What are bank guarantees

Now let’s look at the main types of bank guarantees, they are the main applications of this service.

Guarantee of payment is Bank guarantees the implementation of a particular principal payment in favor of the beneficiary.

Performance bond-bank guarantees the fulfillment of all financial obligations for a specific contract/contract, for example, a number of payments, meet their deadlines, etc.

Advance payment guarantee is a guarantee confirming that, in certain circumstances, made the down payment will be returned to the beneficiary. For example, if you are not satisfied the obligation on the part of the principal will not be a contract, will not be winning the contest, etc.

Tender guarantee is a very popular current bank guarantee, providing for participation in tenders conducted by the State. In this case, the Bank-guarantor guarantees the fulfillment of the principal is not current and future contract, if it wins the tender.

Customs guarantee-a bank guarantee ensuring payment of customer of customs duties and taxes, in some cases, required for the carriage of goods across the customs border.

Tourist firm guarantee (the tour operator or travel agent) - document guaranteeing the execution of the company’s obligations to its customers in the field of tourism.

Bank guarantees can be used to secure obligations both domestically and for export-import contracts. They are often used to conclude contracts with deferred payment or giving commodity loans. When you do this, the higher the rating and the reliability of the Bank, the more weight is its warranty. For example, a major international supplier may not accept guarantee a small domestic bank.

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mortgage bank guarantee in case of non payment

The mortgage bank guarantee in case of non-payment-The mortgage is a contract between a bank and its debtor client. It is a way for the bank to recover its unpaid debts and the debtor a sign of commitment. The mortgage is always on real property which the debtor is the owner.

Irrevocable bank guarantee

Irrevocable bank guarantee - this is the most reliable way to ensure commitment. Since it is assumed that the bank (guarantor) vouches for his client (the principal) in front of his client (beneficiary) to the case where the principal can not fulfill its obligations. A irrevocability assumes that the bank in any way be responsible.

Bank guarantee in the Savings Bank

Bank guarantee in the Savings Bank-Bargaining is always fraught with risk as one of the parties may be unable to meet its financial obligations. Avoid such a situation will help the bank guarantee. Approach to the selection of the bank must be serious because of its reliability will depend on your reputation.

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What are bank guarantees
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