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Guarantees
If your company is borrowing money it is likely the lender will require you to personally guarantee the loan. This means as guarantor you stand in the place of the borrower, i.e the company, should the company default on the loan.
The nature of the guarantee will:
- vary depending on the circumstances
- usually remain in place for the life of the loan which may be many years.
You should think carefully about giving a personal guarantee.
You should:
- obtain good independent advice
- understand the effect should the company default
- be sure you have the resources to honour the commitments contained in the guarantee
- consider fixing the maximum amount for which you might be liable
- ensure your liability cannot be increased
At Hart Brown we regularly advise potential guarantors about the risks involved and their options. Not all proceed with the giving of the guarantee.
We will help you cut through the jargon and make sure you fully understand what you are being asked to do.
To speak to someone who can advise on guarantees or any other legal matters relating to your business call, email or request a call back from one of our specialist lawyers.