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For example a letter of credit could be used in the delivery of goods or the completion of a service. The seller may request that the buyer obtain a letter of credit before the transaction occurs. The buyer would purchase this letter of credit from a bank and forward it to the seller's bank. bank guarantee, like a line of credit, guarantees a sum of money to a beneficiary. Unlike a line of credit, the sum is only paid if the opposing party does not fulfill the stipulated obligations under the contract.
Best Answer: PMI, MIP: PMI (private mortgage Insurance), or MIP (mortgage insurance premium) may be required by your lender on a conventional loan if your loan-to-value ratio (LTV) is above 80 % or more.unding Fee: VA loans have a Funding Fee that can be as high as 1.875% and have a maximum guarantee of $46,000.00. If your loan amount is above 80% of the property's value based on the appraisal or the selling price (whichever is less) you may have to pay for mortgage insurance. Source(s): SanJoseNotary Â· 7 years ago.