What is and what is the Bail Bond?
Renting a property can be profitable for the lessor and interesting for the renter. This relationship, however, can be at risk if the agreement between the two parties is not made on the basis of the law. A contract that benefits both and brings collateral in the offer of the property and obligations on payments can avoid many problems.
On the side of the landlord, an important item is the property being in good conditions of use. For the lessee, a certification that the value of the rent and other charges in the contract will be paid is the initial condition.
There are five guarantee options, chosen by the owner of the property, foreseen in the Tenancy Law: guarantor, capitalization title, guarantee payment, letter of guarantee and bail bond.
Types of rental guarantee
Among all, the guarantor is usually the most chosen, but presents risks as not always the guarantors are reliable, the landlord can end up damaged at the end of the contract, and be a hindrance for the lessee, who even pay for a guarantor of rent, often a stalker. In addition, if the renter wants to rent in another city or state, it will be more difficult to find someone.
Another choice is the security deposit, in which the tenant deposits the equivalent of three months of rent. An apparently good alternative, but in case of default and the need for an eviction action, the judicial deadline becomes greater and the landlord ends up being harmed.
Advantages of bail bond
Real estate agents have preferred lease surety insurance and encourage homeowners and renters to choose this guarantee for the advantages to all parties involved. The first of these is practicality at the time of negotiation, since it does not require the indication of third parties, and makes the leasing process less bureaucratic.
Advantages for the real estate companies are also sure to receive the administration fee and a reduction of costs with legal assistance, paid by the insurer. The risks are much smaller, almost nil.
The owners benefit from the insurance by ensuring the contract’s compliance by the insurer, the security against professional guarantors and can cover damages and paint the property at the end of the contract.
The advantages to renters begin by excluding the need for a guarantor for contract approval, which avoids certain constraints. The approval time reduces from days or months to a maximum of 48 hours, which is a good thing. Insurers can facilitate payment up to 10 times. And depending on the insured there are extra coverages with repairs, discounts on carriers for the change and other services.
The cost of this insurance is usually the renter’s, but the negotiation is free, and the owner can afford 50%, for example.