A sure sum is the payment required to settle a contract, including any repayment terms or schedules. It can also refer to a specific monetary value established for a negotiable instrument or investment product. The safe sum can decrease over time, while the safe date remains constant. The purpose is to establish a settlement price that is clearly understood and agreed to by both parties.
A sure sum is a term used to describe the payment required to settle a contract in full. An initial figure is named in the contract that establishes the agreement between the lender and the debtor, including any repayment terms or schedules that are mentioned in the contract provisions. The term can also be applied to any type of negotiable instrument in which a specific monetary value established for that instrument is claimed and recognized.
It is important to note that a certain amount is different from what is known as a certain date in that it addresses the amount due rather than when that amount is due. The safe date is the date identified in a contract as the final date by which the amount due can be paid in full without incurring any type of penalty charge. Most contracts will identify these two vital pieces of information at the outset. Unlike the safe date, which remains constant, the safe sum can decrease over time, assuming that the terms of the contract allow the debtor to make periodic payments on the outstanding balance.
The term also has meaning in investment situations. An example is with a digital option in which a financial product is traded through a fixed payment. Once the set price is established, that serves as the safe sum for the transaction, rather than basing payment on the value of the underlying asset or the strike price related to the product. Once the buyer delivers the determined amount to the seller, the transaction is considered settled or complete.
One of the purposes of a sure sum is to establish a settlement price that is clearly understood and agreed to by both parties. This means including the purchase price and any interest payments that may also apply if the balance due is withdrawn in a series of payments instead of a lump sum. Depending on the nature of this type of contract, the debtor may request the certain current amount, which is simply the full amount owed if the debtor were to pay the balance in full on the current date, instead of continuing to make payments until the debt is discharged. on a certain date. This is especially important to remember if the structure of the loan agreement allows you to cancel the agreement early and avoid some of the interest that would apply if the borrower simply continued to make payments on time until the due date.
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