guaranty-unlimited

name	guaranty-unlimited
language	en
description	Drafts a U.S. Unlimited Guaranty for commercial lending transactions. Triggers when user needs an uncapped personal or entity guaranty, credit enhancement, or unlimited recourse instrument for a loan closing. Produces an absolute guaranty of payment (not collection) with comprehensive waivers, subrogation subordination, and continuing-guaranty coverage.
tags	["agreement","drafting","transactional"]

Unlimited Guaranty

Generates a complete Unlimited Guaranty giving the Lender direct, uncapped recourse against a Guarantor for all present and future Borrower obligations.

Quick Start

Collect before drafting:

1. Credit documents — loan agreement, note, or facility defining the guaranteed Obligations
2. Parties — full legal names of Guarantor, Borrower, and Lender
3. Guarantor type — individual or entity (drives signature block and authority recitals)
4. Financial reporting — whether Lender requires ongoing financials from Guarantor

Document Sections

#	Section	Key Content
1	Definitions	Obligations (all present/future amounts), Credit Documents, parties
2	Guaranty of Payment	Absolute, unconditional; payment not collection — Lender may proceed directly against Guarantor
3	Unlimited Liability	No cap; covers principal, interest, fees, costs, expenses, indemnities
4	Waivers	Full checklist below
5	Subrogation & Reimbursement	Subordinated/waived until indefeasible payment in full
6	Continuing Guaranty	Survives modifications, renewals, extensions; covers post-execution obligations
7	Financial Covenants (if required)	Annual financials, MAC notice, other reporting
8	Governing Law & Jurisdiction	Match underlying loan documents
9	Jury Trial Waiver	Standard commercial waiver
10	Signature Block	Individual: name + date; Entity: officer title + authority recital

Required Waivers (Section 4)

Guarantor must waive all of the following:

• Presentment, demand for payment, protest, notice of dishonor
• Notice of acceptance of Guaranty
• Notice of creation or incurrence of new Obligations
• Notice of any Borrower or Lender action or inaction
• Right to require Lender to proceed first against Borrower or exhaust collateral
• Defense based on modification, extension, renewal, or amendment of Obligations
• All suretyship defenses (collateral impairment, co-guarantor release, etc.)
• Right to require marshaling of assets

Subrogation Language (Section 5)

Until all Obligations are indefeasibly paid in full and all Lender commitments are terminated, Guarantor waives and subordinates: (i) any subrogation right to Lender's claims against Borrower; (ii) any reimbursement or indemnity right from Borrower; and (iii) any right to participate in Lender-held security.

Pitfalls & Checks

• Payment not collection — Section 2 must expressly allow Lender to proceed against Guarantor without exhausting Borrower remedies or collateral
• "Indefeasibly paid in full" — always use this phrase, not merely "paid in full," to protect against bankruptcy preference/clawback
• Governing law — must match the underlying loan documents' choice of law and forum
• Entity authority — for entity Guarantors, include officer certificate or board resolution recital if Lender requires
• Continuing guaranty — confirm language covers obligations arising after execution
• [VERIFY] US jurisdiction only; state suretyship statutes may impose additional requirements
• [VERIFY] Anti-deficiency statutes (CA, AZ, others) may limit enforceability of certain waivers — flag for attorney review

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