Mixing
Bank loan responsibility for corporation partners
Clash Royale CLAN TAG#URR8PPP
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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
asked 1 hour ago
Gerald
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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
asked 1 hour ago
Gerald
111
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
add a comment |Â
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
asked 1 hour ago
Gerald
111
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
asked 1 hour ago
Gerald
111
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.
asked 1 hour ago
Gerald
111
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.
asked 1 hour ago
Gerald
111
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.
asked 1 hour ago
Gerald
111
asked 1 hour ago
Gerald
111
111
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.
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.
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
add a comment |Â
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
add a comment |Â
1 Answer
1
active
oldest
votes
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.
answered 1 hour ago
Grade 'Eh' Bacon
17.7k74866
add a comment |Â
1 Answer
1
active
oldest
votes
1 Answer
1
active
oldest
votes
active
oldest
votes
active
oldest
votes
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.
answered 1 hour ago
Grade 'Eh' Bacon
17.7k74866
add a comment |Â
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.
answered 1 hour ago
Grade 'Eh' Bacon
17.7k74866
add a comment |Â
up vote
3
down vote
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.
answered 1 hour ago
Grade 'Eh' Bacon
17.7k74866
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.
answered 1 hour ago
Grade 'Eh' Bacon
17.7k74866
edited 36 mins ago
answered 1 hour ago
Grade 'Eh' Bacon
17.7k74866
answered 1 hour ago
Grade 'Eh' Bacon
17.7k74866
answered 1 hour ago
Grade 'Eh' Bacon
17.7k74866
17.7k74866
add a comment |Â
add a comment |Â
Gerald is a new contributor. Be nice, and check out our Code of Conduct.
Gerald is a new contributor. Be nice, and check out our Code of Conduct.
Gerald is a new contributor. Be nice, and check out our Code of Conduct.
Gerald is a new contributor. Be nice, and check out our Code of Conduct.
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1
Do the loan documents not address this?
– Hart CO
1 hour ago