How to Share a Personal Guarantee of Debt

Sharing a personal guarantee of debt is easily accomplished by applying for credit with another person. The lender will check each applicant's credit and will hold each equally responsible for the entire debt. It is not possible to share a percentage of a debt. Lenders hold all parties on the loan fully responsible even if only one of the borrowers uses the proceeds from the loan. Investors in small businesses often offer personal guarantees to secure loans for their business. Lenders like having more than one person responsible for a loan because it gives them more people to collect from if the borrowers default on the loan.

Instructions

1

Share a personal guarantee of real estate debt by applying for a mortgage loan with a co-applicant. Apply at a bank, credit union, mortgage company or other lender. The real estate will serve as the primary collateral for the loan, but the lender will also hold you and the co-applicant personally responsible for the debt.

2

Apply for an unsecured signature loan with another person. Apply at a bank, credit union or another lender.

3

Co-sign for a loan such as an automobile loan. The primary applicant assumes primary responsibility for the debt, but you will share personal responsibility as the co-signer. The bank will seek full payment from you if the primary borrower defaults on the loan.