Henkilötakaus

Henkilötakaus, or personal guarantee, is a legal arrangement where an individual (the guarantor) commits to fulfilling the financial obligations of another party (the principal debtor) if the principal debtor fails to do so. This typically applies to loans, rent payments, or other contractual debts. The guarantor essentially becomes secondarily liable for the debt.

In Finland, a personal guarantee must be documented in writing and signed by the guarantor. It is crucial for the guarantor to understand the full scope of their commitment, including the amount of the debt, the repayment terms, and the circumstances under which the guarantee will be invoked. Without a clear written agreement, a personal guarantee may not be legally enforceable.

The guarantor's liability is usually triggered when the principal debtor defaults on their payments. The creditor can then pursue the guarantor for the outstanding amount. This can have significant financial consequences for the guarantor, potentially affecting their personal assets. It is therefore advisable for anyone considering providing a personal guarantee to seek independent legal or financial advice to fully assess the risks involved. The guarantor's obligation can also cease under specific conditions, such as if the debt is fully repaid or if the creditor releases the guarantor from their obligation.