Kay borrowed $200,000 for her business. First Bank loaned the money but required a surety and collateral. Kay put up her boat, valued at $110,000, and Anson agreed to guarantee the entire loan. After Kay had paid $50,000 of the loan, she asked First Bank to release the collateral since she wanted to sell it to her brother. The bank looked at her perfect payment record and agreed. Two weeks later,
she sold the business, took the boat to Brazil, and never was heard from again. Can First Bank collect from Anson?
A) No, since they released the collateral
B) Yes, but only $40,000
C) Yes, but only $90,000
D) Yes, and they can get the whole remaining obligation
C
Business
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