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This Deed of Guarantee & Indemnity of Loan is suitable to be used where there is a loan agreement between the Lender (an individual) and the Debtor (an individual) where under the Loan Agreement there was either no guarantee or a further guarantee is required. This template allows for multiple Guarantors who can be individuals or companies.
This Deed of Guarantee & Indemnity of Loan contemplates that the Lender has made a loan to the Debtor or is making a loan simultaneously with the entering into of the Guarantee. This template also assumes that the Lender may make future advances to the Debtor under the Loan Agreement and that these future advances will also be secured by the Guarantee.
One of the most common ways of defending any claim under a Guarantee is for the Guarantor to say that they gave the Guarantee without fully understanding it or under some form of undue influence. LawLive therefore strongly recommends that the Guarantor obtains separate and independent legal advice on the Guarantee before giving it and that you (as Lender) obtain a letter from the Guarantor or from his/her/its solicitor to that effect ie. That they have sought and been given independent legal advice on the nature and effect of the Guarantee.
It is important that you (as Lender) know what the financial position is of the persons or companies who are giving you the guarantees. A guarantee from a company or individual with no assets is worthless. LawLive recommends that you obtain a statement of assets and liabilities of each proposed Guarantor and require them to sign it and date it as at the date of entering into the Guarantee.
This Deed of Guarantee & Indemnity of Loan attaches Notes to Deed of Guarantee of a Loan (version Three).
This Deed of Guarantee & Indemnity of Loan includes the following provisions:
1. Definitions and Interpretation
2. Guarantee and Indemnity
3. Demand on Guarantors
4. Guarantee not Affected by Various Matters
5. Guarantors Warranties and Declarations
6. Trust Provisions
8. Execution under Power of Attorney
9. Signing by the Lender
10. Only written matters bind the Lender
11. Governing Law
12. Independent Legal Advice
13. Joint and Several Liability