Comments on: Business Line of Credit – personal guarantee consequences? http://aspenfinancialgroup.com/business-line-of-credit-personal-guarantee-consequences.htm Fri, 21 Oct 2011 00:09:40 +0000 http://wordpress.org/?v=2.9.2 hourly 1 By: FRANK Mortgage Broker http://aspenfinancialgroup.com/business-line-of-credit-personal-guarantee-consequences.htm/comment-page-1#comment-293 FRANK Mortgage Broker Fri, 03 Jul 2009 15:30:15 +0000 http://aspenfinancialgroup.com/business-line-of-credit-personal-guarantee-consequences.htm#comment-293 The lender can and will hold you responsible. I suggest that you attempt to work out repayment with the lender. Be carefull. If you get the bank to accept less than what is owed, then the forgiveness of part of the debt is income. You will have to pay taxes. The bankruptcy will hurt your credit. It stays on the credit report for about 10 years. You may stil be required to pay back the debt, depending on the terms of bankruptcy. Personal bankruptcy, Chapter 7, will erase the debt, but you lose you home, savings, etc. Chapter 11 (business)or chapter 13 (personal) is a debt restructuring. You still have to pay back the loan. If the business files bankruptcy, it will show up on your credit. The lender can and will hold you responsible.

I suggest that you attempt to work out repayment with the lender.

Be carefull. If you get the bank to accept less than what is owed, then the forgiveness of part of the debt is income. You will have to pay taxes.

The bankruptcy will hurt your credit. It stays on the credit report for about 10 years. You may stil be required to pay back the debt, depending on the terms of bankruptcy. Personal bankruptcy, Chapter 7, will erase the debt, but you lose you home, savings, etc. Chapter 11 (business)or chapter 13 (personal) is a debt restructuring. You still have to pay back the loan.

If the business files bankruptcy, it will show up on your credit.

]]> By: R C http://aspenfinancialgroup.com/business-line-of-credit-personal-guarantee-consequences.htm/comment-page-1#comment-294 R C Fri, 03 Jul 2009 15:30:15 +0000 http://aspenfinancialgroup.com/business-line-of-credit-personal-guarantee-consequences.htm#comment-294 Your credit score is going to take a nose dive regardless of what you do if that loan is not paid. Talk to an Attorney and even a BK Atty to discuss your options but I think you will find the first responder is pretty right on. If the put the loan in default and take it to court they could get a Judgment against you and then take steps to satisfy that Judgment. Best see the Atty in the morning. Your credit score is going to take a nose dive regardless of what you do if that loan is not paid.

Talk to an Attorney and even a BK Atty to discuss your options but I think you will find the first responder is pretty right on. If the put the loan in default and take it to court they could get a Judgment against you and then take steps to satisfy that Judgment. Best see the Atty in the morning.

]]> By: stephenweinstein http://aspenfinancialgroup.com/business-line-of-credit-personal-guarantee-consequences.htm/comment-page-1#comment-295 stephenweinstein Fri, 03 Jul 2009 15:30:15 +0000 http://aspenfinancialgroup.com/business-line-of-credit-personal-guarantee-consequences.htm#comment-295 Personal bankruptcy will make your credit score very bad for 7-10 years. Any other solution is better. One option may be a home equity loan. Borrow enough to pay off the business loan. Personal bankruptcy will make your credit score very bad for 7-10 years. Any other solution is better.

One option may be a home equity loan. Borrow enough to pay off the business loan.

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