Code of Federal Regulations Title 7. Agriculture § 7.4279.132 Personal and corporate guarantees

(a) Full, unconditional personal and/or corporate guarantees for the full term of the loan are required from those owning 20 percent or more interest in the borrower, where legally permissible, unless the Agency grants an exception. The Agency may grant an exception for existing businesses only when the lender requests it and documents to the Agency's satisfaction that collateral, equity, cash flow and profitability indicate an above-average ability to repay the loan. Partial guarantees for the full term of the loan at least equal to each owner's percentage of interest in the borrower times the loan amount may be required in lieu of full, unconditional guarantees when the guarantors' percentages equal 100 percent so that the loan is fully guaranteed.

(b) When warranted by an Agency assessment of potential financial risk, the Agency may require the following:

(c)All personal and corporate guarantors must execute Form RD 4279–14, “Unconditional Guarantee,” and any guarantee form required by the lender.The Agency will retain the original, executed Form RD 4279–14.