A personal guarantee is a written promise from a guarantor (typically the business owner) that in the event of a breach of any lease terms, the guarantor will personally pay the financial obligation of the lease. This most commonly occurs when a business fails to pay rent, and the guarantor is obligated to pay personally instead. Personal guarantees are standard terms in most real estate leases. Remember that most Landlords are unwilling to lease space to companies with few assets they can collect in the event of default; by the time the Landlord pursues that tenant legally, the company is often out of business with zero cash or valuable assets. On the other hand, personally collecting from the guarantor is usually successful, especially when the guarantor has assets such as bank accounts, a home, rental property, or an investment portfolio. Personal guarantees give Landlords enough fallback position to sign leases with smaller tenants.