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Simple English definitions for legal terms
guarantee
Read a random definition: unskilled work
A quick definition of guarantee:
A guarantee is a promise made to someone who will receive payment if the person who owes the money cannot pay it back. The guarantee has the right to be paid before anyone else, including the person who lent the money. Sometimes, people use the word guaranty instead of guarantee, but they mean the same thing. It's important to understand the context of the word to know what it means.
A more thorough explanation:
A guarantee is a person or entity that is promised payment as a creditor. This means that if someone owes money to a creditor, and that creditor has a guarantee, the guarantee has the right to receive payment before the creditor does.
For example, let's say that John owes $100 to a bank. The bank has a guarantee from Jane, which means that if John doesn't pay back the $100, Jane has the right to receive payment before the bank does.
Another example could be a landlord who requires a guarantee from a tenant. This means that if the tenant doesn't pay rent, the landlord can go to the guarantee to receive payment.
Overall, a guarantee is a way to ensure that someone will receive payment if a debt is not paid. It is important to understand the context of the term to fully understand its meaning.
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