Personal Guarantee Template

If you need a guarantor for a loan or have been asked to be a guarantor for a loan, you might want to know exactly what it is and what you are required to do. Using an agreement template can help you know the risks and procedures for loan guarantees.


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What is a Loan Personal Guarantee?

This loan agreement template allows a person to take responsibility for a loan in the case that the original borrower stops making payments or can’t pay back the loan. Getting a personal loan is usually much easier when there is a guarantor because the lender may feel more confident in lending money knowing there are two people that can get their money back from.

Sometimes certain lenders or loan amounts may require a guarantor. In this case, the lender might not fully trust the borrower to pay the money back and they want to make sure there is a backup plan in case the borrower begins to default on the loan.

The personal guarantor is held responsible for paying the loan or a percentage of the loan back to the lending company. If you are being asked to be a personal guarantor for someone, ensure that you trust them and you are willing to cover them if they need it.

Remember that a lender can also take the guarantor’s assets as collateral or resell them for money if the guarantor doesn’t begin to make payments within a specified time. If the guarantor and borrower have a personal relationship, they might also be in charge of following up with the borrower and trying to get some of the money for the lender.

Overall, a loan personal guarantee can be a big responsibility depending on the individual or the company.

What Are the Types of Personal Guarantees?

There are a few types of personal guarantees. The first one is a limited guarantee. This allows creditors to collect a definite monetary amount or a certain percentage of the principal’s remaining balance.  This is usually used if several different people will pay back parts of the loan or debt for the borrower.

An unlimited guarantee gives the principal full liability for the full remaining balance of the loan. In this case, if a borrower or business is not able to make their payments and commitments to their loan, the lender is entitled to get the full remaining balance.

Who Might Need a Personal Guarantee?

Personal guarantees are more common for certain types of companies or individuals. Sometimes you might also need a personal guarantee just because the loan company asks you for one.

Always make sure you know why the company is asking for a personal guarantee. If you have been asked to be a guarantor, remember that all your personal information will be given to the other person or company. Make sure that they are reputable and you are comfortable giving your information out.

Trading companies

Trading companies often need personal guarantees because they do business with so many different organizations. They also do various business transactions. They use a personal guarantee document to ensure that they comply with all the terms and conditions put into the agreement. The entity that signs the document is in charge of ensuring that they comply with all the stipulations laid out in the agreement.

Insurance providers

Many insurance providers will ask for a personal guarantee so that the applicant’s payments will still be received if they do not retain insurance coverage. Some insurance providers will even ask for several personal guarantees.

Hiring managers

In this case, the personal guarantee will serve as a witness that the person being hired is of good character and their employment application is correct.  The guarantor may also verify the person’s strengths and weaknesses and attest to how they worked in their previous company. It’s simple to verify the applicant’s claims and background.

Landlords and lease property owners

This is used for people who are renting out property and who want to ensure they will get their rent money. A personal guarantor will have to pay any dues or rent payments that are late or not paid for. The form will give all the personal information to the landlord so they can contact the guarantor in case there is a problem with payment or past due fees.

What Should Be Included in a Personal Guarantee?

A loan personal guarantee has some basic components that need to be completed to ensure that the agreement is complete and can be used lawfully. Make sure you read all the components first before you sign anything and ensure that you agree with all the terms and conditions that are being set forth.

All loan details

All the personal loan details need to be laid out clearly. This includes the total loan amount balance, the state in which the loan was given, the interest amount, and any other important details. The state needs to be included because each state has different lending standards.

Lender details

Here all of the personal details of the lender need to be included. These are the full name, phone number, email address, and mailing address.

Borrower details

Like the lender, all the borrower details need to be written in the template. They need to include the full name, mailing address, phone number, and email address.

Guarantor details

In the personal loan guarantee template, the guarantor’s details need to be included as well so that the lender or company can contact them if they need to receive payment or have other financial issues with the borrower. You will need to include the full name, phone number, email address, and mailing address.


This will be the date that the template is being written or the day that the agreement is taking place.


Each personal loan guarantee form will need several signatures to make it valid. It will need the borrower’s signature, the lender’s signature, and the guarantor’s signature.

Filling Out the Loan Personal Guarantee Template

Filling out the template is straightforward and shouldn’t take too long once you have all the loan details and personal information from all the parties.

Indicate the parties

Here you will need to write the personal information of all three of the parties. The lender, borrower, and guarantor need to write their full names and mailing addresses along with some contact information.

Indicate the loan details

The lender will write in words and numbers the loan amount they are giving and the city and state that the loan is being given. They will also include who they are giving the loan to and the date that this agreement is taking place.

Indicate the state

Write the state that the loan is being given in to acknowledge that the contract follows the rules of that state.


All three people will need to sign, print, and date the end of the form. Make sure the print names are legible.


Most personal loan guarantees need to be notarized. All three parties should sign in front of the witness. Then, the notary will sign and stamp the form to make it official.

Published: Jun 18, 2022