Security means that, in the course of the borrowing, third parties provide the borrower with a guarantee that the borrowed funds will be repaid on time. The guarantor is usually a relative of the borrower or an institution with a corresponding credit line. However, since the guarantee implied that the borrower was not liable for the timely repayment of the loan, it was a matter of concern whether the guarantor was entitled to cancel the security。

Can the guarantor cancel the guarantee

First, we need to clarify the legal nature of security. In China, security is a civil act whose legal basis includes, inter alia, the Law of the People ' s Republic of China on Contracts and the Law of the People ' s Republic of China on Guarantees. Under security law, the guarantor had a certain legal right at the time of signing the security contract, including the right to exercise a right of discharge and defence. Thus, from a legal point of view, the guarantor has the right to cancel the security。

Second, the guarantor's cancellation of the security relates to the borrower's interests. If the guarantor takes the initiative to cancel the guarantee, the borrower ' s credit will be seriously compromised and may not continue to receive the loan. The interests of borrowers therefore need to be protected. In practice, banks usually require the guarantor to provide an application for a written release and to reassess the borrower's repayment capacity to ensure that the borrower remains able to repay the loan on time。

In addition, the removal of the guarantee by the guarantor would involve the discharge of the loan contract and the legality of the borrowing. The validity of the loan contract after the guarantor has cancelled the guarantee is a dispute. We can consider this through contract law. Under contract law, security is a legal act between the creditor and the debtor and its discharge is subject to consultation or legal relief. Thus, the cancellation of the guarantee by the guarantor would not automatically release the borrowing contract, the validity of which would need to be judged on a case-by-case basis。

Finally, we need to consider the question of the subsequent liability of the guarantor following the cancellation of the guarantee. If the borrower is unable to repay the loan on time after the guarantor has cancelled the guarantee, there may be economic loss to the guarantor. Under the Guarantee Act, if the borrower is unable to meet its repayment obligations, the guarantor remains liable for the corresponding breach. Thus, the guarantor's cancellation of the security does not directly relieve it of the security responsibility it has already assumed。

In the light of the above, the guarantor is entitled to cancel the security under certain conditions, but its cancellation requires the protection of the borrower's interests and requires consultation or legal proceedings. At the same time, the cancellation of the guarantee by the guarantor would not automatically release the borrowing contract and its subsequent liability would remain. In practice, therefore, the guarantor should give careful consideration to cancelling the security and exercise its rights to the extent of legitimate compliance。