A Letter of Guarantee (LoG) is issued by the approving bank once the home loan application is approved. This lets the seller know that the bank is guaranteeing to pay them up to a specified amount on behalf of the client.
The LoG needs to signed by the Property Seller (and/or their authorized signatory) to signify their concurrence on the amount being guaranteed. Once signed, this needs to be returned to the bank in order to facilitate the release of the proceeds.
Note: Letter of Guarantees (LoG) are provided by the Banks using their own format.