The Loan Guarantor Agreement is a crucial document in Philippine banking and finance, used when a third party agrees to guarantee the repayment of a loan if the primary borrower defaults. This agreement is particularly common in corporate lending, small business loans, and significant personal loans where additional security is required by the lender. The document must comply with Philippine Civil Code requirements for guaranty contracts and banking regulations, including specific formalities for validity. It typically includes detailed provisions about the scope of the guarantee, enforcement mechanisms, and the guarantor's rights and obligations. The agreement becomes especially important in cases where the primary borrower's creditworthiness alone is insufficient to secure the loan, or when regulatory requirements mandate additional security for certain types of lending transactions.

1. Parties: Identifies the Lender, the Principal Debtor (Borrower), and the Guarantor with their complete legal names and addresses

2. Background: Explains the context of the underlying loan agreement and the requirement for a guarantee

3. Definitions: Defines key terms used throughout the agreement, including 'Guaranteed Obligations', 'Event of Default', and 'Principal Loan Agreement'

4. Guarantee and Indemnity: Core section detailing the scope of the guarantee, including the guarantor's undertaking to pay and perform the guaranteed obligations

5. Nature of Guarantee: Specifies that the guarantee is continuing, irrevocable, and unconditional, and clarifies whether it is a limited or unlimited guarantee

6. Guarantor's Representations and Warranties: Statements by the guarantor about their legal capacity, authority, and financial condition

7. Preservation of Rights: Establishes that the lender's rights against the guarantor are preserved despite any amendments to the principal loan or forbearance

8. Payments: Details how and when payments should be made by the guarantor, including currency and method of payment

9. Costs and Expenses: Allocates responsibility for legal and other costs related to the preparation and enforcement of the guarantee

10. Duration and Release: Specifies when the guarantee will terminate and conditions for the guarantor's release

11. Enforcement: Outlines the circumstances and process for enforcing the guarantee

12. Governing Law and Jurisdiction: Specifies Philippine law as governing law and designates courts for dispute resolution