surety bond

Definitions (2)

1. A bond issued by an entity on behalf of a second party, guaranteeing that the second party will fulfill an obligation or series of obligations to a third party. In the event that the obligations are not met, the third party will recover its losses via the bond.
2. A fee that is charged when a person loses a physical security issued to him/her and has to have a duplicate issued.

Use surety bond in a sentence

After recent financial losses, the father began looking into surety bond investments to secure his financial future due to less market fluctuation.

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The inherent riskiness of the mortgage security led the investment bond to seek a surety bond from a third party before taking the chance of purchasing it.

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When my startup company wanted to buy steel on credit from a supplier, the supplier insisted it would do so only if my father's successful company issued a surety bond to guarantee the sale.

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