Non-Recourse Guarantee

Generally used in connection with real estate loans whereby the borrower is guaranteeing repayment only to the extent of the value of the real estate or other collateral pledged as security for the loan. In other words the lender’s sole recourse in the event of a default is to liquidate the collateral. An Unlimited Guarantee or Recourse Guarantee permits the lender to seek repayment from the guarantors either before or after the collateral is liquidated, (depending upon the terms of the guarantee and the laws of the applicable jurisdiction).