I am confused about some aspects of aquiring a carnet and if anyone can help out I would really appreciate it.
I understand that the 3 common ways of getting a carnet are:
- put up the money youself
- get some sort of insurance
- get a bank guarantee

Now like a lot of people I can't to put up the money myself, I don't know too much about the insurance but the bank guarantee seems the most obvious choice.
What I would like to know is...why would the bank guarantee such a potentially large some of money??? I spoke to someone at the HU UK meeting and they said it only cost them £75 to get a bank guarantee. But I still don't see what's in it for the bank? Ok so I've had my account at my particular bank for many years, maybe they just want to keep me as a customer??? But if I am heading off on a big trip which could take years, why would they care if I held an account with them or not, as I am clearly not going to be putting my salary cheque in my account anymore. What's to stop me driving off into the sunset and selling my bike wherever I like and leaving them to cough up the expenses??(not that I intend to!)
They are making a guarantee to the RAC that they will pay up if anything happens, but what is their guarantee that they will get their money back? Do you have to put your house up as guarantee?? I do not own a house so I can't do that!
If anyone can clarify this for me I would be very grateful as it is a big concern of mine.

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Hi Paul,
I cannot speak for the UK. But this is what happens in Canada, where I took out carnets four times during the past six years. Each time I always put up the required amount myself, because I did not like the ways of the bank. My bank would have gladly underwritten the deposit, but they planned to charge me the same amount of interest as though it had been an outright loan, even so they could actually keep the money. Now, if you want a bank loan, you must have a collateral, i.e. a bank account with sufficient funds, a piece of property, or a car, or a rich relative or friend who is willing to sign as your guarantor. Banks are not charitable institutions. And once you're out of the country with your bike or car, they are no longer in control should you decide to sell it or lose it. So I suggest you approach your bank manager and ask him/her outright what guarantee they require to underwrite your carnet. You'll get the answer from the horse's mouth.

thanks Werner,
I will be speaking to my bank manager about this.

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Paul,

I got a bank guarantee for my carnet in 2001 (from the Farnham branch of NatWest, just down the road from you). It cost £75 and was no hassle once I'd found someone who knew who to talk to within the bank. Why they issue guarantees I don't know, but I guess they work on the assumption that you're going to return to the UK at some point and if you default on the carnet they can pursue you then.
If you're a long standing customer with a good credit record they must make a calculated guess that you'll pay it back if you have to.
As far as I was concerned it was far preferable to putting a large amount of cash down as security because I needed it to fund my travelling.
I'd be interested to hear what your bank manager says.....
Harvey

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no pipe, no slippers
www.chasingthesun.org

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no pipe, no slippers
www.chasingthesun.org