Personal guarantee of the manager: what you are committing to and where the limits are

Acting as guarantor for your company means promising the bank to pay the company's debt if it defaults. Your personal assets are liable for this debt, up to the maximum amount specified in the agreement. The law sets limits: a required form, proportionality to your income and assets, and information the bank must provide.

This page outlines the principles. It does not provide a standard wording for the handwritten statement, does not quote any legal articles in full, and does not address case law. It is not a substitute for reading your document. The official sources are from different dates (2020, 2023, and September 2026): a specific point should be verified before signing.

What you sign

A guarantee is a contract by which a person, the guarantor, undertakes to pay the money owed to a creditor (service-public.fr). It can cover one or more debts, whether existing or future.

Three principles to remember:

• Commitment is secondary. It depends on the company's debt and cannot exceed it (service-public.fr, Bpifrance Création).
• The act sets a maximum amount. According to Bpifrance Création, it is expressed as principal, interest, fees and accessories included.
• It can be handwritten or in electronic format. (service-public.fr).

Simple, supportive, real: what's changing for you

Bpifrance Création specifies that guarantees frequently take the form of joint and several liability, and the DGCCRF fact sheet (2020) indicates that this is the most common form used by financial institutions. Therefore, check for the term "joint and several liability" in your agreement. According to service-public.fr, in a commercial guarantee, the guarantor is automatically joint and several: joint and several liability can therefore also arise from the commercial nature of the commitment.

Bpifrance Création also advises verifying that it is indeed a guarantee, and not an independent, on-demand commitment separate from the contract with the bank. The difference is significant: the funds are payable even if the company disputes them.

The formalities imposed on the bank and on you

• The handwritten note. The guarantor, if an individual, must add by hand a statement indicating their commitment as guarantor (service-public.fr, 2023). According to the DGCCRF (2020) fact sheet, they must sign the document themselves and ensure that the amount is written in both words and figures. The three sources do not word this statement in the same way: do not copy a template found online and have the document proofread.
• Exemptions. The handwritten statement is not mandatory for a document drawn up by a notary or a lawyer, nor for a guarantee from a legal entity (service-public.fr).
• Free and informed consent. Otherwise, the commitment can be cancelled. According to service-public.fr, it must not involve an unemancipated minor or a protected adult: an act concluded without capacity is considered null and void.
• The warning. According to service-public.fr, a professional creditor must warn a personal guarantor when the debtor lacks the financial means to fulfill their obligation. Otherwise, the creditor cannot claim against the guarantor for the amounts corresponding to the losses they have suffered.
• Annual information. Before March 31 of each year, the creditor must inform the guarantor of the amount due as of the preceding December 31 and the end date of the guarantee (service-public.fr, DGCCRF). Otherwise, the interest and penalties in question are not covered by the guarantee (service-public.fr).
• Information at the first incident. The creditor must inform the guarantor as soon as the principal debtor makes the first unpaid installment during the month in which the payment was due (service-public.fr). Otherwise, the guarantor is no longer liable for accrued interest and penalties (service-public.fr).

Another useful point: the guarantee cannot be called upon before the debt is due (service-public.fr).

Proportionality: a real limit, with a precise scope

If the guarantee is manifestly disproportionate to the income and assets of the guarantor at the time of signing, it is not cancelled: the amount is reduced to that for which the guarantor could actually commit at the time of signing the guarantee (service-public.fr, Bpifrance Création).

The example from service-public.fr: a person has total assets of €500,000 and is asked to guarantee a debt of €2,000,000. The debt represents four times their assets. The sources consulted do not provide any ratio at which a guarantee would be considered disproportionate. The assessment depends on your specific case.

The spouse and the matrimonial property regime

Under a community property regime, a spouse cannot pledge community property as a guarantee without the express consent of their spouse (Bpifrance Création, citing Article 1415 of the French Civil Code). Without this consent, only the guarantor's separate property and personal income are liable.

Two clarifications from the same page:

• A divorce does not, in itself, terminate the guarantee; ;
• In the event of separation, the judge may place the sole burden of debts on the spouse who retains the professional assets, regardless of the matrimonial regime.

The spouse who is a partner, collaborator or employee has their own page.

The duration and the exit

The same page warns that the termination of the guarantee by the manager risks the withdrawal of the bank's support. In the event of the guarantor's death, their heirs remain liable for debts incurred before the death, but not for those incurred afterward (service-public.fr).

What you can ask the bank

Bpifrance Création indicates three possible clauses in the agreement:

• for a partner, specify that their status as a partner is a cause or condition of their commitment; ;
• for a manager, linking the commitment to the duration of their duties; ;
• stipulate that the bank notify the guarantor of changes in the company's solvency.

The page also mentions other forms of security (pledge, pledge on stocks, pledge of securities, mortgage on real estate), the involvement of an organization that covers part of the amount borrowed, and other financing, including the shareholder's current account and the capital increase.

If the deposit is called

The guarantor who has paid has recourse against the principal debtor. They must notify the debtor beforehand of their intention to pay (service-public.fr). According to Bpifrance Création, individual guarantors can appeal to the debt mediation commission.

From a tax perspective, Bpifrance Création indicates that the amounts paid can be deducted under certain conditions, notably that the commitment does not exceed three times the remuneration received or expected at the time of subscription. It refers to the BOFiP (Official Tax Bulletin).

The BOFiP (version of 26/06/2023) treats this deduction as part of wages and salaries when the employee intends to maintain their salary. It also sets out other conditions: an option for actual expenses, without combining it with the standard deduction, and a commitment made in the interest of the business. The tax documentation reviewed therefore applies to salaried managers. If you are not an employee of the company, the page does not specify whether this rule applies to you: verify this point before signing.

Numerical example (fictitious profile)

Situation. Nadia runs a limited liability company (SARL). The bank is financing €200,000 and requires her to provide a joint and several guarantee, with a limit of €260,000 stipulated in the loan agreement (principal, interest, fees, and related expenses). Nadia declares €150,000 in assets and €48,000 in annual income. She is married under a community property regime. Her spouse has not given their express consent (assumptions of the hypothetical situation).

Issue. Consider the implications before signing.

Strategy. She notes the maximum amount of the transaction, compares it to her assets and income, verifies the joint liability clause and the consent of her spouse.

Result. The ceiling exceeds the €60,000 loan, or 30% of the principal. The maximum exposure is €260,000, This represents 1.73 times the declared assets (173 %) and 5.42 times the annual income. In the example from service-public.fr, the ratio is 4 times. These ratios do not indicate whether the commitment is disproportionate; only an assessment of the entire case can determine that. Without the express consent of the spouse, community property is not at risk; only Nadia's separate property and personal income are.

This profile is fictitious. The amounts illustrate the calculation. They do not reflect your individual situation.

What changes depending on your situation

• The form of the commitment simple, supportive, real or autonomous.
• The maximum amount stated in the deed, and its place in your assets and income.
• Your matrimonial property regime and the consent of your spouse.
• The duration of the commitment, determined or not.
• The civil or commercial nature of the commitment According to service-public.fr, in a commercial guarantee, the guarantor is automatically jointly and severally liable, and the commercial court has jurisdiction in the event of a dispute. The page does not detail the conditions for this classification.

The rule depends on your situation. No results are guaranteed.