A guaranty is an undertaking on the part of one person (the guarantor) that is collateral to an obligation of another person (the debtor or obligor), and which binds the guarantor to performance of the obligation in the event of default by the debtor or obligor.
The contract of guaranty may be absolute or it may be conditional. An absolute guaranty is a contract by which the guarantor has promised that if the debtor does not perform the obligation or obligations, the guarantor will perform some act (such as the payment of money) to or for the benefit of the creditor.
A line of credit is an arrangement in which a lender extends a specified amount of credit to borrower for a specified time period.
Rhode Island Absolute Guaranty of Payment in Consideration of Extension of a Line of Credit is a legal document that serves as a form of security when extending a line of credit. It provides a guarantee to the lender that the borrower will make all payments required under the line of credit. Keywords: Rhode Island, Absolute Guaranty of Payment, Extension of a Line of Credit, legal document, security, lender, borrower, payments. There are different types of Rhode Island Absolute Guaranty of Payment in Consideration of Extension of a Line of Credit, and they include: 1. Absolute Guaranty of Payment with Personal Guarantee: This type of guaranty involves a personal guarantee by an individual who is willing to take responsibility for the line of credit payments if the borrower defaults. The personal guarantor's assets can be claimed by the lender in case of non-payment. 2. Absolute Guaranty of Payment with Corporate Guarantee: In this form, a corporation guarantees the line of credit payments on behalf of the borrower. The corporation assumes the responsibility for making payments if the borrower fails to do so. 3. Absolute Guaranty of Payment with Joint and Several liabilities: This type of guaranty holds multiple individuals accountable for the line of credit payments. Each individual becomes jointly and severally liable, meaning they can be held individually responsible for the full amount of the debt if others fail to fulfill their obligations. 4. Absolute Guaranty of Payment with Limited Liability: This type of guaranty restricts the guarantor's liability to a specific maximum amount. The guarantor's responsibility is limited to this predetermined sum, shielding them from excessive liability. 5. Absolute Guaranty of Payment with Collateral: In this form, the guarantor pledges specific assets or collateral to secure the line of credit. If the borrower defaults, the lender can seize and sell the collateral to satisfy the debt. It is crucial to consult with legal professionals when considering Rhode Island Absolute Guaranty of Payment in Consideration of Extension of a Line of Credit, as there may be specific requirements and regulations that vary depending on the circumstances.
