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I’m applying for a business loan and was told I will need to make a “personal guarantee.” What is that?

April 26, 2017Business I’m loan

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I’m applying for a business loan and was told I will need to make a “personal guarantee.” What is that?

1 Answer

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When you make a personal guarantee, you are acting as a co-signer on the loan. That means creditors will go after you if your business fails to make loan payments. The guarantee applies only to you or other partners who sign the loan agreement.