Construction Estimator Certified (CEC) 2025 – 400 Free Practice Questions to Pass the Exam

The answer indicating payment guaranties from Crown Development and Maxwell Crown would provide the bank the most protection in a loan to Crown Properties, LLC because payment guaranties are specifically designed to ensure that a lender will receive payment regardless of the circumstances surrounding the borrower's ability to repay the loan.

This form of guarantee means that if Crown Properties, LLC fails to make the payments, the guarantors—Crown Development and Maxwell Crown—are personally responsible for fulfilling that financial obligation. This adds a significant layer of security for the bank, as it can directly enforce payment against these guarantors if necessary.

In comparison, other types of support such as unlimited guaranties from 20% owners or pro rata guaranties from each of the owners may not provide the same level of assurance because they can be less enforceable or more complicated in terms of extracting funds if the business faces financial difficulties. A collection guaranty from Crown Development Corporation could offer some protection, but it typically does not guarantee payment in the same definitive manner that a payment guaranty would, making it less favorable for the lender looking for robust security.