A guarantee is a commitment by an individual or an institution to cover someone else’s debt if that person fails to pay. It serves as a way to secure a loan, and in the case of mortgages, banks may require a guarantor if they believe the applicant’s income is insufficient to cover the debt. In such cases, the guarantor is usually a family member who agrees to take on the responsibility and pay the debt from their own assets in the event of default.
There is also the aval bancario (guarantee by bank), designed to protect buyers of newly built properties in case the developerA promotora or developer is a company or individual that builds residential or commercial buildings with the aim of selling or renting them out. The developer manages the entire process—from purchasin... More fails to complete the construction or deliver the property as agreed. This is a legal requirement in all off-plan property sales. If the developerA promotora or developer is a company or individual that builds residential or commercial buildings with the aim of selling or renting them out. The developer manages the entire process—from purchasin... More does not fulfil their obligations, the bank must refund all payments made by the buyer, plus interest.
