The short answer
A personal guarantee makes an owner personally responsible if the business does not pay. It must generally be in a signed writing, and it often outlasts the owner’s involvement in the business.
Where it fits in your case
When a lender, landlord, or vendor pursues an owner after the business defaults.
What to expect
Continuing guarantees can cover future debts until revoked in writing.
Business sales. A guarantee usually survives unless the creditor signs a release.
Vendors can generally pursue an owner only with a guarantee or a basis to disregard the entity.
Defenses may include changes to the underlying debt made without the guarantor’s consent.
What we need from you
The guarantee, the underlying contract or lease, and any amendments or releases.
Common misconceptions
“Selling the business ended my guarantee.” Usually not without a release.
“I signed as president, so it’s not personal.” A guarantee is personal by design.