Circumstances under which a guarantor would be discharged

Explain the circumstances under which a guarantor may be discharged

Circumstances under which a guarantor would be discharged

  • Payment of the amount due by the debtor or fulfillment of the obligation arising. If the creditors action against the debtor becomes statute bared.
  • If the transaction between the credit and the principal debtor becomes illegal by reason of change of law or otherwise.
  • Revocation of the guarantee by the guarantor.
  • Death of the guarantor.
  • Variation of the term of contract without the guarantors consent.
  • If it is established that the guarantee was obtained by fraud, misrepresentation or concealment of material facts.
  • Failure by the creditor to take steps that was necessary to protect his own interests.
  • Discharge of co-guarantor discharges all.



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