What is the more prevailing Assured Return or Lease guarantee?

What are assured returns?

Assured returns refer to a promised return that you will acquire in any livelihood. This return could be any form, like interest payout on a loan. This loan can be in the form of a bond or any other security. Assured returns are different from guaranteed returns, as these returns have a meaning, that if things go wrong or the market conditions go down financially, you may not get the interest payout or desired returns.

What is a lease guarantee?

A lease guarantee is referred to as an official agreement signed by the owner or the landlord, tenant and in addition, a third party who meets the monetary requirements of the owner, being a guarantor in between. A lease guarantor serves as a financial intermediary as is responsible for the tenant’s defaults, or not in time payments. This helps the tenant get protected from eviction. The purpose of a lease guarantee is to bestow protection to both tenant and the landlord. If a tenant does not fulfill the landlord’s credit requirement, the owner may propose a lease guarantee, giving you a mutually beneficial if negotiated accurately.

Real estate schemes that offer a lease and rent-back option to buyers are also returning schemes. For example, suppose a builder or a developer has a recreational project such as a resort or a hotel and sells individual rooms to the buyers. Now, for the buyer, the deal comprises an annual rent to pay by the builder to the buyer for a fixed period of time. So this is also a type of assured return.

Who can guarantee a lease?

So here is the answer to your query. If you are looking for a guarantor on your lease, you can have the following options.

  • Corporations- The most common lease type requiring a guarantor is retail, which is often under the umbrella of a corporation. The asset of the tenant will be taken into account, but the new business already has protection from its larger counterparts.
  • Banks- if you are up for someone who can be a sign a lease and be a guarantor for you and you are not automatically guaranteed under a corporation, banks can be the best option to rely on. Banks have an easily recognizable reputation and standing credit, and landlords may seek immediate encashment without legal action if there is a default. So this is the best option for you in this situation.
  • Individuals- An individual may sign as your guarantor, but keep in mind that their assets as an independent will be taken into account when being considered as your guarantor.

When you invest your funds in a property; it can be of any type commercial or residential, you always look for more advantages and perks offered. Both assured returns and lease guarantees are prevailing in their positions. You just need to analyze your needs and market strategies and plan according to them. This will help you earn a good profit.

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