Guarantee of contract debt OR Deed of guarantee of loan
- Solicitor approved
- Plain English makes editing easy
- Guidance notes included
- Money back guarantee
About this document
This is a professionally drawn, short agreement which identifies an original contract, then ties a new guarantor to it, to stand in the shoes of the debtor, should that be necessary.
The agreement provides an option for changed terms of payment should you so require. You could change any term in the original contract. For example, the debtor may agree to an increased rate of default interest, or the creditor to extended payments or a different schedule of work against which payments are made. (If you make a change which affects the obligations of the creditor or debtor, they must sign too. If that happens, no-one needs to sign as a deed.)
Nineteen year old entrepreneur borrows from friend of family to start new business. Loan requires monthly payments. Borrower fails to meet them. His father agrees to provide “after the event” guarantee. Lender is happy and son can carry on with his business. No change to terms of original agreement.
Website writer agrees to write website for new limited company. No guarantee in the contract. Before it is completed, client decides to add a great deal more work. Writer now worried about payment, so insists on directors of client company guaranteeing payment for the enlarged contract. This agreement would include adding a new schedule to the original agreement, by reference, and new schedule of payments.
Builder agrees to build a house against stage payments. When house up to first floor level, client fails to make a payment as required by the contract. Builder threatens to walk out and video the story for Facebook. Client persuades brother-in-law to give guarantee of the debt as instalments become due. Builder agrees to complete the contract.
The law in this document
There is no modern statutory law relating to guarantees. This document is based on contract common law.
In these examples, the guarantee is for a loan or debt. If you are looking for a guarantee for performance rather than payment, look at Guarantee of contract performance.
Net Lawman offers other document templates related to new guarantees at Guarantees and Indemnities.
Agreement features and contents
The key benefit of using this document over adding a guarantee paragraph to the original contract is the simplicity of use. There is no need to edit and agree the original. That means less room for making a mistake and invalidating the original.
- Can join one or more guarantors
- Guarantee for all aspects of the original contract
- Option to change the terms of original agreement
- Option to limit the guarantee if necessary
- Guarantor can be a business or individual (as a personal guarantee)
- Suitable for any type of contract
This document was written by a solicitor for Net Lawman. It complies with current Australian law.
What other customers thought
Average customer rating
By Shane Hodson 10 November 2016
The service enables me to draft documents very quickly.
"Loved it mate, was in somewhat bitter dispute with ex partner, loads of expensive meetings nothing sorted. Got your form, edited it up sent it over -bang, signed, sealed and delivered in 10 mins. Excellent"Ken Warren, Director The Golden Bough
"A very useful find for an SME looking for good legal documentation."iTMS Software Pty Ltd
"Searching for a form, it was great to see the forms specifying the different states but could be better if the states were made bold so it was easier to find the state that's needed. Otherwise, everything was excellent."Dawn Logan