So you or someone you know has been asked to act as guarantor to help someone secure a loan. What this means is you’re being asked to be a form of security for the bank in case the borrower is unable to repay the loan.
Because being a guarantor may impact your own money or assets, you’re required to seek independent legal advice and a solicitor’s certificate of legal advice before signing the bank papers.
Mountains Lawyers have been providing guarantor advice for many years, whether it be for bank guarantee, family guarantee, parental guarantee or personal guarantee, and when a guarantor is required to present evidence that an independent solicitor has provided them with legal Advice concerning a bank guarantee.
What do I need to know about being a guarantor?
You may be required to personally guarantee the obligations of the borrow for repayment of loan and interest. You’ll be required to sign a guarantee and indemnity.
You may also be required to provide additional security by allowing the bank to register an interest (usually a mortgage or second mortgage) on the certificate of title of the property.
As a guarantee, you may be unlimited or limited to a certain sum.
The bank will send you a separate loan pack to that of the borrower. As these documents are ordinarily issued by regular mail from the Eastern States, it’s better to wait until you have received the loan documents before scheduling an appointment with a solicitor. Your solicitor is unable to provide the legal advice without the loan documents to review.
It’s also important to check the loan and guarantee documents to make sure the documents match your understanding of your liability.
How long will the appointment take?
You’ll need to allow 1 to 1 and ½ hours for your appointment.
Mountains Lawyers will review the loan documents and the terms and conditions to ensure you understand all the legal implications of providing the guarantee. We also need to be satisfied that you’re not being coerced by the borrower or any other person into signing the guarantee.
What do I bring to my appointment?
Bring all the documents provided by the financial institution along with the relevant original ID to satisfy our 100 point identification check.
What if I have already done an identity verification process with the financial institution?
A solicitor must always ensure they have properly identified anyone to whom they are providing legal advice. The bank will also require that the solicitor conducts a separate verification of identification whenever land registration documents are being signed.
What identifications do I need to satisfy the 100 points?
All identifications are listed on our 100-Point Identity Checklist. They must be valid and not expired
Scheduling the appointment
At Mountains Lawyers, we understand that sometimes you don’t receive your bank documents until a few days before settlement is due. In such circumstances, we’ll endeavour to schedule an urgent appointment to ensure the settlement isn’t delayed. However, it’s important to schedule the appointment as soon as you have the documents so we can avoid any last minute rush.
Call Mountains Lawyers on 9592 7326 today to book an appointment.