Standing as a guarantor in Nigeria is often treated as a simple favour.
A friend says, “Just sign for me, nothing will happen.”
A colleague insists, “It’s only a formality.”
But under Nigerian law, guarantorship is not a casual gesture — it is a binding legal contract with serious financial consequences.
Once you sign a guarantee, you may become fully responsible for another person’s debt if they fail to pay. This reality has led to what many Nigerians now call “guarantor wahala” — frozen accounts, salary deductions, seized property, and damaged relationships.
This article explains what guarantorship really means, the legal risks involved, and how to protect yourself.
What Is Guarantorship Under Nigerian Law?
A guarantee is a legal promise made by one person (the guarantor or surety) to answer for the debt or obligation of another person (the principal debtor) in favour of a creditor.
Key features include:
- It is separate from the main loan contract
- The guarantor’s liability is usually equal to the debtor’s liability
- Once default occurs, the guarantor may be treated as the debtor
Guarantors are commonly required for:
- Bank loans
- Cooperative and microfinance facilities
- Employment bonds
- Tenancy agreements
- Business and commercial contracts
Legal Framework Governing Guarantees in Nigeria
Guarantorship is governed by common law principles and statutory rules.
1. Writing Requirement (Statute of Frauds)
A guarantee must generally be:
- In writing, and
- Signed by the guarantor
Oral guarantees are typically unenforceable.
2. Consideration
There must be value given — usually the lender advancing money or granting a benefit to the borrower.
3. Enforceability
Unless the agreement states otherwise:
- The creditor does not need to sue the borrower first
- The guarantor may be sued directly and immediately after default
Nigerian courts have consistently upheld this position.
The Legal Risks of Standing as a Guarantor (“The Wahala”)
Standing as a guarantor can expose you to serious financial and legal consequences.
1. Full Financial Liability
You may be liable for:
- The loan amount
- Interest
- Penalties
- Legal and recovery costs
A small loan can quickly become a large, long-term burden.
2. Garnishee Proceedings
Courts may order:
- Salary or pension deductions
- Freezing and withdrawal from bank accounts
This may happen without prior warning once judgment is entered.
3. Attachment and Sale of Property
Personal assets such as:
- Land
- Houses
- Vehicles
- Investments
may be seized and sold to repay the debt.
4. Credit Blacklisting
Default can affect your:
- BVN-linked credit profile
- Access to loans and mortgages
- Visa applications
- Employment opportunities
5. No Escape Due to Borrower’s Misfortune
Your liability may continue even if the borrower:
- Loses their job
- Disappears
- Becomes bankrupt
- Dies
Unless the guarantee specifically says otherwise.
6. Social and Family Consequences
Beyond money, guarantor disputes often lead to:
- Family conflicts
- Broken friendships
- Financial strain on spouses and children
Position of Nigerian Courts
Nigerian courts have repeatedly held that:
- A guarantor’s obligation is independent of the borrower’s
- The creditor may sue the guarantor alone
- The creditor does not need to exhaust remedies against the borrower first
- Courts will strictly enforce clear guarantee agreements
Defences such as fraud, misrepresentation, or unauthorized changes to loan terms may exist, but they usually require lengthy and expensive litigation.
Real-Life Experiences: The Rise of “Guarantor Wahala”
Across platforms like X, Facebook, and WhatsApp, many Nigerians share similar stories:
- Losing family homes over loans they never collected
- Salary deductions for friends who disappeared
- Pressure from banks and recovery agents
- Signing documents without understanding the consequences
The lesson is consistent: guarantorship is risky when taken lightly.
Legal Protections Available to Guarantors
Some legal rights exist, including:
- Indemnity – recovering money from the borrower after paying
- Subrogation – stepping into the creditor’s legal position
- Discharge if terms are altered without consent
- Revocation of continuing guarantees for future transactions
However, these remedies often require court action and may be useless if the borrower has no assets.
Practical Advice Before You Sign
To avoid guarantor wahala:
- Say no if you are uncomfortable
- Read every clause carefully
- Insist on limits (amount, time, purpose)
- Monitor repayments
- Seek independent legal advice
- Never guarantee what you cannot afford to repay
Conclusion
Guarantorship in Nigeria is not a mere favour or formality — it is a serious legal commitment that can threaten your financial stability and peace of mind for years.
Many guarantor problems are preventable with proper awareness.
One signature can change your life. Think carefully before you sign.