment and performance bonds. They both seem related to construction projects and surety, but I’m not quite clear on how they differ in purpose and function.

Could someone explain in simple terms what each bond covers, and when you would typically need one versus the other? Any examples or tips would be really helpful!

Thanks so much!
Jackkyle