For the guaranty drop-down menu, there are three main options based on the lender's business decisions and loan details.
Our documents include one guaranty for all guarantors on a loan as guarantors are jointly and severally guarantors with that document. Most all of our customer's use this guaranty structure. We do not offer a separate guaranty per guarantor via our software output at this time and processing such a request would be a Premium support special instruction. For the guaranty drop-down menu, the three main options are the following:
- Payment - Full repayment guaranty
- Completion - a Lien Free Completion Guaranty with no repayment guaranty.
- Payment and Completion - Combined Full Payment and Lien Free Completion Guaranty
The Completion dynamic in the guaranty templates should be considered by the lender if there are material improvements to be made to the mortgaged property. This correlates mostly with construction and fix and flip deals.
Where the intent of the loan is not true construction/fix and flip, rather the loan is just run-of-the-mill, ordinary improvements required to be completed following the closing of the loan (e.g., adding fresh parking lot asphalt, etc.) are documented in the loan package via a Side Letter, tied to an Earnout, etc., and would likely be completed well before maturity.
All goes to say, the purpose of the completion guaranty option is to address lien free completion of material improvements that may positively alter the value of the property and where completion of those material improvements could take right up until maturity to complete.
Please contact the Customer Support Team for assistance in activating or deactivating one or more of these options.