Reply: 1
From: Rolf Latham
Hi Rix
Instead of you using cash for something where the buyer does not want or cant use th cash anyway, you can use a bank guarantee.
Put simply tis a piece of paper that says the bank will pay the holder X at a particular time.
For eg, you dont want to tie up your 10 % depsoit for ever with a long settlement IP.
So you would use a bank guarantee instead of cash or Deposit bond.
The major advantage of guarantee over bond is that you do not need formal finance approval to get a guarantee for a deposit. With a bond you generally need finance approval.
Cost varies but is about the same as a bond.
Disadvante with guarantee, if youre a normal player you need to back the guarantee with a cash deposit or equity.
Ta
Rolf
