surety bond
A "surety bond" is a financial and legal tool used to guarantee the performance or obligations of one party to another, involving a third-party guarantor.
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Definition
C1Law
(technical)A three-party agreement where a guarantor ensures that one party will meet their legal or contractual obligations to another.
Example
- The contractor was required to obtain a surety bond before beginning the construction project.
C1Finance
(technical)A financial guarantee that one party will fulfill their commitments, with a third party covering losses if those commitments are not met.
Example
- The company secured a surety bond to reassure investors of their financial stability.
Similar
Terms that have similar or relatively close meanings to "surety bond":