Question

Calvin, a college student, wants to purchase an automobile on credit from irontilt motors. he does not have sufficient income or the credit history to justify the extension of credit to him alone. calvin asks his father to cosign a note to irontilt motors, which his father agrees to. what role does calvin's father fulfill here so that calvin can buy the car?

Answer 1

The answer is : an accommodation party. Accommodation party is a person (the father) who signs a negotiable instrument for the purpose of being a surety for accommodated party to the instrument, a guarantor.