All About Guaranteed Loan You Should Know
Guaranteed loans are loans issued by the lender in accordance with the guarantee provided by the Third Party Guarantee Act that undertakes joint and several liability in accordance with the provisions if the borrower is unable to repay the principal and interest of the loan. The loan guarantee for the loan is an irrevocable guarantee of full joint and several liability, i.e. the principal and interest of the loan stipulated in the loan agreement and the related expenses incurred by the loan contract. The guarantor must also assume all civil and joint liabilities arising from the loan agreement.
Guaranteed range of loan coverage
1、must be approved by the Industry and Trade Registration Administrative Service, and in accordance with the tax registration and annual inspection procedures of companies and corporations;
2、the product has a market, production and exploitation has advantages, not clutter the misappropriation of credit funds, respect the credit;
3、having the ability to repay debt and interest on time, principal of the initial maturity loan and interest and maturity loans have been repaid;
4、opened a basic account or general deposit account in our bank;
5、the borrower's operating and financial system is sound, the main economic and financial indicators meet the bank's requirements;
6、The proposed medium- and long-term loan application must be approved by the relevant State Department, and the equity share of the legal entity that owns the new project with the total investment of the project must not be less than the capital share of the investment project stipulated by the State.
The question of the responsibility of the loan guarantor
Because the guarantor of the general guarantee bears the legal responsibility for unilaterality and probono, the guarantor has done his duty to the guarantor and the creditor fails to exercise his rights, and the guarantor should be exempt from the responsibility of the guarantee within a certain period of time. In other words, if the guarantor provides the commercial bank with the actual situation of the property available for execution after the expiry of the loan agreement, the guarantor may ask the court to waive the guaranteed liability for the actual value of the property provided by the loan.
The basis of the guarantee of survival is the guarantor's confidence in the debtor, so that in the event of a change in the debtor, the guarantor will generally cease to assume the burden of the business, and the guarantor is not responsible for the obligation if the loan contract changes and the guarantor does not obtain the written consent of the guarantor. This is specified in section 24 of the Security Act. However, certain provisions of the interpretation of security law have violated this jurisprudence, as shown by the following question: during the guarantee period, the creditor and the debtor have changed the quantity, price, currency and interest rate of the principal contract without the consent of the guarantor, if the debtor's debt is reduced, the guarantor should always assume the guarantee of the amended contract; If the guarantee period is the period provided in the original contract or prescribed by law, the guarantor still assumes responsibility for the guarantee if the creditor and the debtor agree to change the content of the main contract but do not execute it in practice. This shows that the guarantee of the security of the claims has become the main focus of the security law, and the guarantor is responsible for the obligation to guarantee his commitment, whether or not the content of the contract has been changed.
In the lending activities of commercial banks and borrowers, agreements are often made in the case of new loans to repay old loans. In this activity, does the guarantor also bear responsibility for the guarantee? On the basis of the main change of content of the contract, the guarantor is no longer responsible for the principle, the new repayment of the loan of the old loan belongs to the modification of the main contract, the guarantor in addition to the modification agreement know and should know, do not bear civil liability, but if the former guarantor of the loan is insured for the new loan , then the guarantor's liability cannot be exempted.
In the bankruptcy of the business, the largest creditor of the bankrupt company is the financial institutions, including commercial banks, although banks to prevent financial risks, usually use secured loans, but in the loan guarantee, commercial banks know or should know that the bankruptcy of the borrower, if not the timely declaration of claims and inform the guarantor , then the guarantor will be in bankruptcy proceedings can be compensated as part of the guarantee exemption , the bank cannot recover from the guarantor, can not bear their own bad debts.
