Personal Guarantee and Certificate

Everything you need to know about getting a Personal Guarantee Certificate over Goodlawyer.

  1. What is a Personal Guarantee and Certificate?
  2. Pricing and Scope
  3. What is the Process?
  4. Why does my business need these documents?
  5. Frequently Asked Questions
  6. Book your Personal Guarantee and Certificate


What is a Personal Guarantee and Certificate?

Some financial lenders require a Personal Guarantee and a Guarantees Acknowledgment Act Certificate (or other form of witness) to protect them and expand their options for collection. A common example would be a founder personally guaranteeing a loan made to their business corporation.

The Certificate (or other form of witness) must be produced by a lawyer to accompany the signed Personal Guarantee. This means having a lawyer review the guarantee with the guarantor to ensure their understanding, then having the lawyer witness the signing of the document, which can now be done over a video call.


Pricing and Scope

$150 + Tax

  • $125 Legal fee
  • $25 Service fee
  • This price is based on a basic Personal Guarantee Certificate and is subject to additional fees if your matter is more complex. Your lawyer will always clarify any additional costs for your approval


  • Project kick-off call to gather information, advise you, and answer questions
  • One custom Personal Guarantee
  • One round of minor revisions

Not Included

  • Review of any agreements or other business documents
  • Completing any legal research or providing a formal written legal opinion
  • Additional work or questions following the call
  • Negotiating on behalf of any guarantor, debtor, or lender 

Your lawyer may recommend additional services on or after your call. Your approval for any additional work is always required and you will never be billed for services you didn't agree to.

Why use a Personal Guarantee?

Better access to capital.

Giving lenders a personal guarantee can make it easier to access working capital like financing or necessary equipment on loan. Give them the extra assurance they need to know their investment is in safe hands.

Set limits on your liability.

Clearly define the limits of your liability in your Personal Guarantee so that if your debtor defaults, you’re still left with a roof over your head and not out in the cold. 


What is the process?

  1. Book a call. Pick a time to kick-off the project and discuss your Personal Guarantee with a Good Lawyer.
  2. Design your Guarantee. Your lawyer will collect all the necessary information to draft your Personal Guarantee.
  3. Revise the document. You might have to negotiate with your lenders or debtors. The first instance of the agreement is often not the final document, especially if other parties are exercising their right to seek independent legal advice.
  4. Finalize your Guarantee. Once all the negotiations are settled, you’ll get one round of revisions before your lawyer finalizes and sends you a digital copy of your new Personal Guarantee ready to sign.


Frequently Asked Questions

What’s the difference between a Personal and Corporate Guarantee?

They’re basically the same thing except the liability is passed on to a corporation instead of an individual person. A Personal Guarantee makes an individual liable for another individual’s or corporation's debts, whereas a Corporate Guarantee allows a corporation to take the liability as the guarantor for another corporation or individual.

Can I limit my personal liability?

Yes. Although a Personal Guarantee makes you responsible for the debt, you can limit your guarantee to a certain financial amount. Some lenders might have formulas for calculating limits, and others might not allow limits at all. Every situation is different so discuss it with your lawyer if you think it might apply to your Personal Guarantee.

What happens if the debtor defaults?

The terms of your Personal Guarantee will be unique to your situation, but several things could happen when the debtor defaults. First, your credit could be negatively impacted which could affect your ability to secure financing later. Second but not always, the seizure of any collateral or deposits by the lender. Finally, You will have to repay any outstanding debts to the lender, plus any late fees, interests, and other penalties as outlined in the terms of the loan and/or guarantee.

What happens if I default on my guarantee?

If your debtor defaults, and then you default too, your lender will likely take legal action against you. The lender can sue the guarantor and will have a good chance of claiming your personal assets. Depending on the clauses in your Guarantee, you might even need the lender’s permission before selling any of your personal assets throughout the guarantee. Needless to say, it’s not a good situation so don’t sign a Personal Guarantee if you think there’s a high chance of you or the debtor defaulting.

Is the Personal Guarantee legally binding?

Yes, absolutely. So long as the document has been properly drafted and does not include and clauses that invalidate it, your Personal Guarantee is a legally binding document. Getting a good lawyer to explain and draft your Personal Guarantee is highly recommended.

Who should sign a Personal Guarantee?

It is extremely rare that anyone other than members of an executive management team sign a Guarantee for a company or individual. If you do not have a clear picture of the company or individual’s plans and finances, then do NOT sign a Personal Guarantee. Of course, every situation is different and there are exceptions so make sure you discuss it with your lawyer if you have doubts.

Do I need a lawyer in my province?

For most business law questions the answer is “no”. For employment and commercial tenancy-related issues, it’s best to speak to a lawyer who has experience in your province. Goodlawyer has lawyers all over Canada with diverse experiences and specializations. If your lawyer doesn’t think they can answer your question due to a provincial issue, Goodlawyer will find another Good Lawyer who can help you. 


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Taran, June 2020, 5-Star Google Review


Start your new partnership on the right foot.

Book a Personal Guarantee and Certificate 


Your lawyer will assess your situation and make sure this is the correct service for your needs.

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