• An appeals court on Monday massively reduced Trump's bond in his civil fraud trial.
• It was a rare turn of events, legal experts told Business Insider.
• But Trump is continuing to rack up interest, and he'll end up owing far more if he loses his appeal.

An appellate-court decision reducing former President Donald Trump's bond to $175 million was a win for the former president — and certainly a rare one, according to legal experts.

After being ordered to pony up his $454 million judgment following his New York civil fraud trial last month, Trump had told the court he couldn't secure a bond for that amount.

But the former president was tossed a last-minute lifeline Monday when an appeals court ordered a whopping 62% reduction in the size of the bond. He has 10 days to pay up.

Neil Pedersen, the owner of the surety-bond agency Pedersen & Sons, told Business Insider that in his company's 30-year history, he and his employees had handled thousands of bonds.

In that time, he's heard of only about a couple dozen instances when a New York appeals court reduced an appeal bond — and those involved far lower judgments.

"It's extremely rare," Pedersen said.

Appellate judges are reluctant to let the losers of lawsuits essentially offer IOUs — instead of a collateral-backed bond — while an appeal progresses, legal experts have explained.

Should Trump lose his appeal down the road, he'll owe the full amount almost immediately. And New York Attorney General Letitia James will be left chasing him for the remainder.

Eric Snyder, the bankruptcy chair of Wilk Auslander LLP, who routinely enforces judgments in New York, told BI he'd never seen a bond get reduced like this.

Snyder said the court might feel comfortable that Trump could pay the judgment if he were to lose his appeals.

He added that Trump wouldn't easily be able to sell shares in his properties, given that a prospective buyer would see a record of the judgment. Plus, Trump Tower is in New York — making it within reach of the attorney general's power if payment comes due.

Snyder also said the court's decision to reduce Trump's bond could suggest it might later lower Trump's total penalty.

"It might be an indication it'll get reduced on appeal," he said.

While the lowered bond buys Trump time, he'll still owe the entire sum if he loses on appeal. As part of Monday's decision, Trump is required to file a full appeal argument in time for the court's September 2024 session.

And for every day that passes, the amount owed is accruing interest — to the tune of roughly $112,000 a day.

Pedersen said that meant Trump could end up owing New York well over a half-billion dollars when all is said and done.

"Once his appeals are exhausted, he'll only have five to 10 days to satisfy the judgment, or whatever amount of the judgment is affirmed," Pedersen said.

Following a three-month trial, New York Supreme Court Justice Arthur Engoron found Trump and other Trump Organization executives liable for the nearly half-a-billion-dollar penalty last month. Engoron found they had conspired to inflate the value of their real-estate assets to dupe lenders.

Speaking to reporters Monday, Trump applauded the appellate court's decision to lower his bond.

"It will be my honor to post," he said, adding that it would be in "cash."

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