Which of the following is true of a guarantor in a guaranty arrangement?

Question

Quizplus · Accepted Answer

In a guaranty arrangement, the guarantor is secondarily liable for the debt of the principal debtor. This means that the creditor will first seek repayment from the principal debtor and only approach the guarantor if the debtor defaults on the debt. Therefore, option A is the correct answer. Option B is incorrect because the guarantor cannot be approached unless the principal debtor is in default. Option C is also incorrect because the creditor will first seek repayment from the principal debtor. Option D is unrelated to guaranty arrangements and is therefore incorrect.

Which of the Following Is True of a Guarantor in a Guaranty