We’ve all heard on the news, “So-and-so has been released on $50,000 bail.” But what does this really mean? What is a bail? How does it differ from a Bail Bond?
When someone is arrested for a crime, they are held in jail until their court date, until the judge decides to let them go on their own recognizance, or until they are released on bail.
*Please note that we (Surety Solutions) do not offer Bail Bonds. This post is meant to be an informational post.*
Bail is a set amount of money that acts as insurance between the court and the person in jail (the defendant.) Defendants have the option to pay their bail in cash, but many cannot do this.
Since bail is often set at a high amount, most defendants are financially unable to post bail by themselves. They seek help from a bail agent, or Bail Bondsman, who posts a Bail Bond for them.
A judge sets a bail amount. If the defendant cannot pay the bail amount on their own, they can seek help from a Bail bondsman in the form of a Bail Bond.
To post a Bail Bond, a defendant is usually required to pay a Bail bondsman 10% of the bail amount.
The Bail bondsman will then secure the rest of the bail amount in the form of collateral. If the defendant does not have enough collateral, the Bail Bondsman might seek out relatives and friends to assist in covering the bail.
Oftentimes, an additional cash payment plus full collateral is required for a Bail Bond to be posted.
What happens next depends on if the defendant appears in court after being released.
For example, John is arrested. The court set John’s bail at $10,000. John wants to be released from jail but he does not have $10,000 in cash, so he seeks help from a Bail bondsman to post a Bail Bond for him.
The bondsman requires $1,000 to post a Bail Bond for John, thus releasing him from jail.
For the other $9,000 of bail, the bondsman secures collateral from John and/or John’s family. Collateral could be in the form of a car, a house, jewelry, etc.
If John had posted the $10,000 in cash, he would be entitled to a refund at the conclusion of the case, regardless of the outcome.
If you would like more information on the Bail Bond process, check out this great post: “Frequently Asked Questions About Bail Bonds”.
Most surety companies (including us, Surety Solutions, A Gallagher Company) do not write Bail Bonds because of the underwriting problems associated with them. Bail Bonds are among the most hazardous of bonds to write.
This is because if the defendant fails to appear in court, the surety bond company that issued the bond is liable for the full bond penalty. Of course, due to the nature of surety bonds, the surety company would seek out compensation from the defendant in order to recover any penalty they had to pay.
Some states prohibit Bail Bondsman (Illinois, Kentucky, Oregon, and Wisconsin). These states still have Bail Bonds, but the 10% payment of the bond goes to the court and not a bondsman.
It is important to understand the risk involved in Bail Bonds. Underwriters will evaluate the total risk of posting a Bail Bond, including personal life, financial situation, family circumstance, and the case itself, before issuing a bond.
Approval is not easy and often requires other people to indemnify, or co-sign, for the defendant.