When a suretyship or guaranty contract is entered into after and separate from the original transaction, there must be new consideration for the promise of the guarantor.

Question

Quizplus · Accepted Answer

The doctrine of past consideration generally does not apply to suretyship or guaranty contracts, meaning that new consideration is necessary for the promise of the guarantor to be valid. This new consideration could come in the form of a fee or some other benefit received by the guarantor in exchange for their promise to guarantee the debt.

When a Suretyship or Guaranty Contract Is Entered into After