A college student wants to purchase a car and asks a wealthy uncle to guarantee the loan. The uncle orally promises to guarantee the loan. The guarantee falls under the statute of frauds; is it enforceable?

• A. Yes, because consideration was present.
• B. Yes, because the statute of frauds does not apply to suretyship.
• C. No, because suretyship must be in writing to be enforceable.
• D. No, because the loan is for the student's benefit.

Answer: (C)

Understanding the Statute of Frauds for suretyship is key. A promise to answer for the debt of another must be in writing to be enforceable. The uncle’s oral guarantee is a collateral promise to pay someone else’s debt if the student doesn’t pay. Because there is no writing, it isn’t enforceable against the uncle under the statute, regardless of consideration or the loan benefiting the student. The only way it would be enforceable is if there were a signed writing that satisfies the Statute of Frauds (clearly identifying the debtor, guarantor, and the terms). The loan benefiting the student does not remove the writing requirement.