What is a loan guarantee worth?
Lenders are being warned about the enforceability of loan guarantees following a surprise result in the NSW Supreme Court.
The guarantee a father gave to pay his son’s loan has been upheld but the same guarantee by the mother has been overruled because she did not receive independent advice.
Jon Denovan, partner of law firm Gadens, said lenders must ensure legal advice provided to guarantors is impartial.
Source: Mortgage Business