May a letter of credit or property bond be substituted for the surety bond required by the Act?
No. The regulations require a bond on which there is a corporate surety authorized to do business in Virginia. This was a matter which the Bar explored at some length as it developed the CRESPA regulations. The General Counsel for the SCC, who have dealt with surety bonds on a regular basis, advised the Bar that they have experienced a great deal of difficulty with letters of credit and property bonds. The Act would require amendment to allow these types of vehicles to suffice, and criteria would be required to determine what would be acceptable.
