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“A Comprehensive Guide to Drafting a Personal/Corporate Guarantee”

Service Description


A Personal/Corporate Guarantee is a legal commitment made by an individual or a corporation to assume responsibility for another’s financial obligation if that party fails to meet its commitment. This guarantee is often required in business transactions to secure loans or lease agreements, providing an added layer of security for lenders or lessors.


The need for a Personal/Corporate Guarantee arises in situations where a business or individual seeks financial assistance or enters into a contractual agreement but lacks sufficient credit history or assets to satisfy the lender or beneficiary of the agreement. The guarantee acts as a form of assurance for the fulfillment of the financial obligations.

How to Draft

To draft a Personal/Corporate Guarantee:

  1. Identification of Parties: Clearly identify the guarantor (the party providing the guarantee) and the beneficiary (the party receiving the guarantee).
  2. Principal Obligation: Describe the primary obligation being guaranteed, including relevant details such as loan amount, lease terms, or contract specifics.
  3. Extent of Liability: Define the extent of the guarantor’s liability. This can be limited to a specific amount or encompass the total obligation.
  4. Duration of Guarantee: State the duration for which the guarantee will be valid.
  5. Revocation Terms: Specify the conditions, if any, under which the guarantee can be revoked or terminated.
  6. Default Provisions: Outline the actions to be taken if the principal debtor defaults on their obligation.
  7. Jurisdiction and Governing Law: Indicate the legal jurisdiction and governing law applicable to the guarantee.
  8. Signatures: The document must be signed by the guarantor, and depending on the nature of the guarantee, it may also need to be witnessed or notarized.


The completed and signed Personal/Corporate Guarantee should be filed alongside the principal agreement it secures. The guarantor should retain a copy for their records, and additional copies should be provided to the beneficiary and the principal debtor.


A Personal/Corporate Guarantee is a critical document in many financial and contractual transactions, providing security and confidence to those extending credit or entering into agreements. Proper drafting and understanding of this legal tool are essential to protect the interests of all parties involved.