Redemption

Phillip Rideout and his family owned several real estate businesses. Phillip was the president and sole shareholder of Rideout Property Corporation. He was a general partner of RI Properties, which owned a home in Connecticut that served as the Rideouts' summer home. He was the only limited partner in RI Investment Group and was the sole shareholder of Rideout Investment Corp., the general partner for RI Investment Group. Each of these entities was a separate legal entity and followed all the required processes for remaining separate $($separate accounting and bank accounts, separate insurance policies and licenses as needed, etc$).$ Rideout Investment Corp. signed a loan document with Customer Bank with Phillip Rideout as a guarantor on the loan. Rideout Investment Corp. defaulted on the loan and Customer Bank sued to foreclose on the property and obtain a judgment for any amount still owed. RI Properties wrote a check to Customer Bank for the balance of the loan, which Customer Bank accepted and deposited.

$1.$ The borrower in this situation is

$2.$ The lender in this situation is

Customer Bank

$.$

$3.$ The guarantor in this situation is

$.$

$4.$ Sometimes there is more than one term that applies to a party. In this scenario, Customer Bank is also referred to as the

debtor

$,$ and Rideout Investment Corp. is also referred to as the

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$.$

$5.$ A guaranty is an agreement that

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be in writing and where a

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promises to

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in the event the

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does not pay.

$6.$ One of the primary differences between a guaranty and surety is that a guarantor has

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liability, whereas a surety has

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liability.

$7.$ Primary liability means the creditor

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need to seek payment from the principal debtor first when the debt becomes due. With a guaranty, the guarantor can be required to pay the obligation only

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the debtor defaults and usually after the creditor has first attempted to collect from the debtor.

$8.$ The terms of the

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determine the guarantor's liability.

$9.$ Borrowers have the right to pay off debt related to real property, including the balance of a loan with interest, to maintain their ownership according to the equitable right of

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$.$

$10.$ In this case, the original borrower

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pay the debt.

$11.$ In this case, the original borrower

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exercise the right of equitable redemption.

$12.$ When a borrower defaults, the guarantor

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of the borrower.

$13.$ In this situation, the guarantor

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pay off the loan amount.

$14.$ In this situation, the guarantor

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exercise the right of equitable redemption.

$15.$ In this situation, the entity that paid off the debt

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the borrower or the guarantor.

$16.$ Because the entity that paid the debt

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the borrower of the guarantor, the entity

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exercise the equitable right of redemption