A guaranty — a species of contract — is a collateral agreement for another’s undertaking and is an independent contract that imposes responsibilities different from those imposed in the agreement to which it is collateral. Specifically, a guaranty is a contract where a guarantor becomes secondarily liable for the obligation of a debtor in the event the…
Legal Articles
Personal Guarantees — Breach and Enforcement
A personal guarantee is a legal document which often accompanies a contract or loan instrument which ensures that the creditor (i.e., the person making the loan or on the other side of the contract) can personally collect money from the debtor in case of breach or default. Creditors insist on personal guarantees because it provides…