The rental
bank guarantee

The bank guarantee as a rental surety

To obtain a “bank” rental guarantee it is necessary, as its name suggests, to contact a bank and file a specific application for a bank guarantee. The deposit issued by the bank allows a tenant to provide a guarantee of payment to the lessor. The tenant’s bank acts as guarantor for the tenant, who replenishes the amount with the bank on a monthly basis during the first 3 years of the lease.

The rental bank guarantee is a guarantee that the bank gives on behalf of the tenant to the lessor. The bank guarantee covers the rental commitments of the tenant under the lease contract. The bank makes the tenant sign a guarantee contract which commits him to reconstitute with the bank the amount of the guarantee during the first years of the lease.

The bank guarantees the tenant to the lessor up to the amount of the rental guarantee indicated in the lease. The tenant agrees in exchange to replenish the amount of the guarantee with the bank through the payment of monthly payments. In general, the bank sets a period ranging from 1 year to 3 years to constitute by monthly payment the amount of the bank guarantee granted. If the tenant suspends the monthly payments, the bank will demand immediate payment of the full security.

Banks have put in place online processes on the Internet to formalize a request for a rental bank guarantee. However, not all of the steps can be taken online. setting up this type of guarantee requires at least a meeting with a branch in all banks to formalize the commitment. The acceptance of the file is not automatic, it is subject to the decision of an internal committee of each of the banks.

The bank that issues the rental bank guarantee is the one with which the lessee has a bank account that receives his income or replacement indemnities. Most banks in Belgium offer a rental bank guarantee service.

The bank guarantee release is done under the same circumstances as the classic rental guarantee blocked on a bank account. The bank makes the payment of the amount blocked as collateral according to the indications provided jointly by the tenant and the lessor. If the parties do not agree, the bank releases the rental guarantee only on the basis of an enforceable judicial judgment.