Guarantees

 

Don’t sign them but if you have to then make sure they are limited to the amount of the loan or at worst loan plus interest. Banks never volunteer any limitation so you will have to make a special request, and go hard. Whenever we see an unlimited guarantee the first thing we do is email the bank to limit the guarantee and to amend their guarantee document.

Always ensure that you know how much you are in for if it all falls over. Keep tabs on the person you are guaranteeing and make it your business to know their business. Make it a condition of the guarantee that the bank will report to you in writing.

When you can be released as guarantor make sure the bank confirms your release from the guarantee in writing.