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Personal Guarantee On Promissory Note for the United States

Personal Guarantee On Promissory Note Template for United States

A Personal Guarantee On Promissory Note is a legally binding document used in the United States where an individual (guarantor) promises to assume responsibility for the payment of a debt or performance of an obligation detailed in a promissory note if the primary debtor defaults. This document combines elements of contract law and security law, governed by both federal and state-specific regulations, including the Uniform Commercial Code where applicable.

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Personal Guarantee On Promissory Note

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What is a Personal Guarantee On Promissory Note?

A Personal Guarantee On Promissory Note is commonly used in business and personal lending situations where additional security is required for a loan or credit arrangement. This document is particularly relevant when the primary borrower's creditworthiness alone is insufficient to secure the loan. The guarantee provides the creditor with additional security by allowing them to pursue the guarantor's personal assets if the primary debtor defaults. Under U.S. law, these guarantees must be in writing and typically include specific terms regarding the scope of the guarantee, conditions for enforcement, and rights of all parties involved.

What sections should be included in a Personal Guarantee On Promissory Note?

1. Parties: Identification of the Guarantor and the party to whom the guarantee is given (Creditor)

2. Background: Reference to the original promissory note and circumstances requiring the guarantee

3. Definitions: Key terms used in the guarantee including 'Obligations', 'Principal Debt', 'Default'

4. Guarantee: Core guarantee provisions and scope of the guarantee

5. Payment Terms: Conditions and timing of payments under the guarantee

6. Representations and Warranties: Guarantor's statements about their capacity and authority

7. Duration: Term of the guarantee and conditions for termination

What sections are optional to include in a Personal Guarantee On Promissory Note?

1. Security: Details of any collateral securing the guarantee - used when guarantee is secured by specific assets

2. Joint and Several Liability: Provisions for multiple guarantors - used when there is more than one guarantor

3. Subordination: Ranking of guarantee against other obligations - used when priority of obligations needs to be established

What schedules should be included in a Personal Guarantee On Promissory Note?

1. Original Promissory Note: Copy of the underlying promissory note being guaranteed

2. Security Details: Description of any assets provided as security (when guarantee is secured)

3. Payment Schedule: Details of payment obligations if different from original note

Authors

Alex Denne

Head of Growth (Open Source Law) @ tiktok成人版 | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

Jurisdiction

United States

Document Type

Promissory Note

Sector

Banking

Cost

Free to use
Clauses

























Industries

Truth in Lending Act (TILA): Federal law requiring disclosure of credit terms and standardizing the manner in which costs associated with borrowing are calculated and disclosed

Equal Credit Opportunity Act (ECOA): Federal law that prohibits discrimination in credit transactions based on race, color, religion, national origin, sex, marital status, age, or public assistance status

Fair Credit Reporting Act (FCRA): Federal law regulating the collection, dissemination, and use of consumer credit information

Statute of Frauds: Legal requirement that certain contracts, including guarantees, must be in writing and signed to be enforceable

State Contract Laws: State-specific laws governing contract formation, enforcement, and remedies that vary by jurisdiction

Uniform Commercial Code (UCC): State-adopted standardized set of laws governing commercial transactions, including provisions relevant to guarantees and secured transactions

State Usury Laws: State-specific laws that set maximum interest rates and regulate lending practices

State Statute of Limitations: Time limit within which legal action must be brought to enforce the guarantee or underlying note

Bankruptcy Laws: Federal laws governing bankruptcy proceedings that may affect the enforcement of guarantees and collection of debts

Consumer Protection Laws: State and federal laws designed to protect consumers in financial transactions and prevent unfair or deceptive practices

Notice Requirements: Legal requirements for providing notice to guarantors regarding changes in terms, defaults, or other significant events

Waiver Provisions: Legal provisions regarding what rights a guarantor can and cannot waive in the guarantee agreement

Teams

Employer, Employee, Start Date, Job Title, Department, Location, Probationary Period, Notice Period, Salary, Overtime, Vacation Pay, Statutory Holidays, Benefits, Bonus, Expenses, Working Hours, Rest Breaks, 聽Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination, 聽Severance Pay, Governing Law, Entire Agreemen

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