Bailor

AAA

DEFINITION of 'Bailor'

An individual who temporarily relinquishes possession but not ownership of a good or other property under a bailment. The bailor entrusts the possession of the good or property to another individual, known as the bailee. A bailment is usually a contractual agreement between the bailor and the bailee that specifies the terms and purpose of the change in possession.

BREAKING DOWN 'Bailor'

A bailor transfers possession, but not ownership, of a good to another party, known as the bailee, in the event of a bailment. While the good is in the bailee's possession, the bailor is still the rightful owner. A bailor/bailee relationship can be illustrated in the management of investment portfolios. A bailor can designate a bailee to supervise an investment portfolio for a particular time period. While the bailee does not own the portfolio, the bailor entrusts the chosen individual to ensure that the portfolio is in good hands until such time that the bailor can or wishes to resume the duties of managing the portfolio.

RELATED TERMS
  1. Bailee

    An individual who temporarily gains possession, but not ownership, ...
  2. Bailment

    The contractual transfer of possession of assets or property ...
  3. Collateral

    Property or other assets that a borrower offers a lender to secure ...
  4. Property

    1. Anything over which a person or business has legal title. ...
  5. Lease

    A legal document outlining the terms under which one party agrees ...
  6. Consignment

    An arrangement whereby goods are left in the possession of another ...
Related Articles
  1. Personal Finance

    Should You Pawn Your Valuables?

    Pawnshops provide easy access to short-term loans, but they aren't the only option.
  2. Options & Futures

    Home-Equity Loans: The Costs

    Learn the factors to consider when comparing the different programs offered by various lenders.
  3. Options & Futures

    Car Title Loans: Good Option For Fast Cash?

    These loans provide fast cash, but they could leave you deeper in debt - and without a car.
  4. Entrepreneurship

    Risks Associated With Government Contracts

    Government contracts can be rewarding, but they also come with a variety of risks.
  5. Entrepreneurship

    10 Public Companies That Rely On Govt. Contracts

    We look at 10 of the top public companies whose businesses rely on U.S. government contracts.
  6. Economics

    How Does an Operating Lease Work?

    Operating lease is a term used mostly in accounting to denote a lease that gives the lessee rights to use and operate an asset without ownership.
  7. Entrepreneurship

    Lockheed Martin Is Tight With The US Government

    The relationship between Lockheed Martin and the U.S. government is long-standing and the company's biggest revenue source, but it may be deteriorating.
  8. Home & Auto

    ‘Turnkey’ Properties: A Sensible Investment?

    Turnkey properties can make sense - for people who want a real estate investment without truly being in the real estate business.
  9. Economics

    Understanding Covenants

    A covenant is a term placed in a loan that requires the borrower to either maintain or refrain from certain business activities.
  10. Economics

    What is Earnest Money?

    An earnest money deposit shows the seller that a buyer is serious about purchasing a property.
RELATED FAQS
  1. Are waivers of subrogation clauses ever ineffective in preventing a third-party lawsuit?

    Sometimes waiver of subrogation clauses are ineffective at preventing a third-party lawsuits. In determining who is responsible ... Read Full Answer >>
  2. What is an alienation clause?

    Whether used in reference to insurance policies, mortgages or commercial loans, an alienation clause stipulates that should ... Read Full Answer >>

You May Also Like

Hot Definitions
  1. Alligator Spread

    An unprofitable spread that occurs as a result of large commissions charged on the transaction, regardless of favorable market ...
  2. Tiger Cub Economies

    The four Southeast Asian economies of Indonesia, Malaysia, the Philippines and Thailand. Tiger cub economy indicates that ...
  3. Gorilla

    A company that dominates an industry without having a complete monopoly. A gorilla firm has large control of the pricing ...
  4. Elephants

    Slang for large institutions that have the funds to make high volumes trades. Due to the large volumes of stock that elephants ...
  5. Widow's Exemption

    In general terms, a widow's exemption refers to the amount that can be deducted from taxable income by a widow, thereby reducing ...
  6. Wedding Warrant

    A warrant that can only be exercised if the host asset, typically a bond or preferred stock, is surrendered. Until the call ...
Trading Center
×

You are using adblocking software

Want access to all of Investopedia? Add us to your “whitelist”
so you'll never miss a feature!