In one sentence
A loan where the borrower and guarantors are personally liable for repayment beyond the collateral itself.
The longer version
Under a recourse loan the lender can pursue the borrower's other assets if the collateral falls short. Community banks and credit unions often lend with recourse, unlike the non-recourse institutional market.
Recourse changes the guaranty analysis and the sponsor's exposure, a fundamental structural point in underwriting.
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