---
kind: "section"
citation: "13 C.F.R. § 107.820"
title: "13"
number: "107.820"
heading: "Financings in the form of guarantees."
url: "https://uscodex.org/cfr/13/107.820"
---

# §107.820. Financings in the form of guarantees.


At the request of a Small Business or where necessary to protect your existing investment, you may guarantee the monetary obligation of a Small Business to any non-Associate creditor.

- (a) You may not issue a guaranty if:
  - (1) You would become subject to State regulation as an insurance, guaranty or surety business;
  - (2) The amount of the guaranty plus any direct Financings to the Small Business exceed the overline limitations of [§ 107.740](/cfr/13/107.740.md), except that a pledge of the Equity Securities of the issuer or a subordination of your lien or creditor position does not count toward your overline; or
  - (3) The total financing cost to the Small Business exceeds the cost of money limits of [§ 107.855](/cfr/13/107.855.md).
- (b) **Pledge of Licensee's assets as guaranty.** For purposes of this section, a guaranty with recourse only to specific asset(s) you have pledged is equal to the fair market value of such asset(s) or the amount of the debt guaranteed, whichever is less.

## Notes

### Authority

Authority: 15 U.S.C. 662, 681-687, 687b-h, 687k-m.

### Source

Source: 61 FR 3189, Jan. 31, 1996, unless otherwise noted.