An accommodation party may sign an instrument guaranteeing collection rather than payment of an instrument.In this situation,the accommodation party is ________ liable on the instrument.
A) primarily
B) secondarily
C) unconditionally
D) never
E) exclusively

Question

Quizplus · Accepted Answer

An accommodation party who guarantees collection rather than payment is secondarily liable on the instrument. This means that they are responsible for payment only if the original party cannot pay. The accommodation party is not unconditionally liable and they are not exclusively liable, as there are other parties who can also be responsible for payment. However, the accommodation party is still liable and can be held responsible for payment if the original party defaults.

An Accommodation Party May Sign an Instrument Guaranteeing Collection Rather