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영어

Project financing is known as a device to activate housing construction loan. But when the construction is interrupted because of the bankruptcy of the developer or contractor in a project where the houses under construction are pre selled, the loan credit becomes subordinated. That's because when the developer would pre sell houses, he has to buy a security which guarantees the safety of advance payment of consumers, and when the construction is interrupted. the guarantor doesn't secure the priority order of loan credit because of the cost overrun to carry out the guarantee. So the lenders are very reluctant to participate. As a method to solve the problem, this paper presents a surety bond which guarantees the completion of construction within the limit of contracted construction cost. Because the completion is done within the cost limit, loan credit holds prior order.