Bank wants my LP to be a Guarantor

[Jon Fletcher]

I've put together a real estate deal where my LP will be contributing 80% of the equity. They're doing the deal because it's a great investment and I'm doing all of the legwork. The problem I'm running into is that every lender is insisting that any person with more than 10% ownership be a guarantor. Are there creative workarounds for this? I know on very large-scale development deals, GP's guarantee the loan all the time without the LP. 

[Alexander Felice]

former banker here

10% is, in my experience, a low barrier, however it's extremely common to ask for a guarantee from everyone who owns more than 20% of any loan. 

way around this - find a non-recourse loan