[Direct answer]In the Beijing area, when repaying old loans with new loans, whether the guarantor is liable depends on whether they are aware of the situation and whether the guarantors of the old and new loans are the same. Article 16 of the Interpretation of the Supreme People's Court on the Application of the Guarantee System of the Civil Code of the People's Republic of China (effective from January 1, 2021) stipulates that, unless the guarantor knows or should have known about the agreement between the parties to the main contract to repay old loans with new loans, the guarantor shall not bear civil liability; where the guarantors of the new and old loans are the same, the people's court shall determine that the guarantor of the new loan shall bear the guarantee responsibility. Accordingly, if the guarantor is unaware of the repayment of old loans with new loans and is not the same guarantor, they can usually be exempted from liability; if they know or should have known about it, or if the same person guarantees both the old and new loans, they will still need to bear the guarantee responsibility. In practice, if the creditor claims that the guarantor is aware of the situation, the creditor should bear the corresponding burden of proof, so the guarantor should pay attention to keeping records of the signing and communication.

I. Problem background and typical scenarios

It is quite common in finance and private lending for borrowers to use new loans to repay old ones, and guarantors are often unaware of this. Typical scenarios include: when the borrower is unable to repay the loan on time, the lender signs a new loan contract with them to repay the old loan, but the guarantor is kept in the dark; when the new and old loans are guaranteed by the same guarantor, the guarantor believes that the old debt has been settled; when the guarantor signs the contract, they are not informed of the purpose of the debt. When handling guarantee disputes in the Beijing area, lawyers usually first verify the corresponding relationship between the new and old loans and whether the guarantor is the same person.Creditor's rights and debts, and enforcementIn business, whether one is aware of something often determines whether they will be held accountable for it.

II. Key points of contention

First, whether there is a corresponding relationship between the new and old loans, and whether the new loan is actually used to repay the old loan; Second, whether the guarantor knows or should know about the practice of borrowing new loans to repay old ones; Third, whether the guarantors of the new and old loans are the same; Fourth, whether the creditor has fulfilled its obligation to inform and whether there is any fault; Fifth, how to calculate the scope of the guarantor's liability and the guarantee period. The above issues directly determine whether the guarantor needs to bear responsibility and the scope of their liability.

III. Professional analysis by Henglue Law Firm

Based on the practical experience of handling guarantee and loan disputes in our firm, there are three key points to note. First, distinguish whether the guarantors are the same. If the guarantors of the new loan and the old loan are the same, the law deems that they continue to bear guarantee responsibility, as the guarantors have already anticipated the risk of debt continuation. If the guarantors are different or new guarantors are added for the new loan, it is necessary to review whether they were aware of this. Second, determine whether the creditor knew or should have known. If the creditor knew about the substitution of old loans with new ones but failed to inform the new guarantors, the new guarantors are usually exempt from liability. Whether the creditor "should have known" can be determined based on transaction practices, contract terms, and communication records. Third, allocate the burden of proof and risk. The creditor needs to provide evidence to prove that the guarantors were aware of this, while the guarantors should retain the signing process, communication records, and contract texts to prove that they were not fully informed. When handling substitution of old loans with new ones, it is advisable for the creditor to specify the use of funds in the contract and obtain the guarantors' written confirmation to avoid the failure of guarantee responsibility. For disputes involving contract performance, the above-mentioned points can be referred to for reference.Business and contract disputes in enterprisesFor issues related to execution, you can refer to the following materials for reference.Creditor's rights and debts, and enforcement.

IV. Practical suggestions and legal basis

Action suggestions: 1. When creditors handle the “borrow new to repay old” transaction, they should specify the purpose of the funds in the contract and obtain written confirmation from the guarantor; 2. Before signing the contract, the guarantor should understand the actual purpose of the loan and, if necessary, request the lender to provide a written explanation; 3. When disputes arise, review the corresponding relationship between the new and old loans and whether the guarantor is the same; 4. Retain the contract, chat records, and transaction records as evidence of whether the guarantor was aware of the situation; 5. When the guarantee period is involved, ensure that rights are asserted within the guarantee period to avoid the exemption of guarantee liability. Legal basis: Articles 681, 692, and 693 of the Civil Code of the People's Republic of China (effective January 1, 2021) regarding the provisions on guarantee contracts, guarantee methods, and guarantee periods; Article 16 of the Interpretation of the Supreme People's Court on the Application of the Civil Code of the People's Republic of China Concerning the Guarantee System (effective January 1, 2021) regarding the guarantor's liability when repaying old loans with new loans. For matters involving creditor-debtor relationships, please refer to the relevant provisions.Creditor's rights and debts, and enforcementFor contracts, you can also refer to the relevant provisions.Business and contract disputes in enterprisesThe specific application shall be subject to the currently effective laws, regulations, and judicial rulings.

