Personal Guarantee
A personal guarantee is a legally binding commitment by an individual to repay corporate or commercial debt if the primary borrower defaults, exposing personal assets to satisfy business obligations.
| Guarantee Characteristics | Terms |
| Liability type | Unlimited typically |
| Asset exposure | All personal assets |
| Duration | Until debt satisfied |
| Transferability | Usually non-transferable |
| Common Applications | Context |
| Commercial mortgages | Directors guarantee company debt |
| Corporate ownership | UBO backing entity loans |
| Business loans | Shareholder guarantees |
| Developer financing | Principal backing project loans |
| Protection Strategies | Approach |
| Limited guarantee | Cap at specific amount |
| Secured assets only | Specify collateral limits |
| Time limitation | Sunset after certain period |
| Joint guarantees | Multiple parties share exposure |
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