A contract by which one person (the guarantor) agrees to pay another’s debt or to perform another’s obligation only if that other individual or legal entity fails to pay or perform. A guaranty is usually a separate contract from the principal agreement, and therefore the guarantor is secondarily liable to the third person.

See guarantor; surety.

Was this article helpful?

Related Articles

Need Support?

Can't find the answer you're looking for?
Contact Support