When drafting a commercial lease, it is important for landlords to include a personal guaranty provision because it protects the landlord in the event the tenant stops paying rent.
Limited/ Good Guy Guaranty
- A limited personal guaranty is a lease provision that only holds the guarantor liable for the rent obligations under the lease up until a certain time period. A good guy guaranty is a type of limited personal guaranty that only holds the guarantor liable until the date the tenant surrenders the leased property, instead of being liable for the entire lease period. Such a guaranty serves to protect landlords from costly litigation against non-paying tenants because it motivates non-paying tenants to vacate the premises immediately in order to avoid being personally liable for any additional rent payments.
- An unlimited personal guaranty makes the guarantor, usually the business owner, personally liable for any lease payments that the business fails to pay.
James G. Dibbini & Associates, P.C. have over 20 years of experience drafting and negotiating commercial and residential leases. We can draft and negotiate a lease that will protect you and your property if a problem arises. Call us today at (914) 965-1011 to get started in obtaining assistance with your new tenancy.