Personal Guarantee Review: What You Are Really Signing
When you sign a personal guarantee in a commercial contract, you are agreeing that if your business cannot pay, you will — from your personal savings, home equity, and other assets. On a 5-year commercial contract at $5,000/month, an unlimited personal guarantee creates up to $300,000 in personal liability. Yet most business owners sign without understanding the scope of what they are accepting or what limitations can be negotiated. Employment Contract Review reviews every personal guarantee provision in commercial contracts, quantifying your total exposure and identifying every term that can be improved before you sign.
Drop your contract to analyze it
PDF, DOCX, or DOC · Results in 60 seconds
or drag & drop your file here
Why Use Employment Contract Review?
Total Liability Quantification
We calculate your maximum personal liability under the guarantee as written — base rent only vs. all contract obligations including CAM, operating expenses, legal fees, holdover rent, and buildout costs — and present the number in clear dollar terms.
Guarantee Duration Analysis
We determine whether the guarantee runs for the full remaining contract term, a fixed number of months, or terminates upon specific conditions like a "good guy" provision — and explain what each structure means for your personal risk.
Good Guy Clause Identification
A "good guy guarantee" terminates personal liability when you vacate and provide required notice — dramatically limiting your downside by eliminating liability for the remaining contract term. We identify whether your contract includes this critical protection.
Burn-Down Provision Review
Some guarantees reduce guaranteed liability over time as you fulfill contract obligations — called burn-down or burn-off provisions. We identify these favorable structures and explain how much they reduce your exposure year by year.
Co-Guarantor Structure Analysis
When multiple founders or owners sign a contract, personal guarantees can be joint and several (each person liable for 100% of obligations) or several (each liable only for their proportionate share). We identify which structure your contract uses and what it means for each signer.
Enforcement Trigger Review
Some guarantees activate only upon specific conditions — business insolvency filing, default and notice, or expiration of a cure period. We identify any conditions that limit when the landlord can enforce the guarantee against you personally.
What Your AI contract Review Looks Like
Here's a preview of the kind of analysis Employment Contract Review provides for this type of contract.
Risk Score
Flagged Issues
A personal guarantee that exposes you to every remaining month of rent if the business fails — on a 5-year contract at $8,000/month, that is up to $480,000 in personal liability with no mitigation. This is the most dangerous standard guarantee structure.
Guarantees that extend beyond base rent to cover all contract obligations: CAM charges, operating expenses, repair costs, legal fees, court costs, broker commissions, and holdover rent — dramatically increasing total exposure beyond the rent figure alone.
When multiple business owners each sign joint and several personal guarantees, the landlord can pursue any single guarantor for the full amount owed — meaning one partner could be on the hook for obligations they did not personally cause, even if others have assets to pay.
Personal guarantees that remain in force even after you have sold the business or assigned the contract to a new tenant — maintaining personal liability for a business you no longer own or operate.
Guarantees allowing the landlord to enforce personal liability immediately upon default, without first providing notice and a reasonable cure period — preventing you from stepping in to resolve a business cash flow issue before personal assets are at risk.
Landlords sometimes require spouses or domestic partners to co-sign personal guarantees specifically to reach marital assets or community property — creating personal liability for a non-business-owner who had no role in the contract decision.
Disclaimer: Employment Contract Review provides AI-powered informational analysis and is not a law firm and does not provide legal advice.
Frequently Asked Questions
Ready to Review Your contract?
Drop your contract below — get a free AI risk report in under 60 seconds.
Drop your contract here
PDF, DOCX, DOC · Free preview · $19 full report
Employment Contract Review provides AI-powered informational analysis and is not a law firm and does not provide legal advice.