Types of collateral
The types of collateral are many and varied much more than one tends to think.
The types of collateral can be varied and no one type of collateral comes at the expense of another collateral.
Each type of security has advantages and disadvantages, and of course, it is the landlord who sets the requirements for the tenant for collateral. Here are some types of collateral.
• A monetary payment will be held with the landlord and will be returned to the tenant at the end of the lease period.
•A ‘Security’ check which will not be held with the landlord, and will not be repaid, unless the tenant violates the provisions of the contract.
• A promissory note to the seller (for the submission of this letter) signed by the tenants and sometimes also by the guarantors, which will be realized at the Execution Bureau, in case the tenant violates the provisions of the contract.
• Insurance. There are a large number of insurance policies on the market which can guarantee the payment of rent as well as compensate the landlord in case of damage to the apartment and in case of physical damage to tenants or a third party who will stay in the apartment.
• Payment of rent in advance. Not many people realize that rent is paid in advance to provide a kind of security, to ensure that the tenant will indeed pay the rent.
• Autonomous bank guarantee, ordinary guarantee, and indemnity letter.