guarantor
Also called: pemberi jaminan
A person who bears repayment of another family member's debt if the borrower fails to pay.
What it means
A guarantor is a person willing to bear another party's obligation if that party fails to meet it. In families, someone is often asked to be the guarantor for a sibling's or relative's loan. The role is not merely a formality, because the guarantor can be billed directly by the lender.
Why it matters for families
Being a guarantor means your own financial capacity is also at stake. If the borrower fails to pay, the guarantor must settle it from their own money, and this can drain family savings. The decision to become a guarantor should be made after knowing the remaining debt and the borrower's ability to pay.
Example
An older sibling is asked to be the guarantor for their younger sibling's business loan. They ask to see the installment plan and set aside their own reserve fund. When the younger sibling's business has a slow month, they already know where the temporary repayment money will come from.
Common misunderstanding
It is often assumed a guarantor is just a signature with no consequences. In fact, a guarantor has an obligation to pay if the borrower fails.