Fideiussione Bancaria (Bank Guarantee)

A financial guarantee issued by a bank (or insurance) to ensure an obligation will be met. In real estate it appears notably in two contexts: (1) Off-plan purchases – Italian law (D. Lgs. 122/2005) requires developers to provide buyers a fideiussione guaranteeing the return of any deposit payments if the building is not completed. (2) Rentals – sometimes landlords request a fideiussione from a tenant (or their company) as additional security for rent. A fideiussione is essentially the bank acting as surety; if the debtor (developer or tenant) fails their obligation, the bank pays in their place. Developers’ bank guarantees protect buyers’ money in case of the developer’s bankruptcy or project failure. Fideiussioni can also guarantee performance of renovation works, payment of condo fees, etc., depending on the situation.