Surety
(Redirected from Guarantors)
Surety is a legal concept that involves a promise by one party to assume responsibility for the debt obligation of a borrower if that borrower defaults. The person or entity that provides this promise is known as the surety. The borrower is referred to as the principal, and the lender is the obligee. Surety is a form of guarantee and is commonly used in various types of contracts and financial transactions.
Types of Surety[edit | edit source]
There are several types of surety, including:
- Contract Surety: This type of surety is often used in the construction industry. It ensures that contractors fulfill their obligations under the terms of a contract. Common forms of contract surety include bid bonds, performance bonds, and payment bonds.
- Commercial Surety: This type of surety is used in various commercial transactions. It includes license and permit bonds, court bonds, and fiduciary bonds.
- Fidelity Surety: This type of surety protects against losses caused by the fraudulent or dishonest actions of employees. It is commonly used by businesses to safeguard against employee theft or embezzlement.
Key Elements[edit | edit source]
The key elements of a surety agreement include:
- Principal: The party whose obligation is guaranteed.
- Obligee: The party to whom the obligation is owed.
- Surety: The party that guarantees the obligation.
Legal Framework[edit | edit source]
Surety agreements are governed by contract law. The terms and conditions of the surety agreement are outlined in a written contract, which specifies the obligations of the principal, the rights of the obligee, and the responsibilities of the surety. If the principal fails to meet their obligations, the surety is required to fulfill those obligations or compensate the obligee.
Applications[edit | edit source]
Surety is used in various fields, including:
- Construction: Ensuring contractors complete projects according to the terms of the contract.
- Finance: Providing guarantees for loans and other financial transactions.
- Legal: Ensuring compliance with court orders and other legal obligations.
Related Concepts[edit | edit source]
See Also[edit | edit source]
References[edit | edit source]
External Links[edit | edit source]
Search WikiMD
Ad.Tired of being Overweight? Try W8MD's physician weight loss program.
Semaglutide (Ozempic / Wegovy and Tirzepatide (Mounjaro / Zepbound) available.
Advertise on WikiMD
WikiMD's Wellness Encyclopedia |
Let Food Be Thy Medicine Medicine Thy Food - Hippocrates |
Translate this page: - East Asian
中文,
日本,
한국어,
South Asian
हिन्दी,
தமிழ்,
తెలుగు,
Urdu,
ಕನ್ನಡ,
Southeast Asian
Indonesian,
Vietnamese,
Thai,
မြန်မာဘာသာ,
বাংলা
European
español,
Deutsch,
français,
Greek,
português do Brasil,
polski,
română,
русский,
Nederlands,
norsk,
svenska,
suomi,
Italian
Middle Eastern & African
عربى,
Turkish,
Persian,
Hebrew,
Afrikaans,
isiZulu,
Kiswahili,
Other
Bulgarian,
Hungarian,
Czech,
Swedish,
മലയാളം,
मराठी,
ਪੰਜਾਬੀ,
ગુજરાતી,
Portuguese,
Ukrainian
Medical Disclaimer: WikiMD is not a substitute for professional medical advice. The information on WikiMD is provided as an information resource only, may be incorrect, outdated or misleading, and is not to be used or relied on for any diagnostic or treatment purposes. Please consult your health care provider before making any healthcare decisions or for guidance about a specific medical condition. WikiMD expressly disclaims responsibility, and shall have no liability, for any damages, loss, injury, or liability whatsoever suffered as a result of your reliance on the information contained in this site. By visiting this site you agree to the foregoing terms and conditions, which may from time to time be changed or supplemented by WikiMD. If you do not agree to the foregoing terms and conditions, you should not enter or use this site. See full disclaimer.
Credits:Most images are courtesy of Wikimedia commons, and templates Wikipedia, licensed under CC BY SA or similar.
Contributors: Prab R. Tumpati, MD