5. Henglu Law Firm's Advice

Firstly, whether the guarantor is liable in the process of using new loans to repay old ones depends on whether they are aware of the situation and whether they are the same person. Secondly, the creditor should actively inform and obtain the written confirmation from the new guarantor, otherwise they may face the risk of the guarantee obligation failing. Thirdly, the guarantor must verify the purpose of the loan before signing the contract and not easily believe the verbal explanation. Fourthly, the guarantee period is a mandatory deadline. If the creditor does not assert their rights within the period, the guarantor may be exempt from liability. Fifthly, evidence preservation is of great importance, and both the contract text and communication records can affect the determination of liability. For matters involving creditor-debtor relationships, you can seek legal assistance through legal channels.Creditor's rights and debts, and enforcementFor a comprehensive solution to the service, you can refer to the contract review for referenceBusiness and contract disputes in enterprises.

VI. Frequently Asked Questions

Q1: Is the new guarantor liable if they are unaware of the situation?

Generally, they do not bear the liability. If the creditor and the debtor agree to use the new loan to repay the old loan, and the new guarantor is unaware of the repayment of the old loan with the new loan and is not the same guarantor, the guarantor shall not bear civil liability. Whether the guarantor is aware of the situation shall be determined by the creditor through evidence, which may be combined with the contract terms, communication records, and transaction practices. Therefore, the new guarantor should pay attention to keeping the materials of the signing process to prove that they have not been fully informed.

Q2: Does the same guarantor need to bear responsibility for both the old and new loans?

Generally, if the guarantors of the new loan and the old loan are the same, the law holds that the guarantors of the new loan should bear the guarantee liability, because the same guarantors have already anticipated the risk of the continuation of the debt and cannot claim exemption from liability on the grounds of "borrowing new money to repay old debts". The guarantors should pay attention to the performance of the principal debt and the extension of the loan period, evaluate their own risks in time, and, if necessary, negotiate with the creditors to adjust the guarantee arrangements.

Q3: Are you still liable for the debt even after the guarantee period has passed?

Under normal circumstances, if the creditor fails to assert his rights in accordance with the law within the guarantee period, the guarantor shall no longer bear the guarantee liability. If there is an agreement on the guarantee period, it shall be determined in accordance with the agreement; if there is no agreement, it shall be determined in accordance with the law. Therefore, the guarantor should pay attention to the starting point and expiration date of the guarantee period, and the creditor should assert his rights in a timely manner through litigation or arbitration within the period to avoid the guarantee rights being lost due to the expiration of the time limit.

Q4: How to prove that the guarantor is aware of the situation?

This can be proven through contract terms, records of the signing process, written confirmations, chat and call records, etc. If the contract clearly states that the purpose of the loan is to repay the old loan and the guarantor signs a confirmation, this constitutes strong evidence; if there is only an oral notification without any trace, it will be more difficult to provide evidence. When the creditor handles the "borrow new to repay old" transaction, it is best to require the guarantor to issue a written confirmation of the funds' use.

Q5: What circumstances can a guarantor claim exemption from liability under?

The main ones include: the borrower being unaware of the "borrow new to repay old" and not being the same guarantor; the creditor changing the content of the main debt without the guarantor's written consent and increasing the guarantor's liability; the creditor failing to assert rights after the expiration of the guarantee period; and the guarantee contract being invalid due to the invalidity of the main contract. Whether exemption from liability is possible depends on the specific circumstances of the case and the evidence. It is recommended to sort out the defense strategy under the guidance of a lawyer.

The above answer is based on the judicial practice in Beijing. The judicial interpretations in other provinces and cities may vary. For specific cases, please refer to the local rules and evidence situations.

If you are facing similar problems, it is recommended that you consult a professional lawyer as soon as possible with the evidence materials, so as to avoid missing the statutory time limit. →Legal services for creditor-debtor disputes·Beijing Henglu Law Firm

Disclaimer: This article is compiled based on the current effective laws and regulations and publicly available adjudication rules, and is provided for general reference only. It does not constitute a formal legal opinion on specific cases. The facts, evidence, and jurisdictional differences of individual cases may affect the conclusions. If you encounter disputes, please consult a practicing lawyer in time.