Bearer Instrument | Propertylogy

Bearer Instrument

By on July 2, 2019

A bearer instrument is a security that has no registered owner, and anyone who has possession of it would be able to receive payment by presenting it.

While such security instruments have it’s drawbacks, there are certain circumstances when they are the preferred type of security.

For example, when the issuer cannot be certain of who would be receiving the payment, or when unable to ascertain the legal name of the recipient.

However in such cases, the issuer would usually require the receiver to endorse a receipt to certify that payment has indeed been made via a bearer instrument.

Some types of shares and bonds are structured as bearer instruments.

Real estate understandably are not.

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