Glossary Of Debt Management & Financial Terms
Guarantor
Someone who guarantees another persons or entities (e.g. limited companies) debts or other liabilities. This is usually undertaken when the borrowing could not take place with just the main account holder being named as a debtor, so that in the event that the main account holder could not keep up repayments, the guarantor would then be responsible for the payment of the debt. An example of this would be an unsecured loan for a limited company, where the director may have to put his name down as a guarantor, to protect the credit providing company in the event that the debtor company went into liquidation.
See Liquidation, Debt, Debtor, Creditor, Limited Company.
