Liability of a guaranter in case of home loan

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One of my friend has applied for home laon from Indiabulls Housing Finance and asks me to be guaranter. I want to know the liability on my part and the extent of liability. The builder from whome he is buying the property is saying that it's just a formality and there will be no liability on me since in case of any default made by the borrower the bank will recover the whole amount by disposing the said home against which the loan is granted. Also the relevent details are as under;-

Loan amount - 10.5L

Cost of property - 14.5L

Term of loan - 20Year.

Request you to pls share the details of liability like quantum, nature and any other part necessary to know.

Replies (1)

The builder suggestion to some extent is correct. Actually, as per the loan contract, the guarantor is equally responsible for paying off the loan. Thus the liabilities of the guarantor are similar to that of the borrower. Banks seek guarantors for various types of loans.

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