Document background
The Personal Guarantee Agreement is a crucial document in Swiss commercial and financial practice, commonly used when additional security is required for loans, leases, or other financial obligations. It finds application in various contexts, from corporate financing to private lending arrangements. Under Swiss law, personal guarantees are strictly regulated by Articles 492-512 of the Swiss Code of Obligations, which impose specific formal requirements, particularly for guarantees provided by individuals. These requirements include written form, explicit amount specification, and notarization for guarantees exceeding CHF 2,000. The document serves to protect both the creditor's interests by providing additional security and the guarantor's interests through clear documentation of the scope and limits of their obligations. Personal Guarantee Agreements are particularly important in business financing, family business arrangements, and situations where corporate entities seek to strengthen their creditworthiness through personal guarantees from directors or shareholders.
