Capitalization Bond: Who Qualifies and What You Get
Learn how a Capitalization Bond works as an alternative security deposit for tenants in Brazil who do not have a guarantor.
A Capitalization Bond acts as a substitute for a traditional security deposit when you are renting a property but do not have a guarantor to back your lease.
Who it's for
This option is specifically for tenants who are unable to provide a guarantor (a person who promises to pay if you cannot) for their rental agreement.
What you get
It serves as an alternative to the standard security deposit. It provides the landlord with a financial guarantee to cover potential damages or unpaid rent during your tenancy.
What it costs you
To set this up, you must pay a lump sum deposit upfront. This money is held by an insurance company for the duration of your lease and is returned to you once the contract ends.
The catch to know
While you do receive your money back at the end of the lease, the amount returned is usually not adjusted for inflation, meaning its purchasing power might be lower when you get it back.
How to apply
- Find a property that accepts a Capitalization Bond instead of a guarantor.
- Contact an insurance company to set up the bond.
- Pay the required lump sum deposit.
- Provide proof of the bond to your landlord to finalize your lease.