Serving as a guarantor is a big mitzvah but also a responsibility. We created this section of our website to answer frequently asked questions about our guarantor requirements and process. Please feel free to reach out to us at 604-428-2832 if you have any additional questions, comments or concerns.
A guarantor is someone who agrees to be responsible for the debt of a borrower should they default on their loan payments.
Guarantors play an integral role in supporting our lending model. Most loans are repaid by the loan recipient but guarantors make our loans more secure.
A loan's first guarantor must:
- Be Jewish
- Be a current resident of British Columbia
- Be a Canadian citizen or Permanent Resident
- Be 19 years of age or older
- Show an ability to repay the loan
- Not be a current borrower or guarantor
- Not be married or living with you (exceptions made for parents of dependent students) or the first guarantor
- Not be married or living with another borrower or someone guaranteeing another loan
- Be in good standing with HFLA
A loan's second guarantor must:
- Be a Canadian citizen or Permanent Resident
- Be 19 years of age or older
- Show an ability to repay the loan
- Not be a current borrower or guarantor
- Not be married or living with you (exceptions made for parents of dependent students) or the first guarantor
- Not be married or living with another borrower or someone guaranteeing another loan
- Be in good standing with HFLA
A second guarantor DOES NOT need to be Jewish and can live anywhere in Canada.
There are no specific income requirements but guarantors must have a steady monthly income source that would allow them to comfortably take on the financial responsibility of guaranteeing a loan.
You will be given the choice to complete an online application or have an HFLA board member call you to assess your suitability to serve in this capacity.
If you complete the online application, we will ask you to provide information about your assets, liabilities and income.
If you would prefer to be called, the volunteer will ask you some financial questions to determine if you can afford to take on the debt if the borrower defaults. This will include questions about your assets, liabilities and income. The call usually takes no more than five minutes.
If the loan is approved, the guarantor will be asked to sign a loan guarantee for the full loan amount.
All of our guarantors are jointly and severally responsible for the entirety of each loan.
"Joint and several" is a legal term often used in the context of financial obligations, such as loans or guarantees. It describes a situation where multiple individuals, typically referred to as parties, share a collective responsibility for a particular obligation, such as repaying a loan or fulfilling a contract. However, each party is also individually responsible for the entire obligation.
Here's a more detailed explanation:
Joint Responsibility: In a joint and several arrangement, all parties involved are jointly responsible for fulfilling the obligation. This means that they are collectively liable for the full amount of the debt or obligation. In practical terms, it implies that any of the parties can be held accountable for the entire obligation if the need arises. So, if one party defaults or cannot fulfill their share of the obligation, the others may be required to cover that portion as well.
Several Responsibility: In addition to the joint responsibility, each party also has several or individual responsibility. This means that each party can be held independently liable for the full obligation. If one party is unable to fulfill their share or goes bankrupt, for example, the other party or parties may be legally obligated to cover the entire obligation without the need for proportional sharing.
In the context of an HFLA loan guarantee, when guarantors are jointly and severally responsible, it means that if the borrower defaults on the loan, any one of the guarantors can be held accountable for repaying the entire loan amount, not just their portion of the guarantee.
This provides HFLA with more flexibility and security, as we can pursue repayment from any of the guarantors to ensure the loan is fully paid off.
Guarantors are entitled to full disclosure on the details of the loan, including the loans current balance, the monthly repayment rate and the estimated loan repayment date.
No, you can only serve as a guarantor for one borrower at a time.
No, you cannot be a guarantor and a borrower at the same time. Please contact our office if you are a guarantor in need of a loan so that we can see how we many be able to help you.
No, spouses are considered one financial unit and cannot serve on a loan as a guarantor while their spouse is actively doing so on another one.