Bank loan responsibility for corporation partners

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I own 25% of a small corporation. My partner (who owns the other 75%) and I took a loan with a bank (TD). We both had to give personal guarantees. Am I only responsible for 25% of the loan?
If we go bankrupt can the bank come after me for the full amount in case my partner does not have any personal assets anymore?



Thanks for your help!






loans corporation







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    Do the loan documents not address this?
    – Hart CO
    1 hour ago
















up vote
2
down vote

favorite












I own 25% of a small corporation. My partner (who owns the other 75%) and I took a loan with a bank (TD). We both had to give personal guarantees. Am I only responsible for 25% of the loan?
If we go bankrupt can the bank come after me for the full amount in case my partner does not have any personal assets anymore?



Thanks for your help!






loans corporation







share|improve this question







New contributor




Gerald is a new contributor to this site. Take care in asking for clarification, commenting, and answering.
Check out our Code of Conduct.















  • 1




    Do the loan documents not address this?
    – Hart CO
    1 hour ago












up vote
2
down vote

favorite









up vote
2
down vote

favorite











I own 25% of a small corporation. My partner (who owns the other 75%) and I took a loan with a bank (TD). We both had to give personal guarantees. Am I only responsible for 25% of the loan?
If we go bankrupt can the bank come after me for the full amount in case my partner does not have any personal assets anymore?



Thanks for your help!






loans corporation







share|improve this question







New contributor




Gerald is a new contributor to this site. Take care in asking for clarification, commenting, and answering.
Check out our Code of Conduct.











I own 25% of a small corporation. My partner (who owns the other 75%) and I took a loan with a bank (TD). We both had to give personal guarantees. Am I only responsible for 25% of the loan?
If we go bankrupt can the bank come after me for the full amount in case my partner does not have any personal assets anymore?



Thanks for your help!






loans corporation




loans corporation






share|improve this question







New contributor




Gerald is a new contributor to this site. Take care in asking for clarification, commenting, and answering.
Check out our Code of Conduct.











share|improve this question







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  • 1




    Do the loan documents not address this?
    – Hart CO
    1 hour ago












  • 1




    Do the loan documents not address this?
    – Hart CO
    1 hour ago







1




1




Do the loan documents not address this?
– Hart CO
1 hour ago




Do the loan documents not address this?
– Hart CO
1 hour ago










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If the loan documents you signed do not specify otherwise, it is most likely that you have effectively personally guaranteed 100% of the loan, meaning the bank may try to go after you and your partner equally in the event of a corporate bankruptcy. It would be up to you, after the fact, to sue your partner for the extra 25% if you ended up settling the bank loan 50:50 (or, if you end up paying 100% back, in the event the bank finds that your partner has no ability to pay them anything).



Note that this is the same as if you co-sign on a loan for someone - the bank effectively has the right to pursue the co-signer for 100% of the loan balance if it is not being paid on time (even if the co-signer might be, say, a friend who owns 0% of a car purchased with the loan), and it would be up to that co-signer to sue the borrower for payment if they end up paying the bank.



The horse is out of the barn now, but in the future you must make sure you understand what you are signing, when you sign any legal agreement like this. Although it may still be a good idea to have a lawyer review this specific agreement now, in order for you to have the clearest idea of what the worst case scenario might be, and whether you can mitigate that risk.






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    If the loan documents you signed do not specify otherwise, it is most likely that you have effectively personally guaranteed 100% of the loan, meaning the bank may try to go after you and your partner equally in the event of a corporate bankruptcy. It would be up to you, after the fact, to sue your partner for the extra 25% if you ended up settling the bank loan 50:50 (or, if you end up paying 100% back, in the event the bank finds that your partner has no ability to pay them anything).



    Note that this is the same as if you co-sign on a loan for someone - the bank effectively has the right to pursue the co-signer for 100% of the loan balance if it is not being paid on time (even if the co-signer might be, say, a friend who owns 0% of a car purchased with the loan), and it would be up to that co-signer to sue the borrower for payment if they end up paying the bank.



    The horse is out of the barn now, but in the future you must make sure you understand what you are signing, when you sign any legal agreement like this. Although it may still be a good idea to have a lawyer review this specific agreement now, in order for you to have the clearest idea of what the worst case scenario might be, and whether you can mitigate that risk.






    share|improve this answer


























      up vote
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      down vote













      If the loan documents you signed do not specify otherwise, it is most likely that you have effectively personally guaranteed 100% of the loan, meaning the bank may try to go after you and your partner equally in the event of a corporate bankruptcy. It would be up to you, after the fact, to sue your partner for the extra 25% if you ended up settling the bank loan 50:50 (or, if you end up paying 100% back, in the event the bank finds that your partner has no ability to pay them anything).



      Note that this is the same as if you co-sign on a loan for someone - the bank effectively has the right to pursue the co-signer for 100% of the loan balance if it is not being paid on time (even if the co-signer might be, say, a friend who owns 0% of a car purchased with the loan), and it would be up to that co-signer to sue the borrower for payment if they end up paying the bank.



      The horse is out of the barn now, but in the future you must make sure you understand what you are signing, when you sign any legal agreement like this. Although it may still be a good idea to have a lawyer review this specific agreement now, in order for you to have the clearest idea of what the worst case scenario might be, and whether you can mitigate that risk.






      share|improve this answer
























        up vote
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        up vote
        3
        down vote









        If the loan documents you signed do not specify otherwise, it is most likely that you have effectively personally guaranteed 100% of the loan, meaning the bank may try to go after you and your partner equally in the event of a corporate bankruptcy. It would be up to you, after the fact, to sue your partner for the extra 25% if you ended up settling the bank loan 50:50 (or, if you end up paying 100% back, in the event the bank finds that your partner has no ability to pay them anything).



        Note that this is the same as if you co-sign on a loan for someone - the bank effectively has the right to pursue the co-signer for 100% of the loan balance if it is not being paid on time (even if the co-signer might be, say, a friend who owns 0% of a car purchased with the loan), and it would be up to that co-signer to sue the borrower for payment if they end up paying the bank.



        The horse is out of the barn now, but in the future you must make sure you understand what you are signing, when you sign any legal agreement like this. Although it may still be a good idea to have a lawyer review this specific agreement now, in order for you to have the clearest idea of what the worst case scenario might be, and whether you can mitigate that risk.






        share|improve this answer














        If the loan documents you signed do not specify otherwise, it is most likely that you have effectively personally guaranteed 100% of the loan, meaning the bank may try to go after you and your partner equally in the event of a corporate bankruptcy. It would be up to you, after the fact, to sue your partner for the extra 25% if you ended up settling the bank loan 50:50 (or, if you end up paying 100% back, in the event the bank finds that your partner has no ability to pay them anything).



        Note that this is the same as if you co-sign on a loan for someone - the bank effectively has the right to pursue the co-signer for 100% of the loan balance if it is not being paid on time (even if the co-signer might be, say, a friend who owns 0% of a car purchased with the loan), and it would be up to that co-signer to sue the borrower for payment if they end up paying the bank.



        The horse is out of the barn now, but in the future you must make sure you understand what you are signing, when you sign any legal agreement like this. Although it may still be a good idea to have a lawyer review this specific agreement now, in order for you to have the clearest idea of what the worst case scenario might be, and whether you can mitigate that risk.







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