A bond can be canceled due to various reasons, including:
- Expiration of the bond term: If a bond reaches its maturity date, it gets canceled as the principal amount is paid back to the bondholder.
- Fulfillment of Obligation: In surety bonds, once the obligated party fulfills the terms of the bond agreement, the bond can be canceled.
- Default or Bankruptcy: A bond might be canceled if the issuer defaults or declares bankruptcy.
- Violation of bond terms: If the bondholder or issuer violates the bond agreement terms, the bond may be canceled.