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In a finance or lending context, a guarantor would be forced to answer for the debt or default of the debtor to the creditor, if a debtor does not fulfill an obligation on their part to repay their debt.
A form of guaranty whereby a parent, as guarantor, assumes the responsibility for the payment or performance of an action or obligation of its subsidiary by agreeing to compensate the beneficiary in the event of such non-payment or performance.
In theory, your parents are potentially liable for the life of the loan but once you have built up 20% equity in your own property, you can apply to the bank to have your parents released as guarantors and everyone then lives happily ever after.
Parent company guarantee The advantage of a PCG is that they are generally provided at no cost (although sometimes there may be inter-company charges) and the parent company under the PCG may be liable to the same extent as the contractor is liable to the employer.
Parent Company Guarantee is a written undertaking by Contractors ultimate parent to Client, guaranteeing performance and undertaking to complete obligations under the Contract in the event of default in Contractor's performance (a subsidiary of such parent).