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Limited Suretyship – Time
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Limited Suretyship – Time
Suretyship with payment guarantee and termination date limits guarantor’s liability to outstanding debt.
- Liability limitation.
- Defined termination date.
- Guaranteed debt resolution.
LIMITED SURETYSHIP – TIME
Summary A Suretyship limited by Time may be used where a debt is owed or may in the future be owed by someone, and additional security is required in the form of another person accepting personal liability for the debt. This suretyship limits the surety’s liability by imposing a termination date, whereafter the suretyship obligation will either end or be limited to the debt outstanding on the termination date.
Why do I need a Suretyship? A Limited Suretyship – Time gives a supplier or creditor additional security. If the customer or debtor defaults, the creditor may use the suretyship to demand payment from the surety. If your business has customers or debtors that are likely to owe money, for example the provision of goods and services on credit, then this Suretyship may be considered to reduce the risk of non-payment. Particularly if your customers or debtors are legal entities such as companies or trusts, where the directors, shareholders or trustees can be requested to personally guarantee the entity’s debt. But it can also be used by someone standing surety for their spouse, parent, child, friend or partner.
What does the Suretyship look like? This template suretyship can be printed onto two pages.
What do you need to do to use a Suretyship?
- Read the sample suretyship document to ensure that it suits your requirements. Make changes as required.
- Complete the relevant details and get the surety or sureties to sign.
This is a limited payment guarantee. We also have an Unlimited Suretyship if you need the guarantors to sign an unlimited payment undertaking.
A specialist’s advice should be sought, specifically if the underlying debt is subject to the National Credit Act 34 of 2005.
Also viewed: Customer Acknowledgement of Payment Terms
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