From a lender's perspective, it is important to draft a guarantee which is limited by amount as a guarantee of all of the loan, with a cap on liability. You should not draft the guarantee as a guarantee of part of the loan. For example, in the context of a loan for £50,000,000 which is to be made by a lender to a borrower under a facility agreement, you should draft a guarantee which is to be limited to say, £40,000,000, as follows: 'the guarantor irrevocably and unconditionally guarantees all of the borrower’s obligations to the lender under the facility agreement provided that the guarantor's liability under this guarantee is limited to an amount of £40,000,000' You shouldn't draft the guarantee as follows: 'the guarantor irrevocably and unconditionally guarantees a sum of £40,000,000 in respect of the borrower’s obligations to the lender under the facility agreement' Why you shouldn't draft the guarantee to cover