Personal Guaranty
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This is a personal guaranty in which a person (called the “guarantor”) agrees to be personally responsible for paying off a debt if the debt is not paid back to the lender by the debtor.
Available in MS Word. 3 pages.
A personal guaranty is used when a lender, creditor, or vendor requires additional reassurance of payment from a person before agreeing to make a loan or extend credit to another person. In this personal guaranty, a person (called a guarantor) promises to be personally responsible for repaying a loan in the event the debtor fails to pay. For example, a parent could agree to provide a personal guaranty for a student loan made to his child, or a business owner could provide a personal guaranty to a vendor for extending credit to his business.
Contents
Recitals
Agreement
1. Guarantee
2. Unconditional Nature of Loan
3. No Asset Transfer
4. Waiver
5. No Assignment
6. Governing Law
7. Entire Agreement
Notary Acknowledgment
How to Use
(1) Fill in the blanks with the appropriate information.
(2) Remove the yellow bracketed highlights.
(3) Review the document carefully to ensure it conforms with the parties’ agreement before signing.
FAQs
What is a personal guarantee?
A personal guarantee is a promise or agreement by a person called the “guarantor” to make himself or herself personally liable for a debt owed by someone or something else.
How are personal guarantees used?
Personal guarantees are used in situations where one person agrees to be liable if another person or entity (the “debtor”) fails to pay a debt. For example, a lender might be reluctant to loan money to a startup business. In that instance, in order to induce the lender to lend money to the business, the owner of the business might agree to be personally liable if the business does not pay back the loan in order to provide added assurance to the lender that the debt will be repaid.
