Term of the Day guarantor Person or firm that endorses a three party agreement to guarantee thatpromises made by the first party (the principal) to the second party (client orlender) will be fulfilled, and assumes liability if the principal fails to fulfill them (defaults). In case of a default, the guarantor must compensate the lender or client, and usually acquires an immediate right of action against the principal forpayments made under the guarantee. Learn more about this term Usage Example The student had a difficult time borrowing money because of her lack of credit, so her father agreed to be the guarantor to help secure a bank's loan.

Trivia of the Day Choose the Right Answer: (A) William Bristol  (B) Robert Johnson  (C) Charles Pfizer  (D) George Merck  Original image provided by Erich Ferdinand. Image was altered by adding text. License

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