A guarantor is the entity or individual legally responsible for lease payments if the tenant defaults.
A guarantor adds a second source of repayment behind the tenant, and the quality of the guarantor can matter as much as the tenant. Guarantees differ: some are full and unconditional for the entire term, while others burn off over time or are capped. Buyers should review the guaranty document, confirm the guarantor's financials, and check that the guaranty transfers with the sale of the property. A strong brand does not automatically mean a strong guarantor.