Document background
A Guarantee Letter is commonly used in Singapore business transactions to provide security and assurance to creditors or contractual counterparties. This document, governed by Singapore law, creates a legally binding commitment from the guarantor to step in if the principal debtor defaults on their obligations. The Guarantee Letter must specify the scope of guaranteed obligations, maximum liability, duration, and enforcement mechanisms. It's particularly important in financial transactions, property leases, and commercial contracts where additional security is required beyond the principal debtor's covenant.
