What are the risks of bank loans as guarantors?
according to article 16 of the guarantee law, a guarantee includes a general guarantee and a joint and several liability guarantee, both of which are responsible for paying off debts under special circumstances.
The risks of bank loans as guarantors are mainly as follows:
1. When the debtor is unable or maliciously delays the arrears, the guarantor needs to repay the debts for the debtor;
2. If the debtor refuses to repay the debt, the bank has the right to take the guarantor to court, which will affect your personal credit;
3. The debtor doesn't repay the debt, but you need to bear the repayment responsibility. If you owe too much, it may lead to bankruptcy and life embarrassment.
what are the risks of being a loan guarantor?
Being a loan guarantor is risky. It is risky to vouch for your immediate family or your best friend.
1. If the borrower fails to repay the loan, the guarantor is liable for repayment. Before undertaking to be a guarantor, you must think carefully, because when you sign the money and debt guarantee, you are personally responsible for paying off the debts to the lending institution.
2. Even if the relationship between the guarantor and the debtor changes, for example, the husband guarantees his wife to make a house loan, and eventually they divorce, the letter of guarantee will not be affected by the dissolution of the marriage relationship, and it is still valid. In other words, once the guarantor signs as a guarantor, he becomes a guarantor forever, unless the borrower is approved by the lending institution to cancel the guarantor's qualification.
3. Under normal circumstances, the borrower repays the loan by himself, and the guarantor does not have to worry about it. However, the loan amount and monthly payment borrowed by the borrower will generally be shown in the credit record of the guarantor. When the guarantor needs to apply for any loan himself, the debt he guarantees will be regarded as his own debt, and usually the lending institution will count it among the debts, which may affect the loan amount of the guarantor.
4. Once the borrower is heavily in debt and unable to repay, or the borrower dies and flees, you will be fully liable for repayment.
What are the risks of the loan guarantor
The risks of the loan guarantor include: civil liability, civil joint liability, guarantee (guarantee) liability and compensation liability. After the guarantee contract is confirmed to be invalid, if the debtor, guarantor and creditor are at fault, they shall bear corresponding civil liabilities according to their faults. Article 388 of the Civil Code To establish a security interest, a security contract shall be concluded in accordance with the provisions of this Law and other laws. Guarantee contracts include mortgage contracts, pledge contracts and other contracts with guarantee functions. The guarantee contract is a subsidiary contract of the principal creditor's rights and debts contract. If the principal creditor's rights and debts contract is invalid, the guarantee contract is invalid, except as otherwise provided by law. After the guarantee contract is confirmed to be invalid, if the debtor, guarantor and creditor are at fault, they shall bear corresponding civil liabilities according to their faults. Article 389 The scope of guarantee of a security interest includes the principal creditor's right and its interest, liquidated damages, damages, expenses for keeping the secured property and realizing the security interest. Unless otherwise agreed by the parties, such agreement shall prevail. Article 39 During the guarantee period, if the secured property is damaged, lost or expropriated, the holder of the security interest may be given priority in compensation for the insurance money, compensation or compensation. If the performance period of the secured creditor's rights has not expired, the insurance money, compensation or compensation can also be deposited.
Let's stop here for the introduction of the risks of loans as guarantors.