Personal Guarantee Advice for Directors on buy to let mortgages
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When it comes to personal guarantees for directors in the UK, it's crucial to consult with a qualified solicitor who specialises in corporate and contract law. They can provide you with personalised advice based on your specific circumstances. Nevertheless, here are some general points to consider:
personal onUnderstand the concept of a personal guarantee: A personal guarantee is a legal commitment made by an individual (such as a director) to assume responsibility for a debt or obligation if the company fails to fulfill it. It means that the guarantor's personal assets may be at risk if the company defaults.
Carefully review the terms and conditions: Before signing any personal guarantee, thoroughly read and understand its terms and conditions. Pay close attention to the scope of the guarantee, the extent of liability, and any limitations or exclusions. Seek legal advice to ensure you fully comprehend the implications.
Negotiate and limit your exposure: If possible, negotiate the terms of the personal guarantee to reduce your potential liability. You may explore options such as limiting the guarantee to a specific amount, a fixed period, or certain circumstances. Consult with legal professionals to help you negotiate terms that protect your interests.
Seek independent legal advice: It's advisable to obtain independent legal advice when presented with a personal guarantee. This ensures you have a clear understanding of the implications and potential risks involved. An experienced solicitor can review the agreement, advise you on its fairness, and suggest any necessary amendments.
Consider alternative options: In some cases, you may explore alternative ways to provide security or collateral without directly offering a personal guarantee. For instance, you could consider offering a debenture or other forms of security that may protect your personal assets while providing assurance to the mortgage company.
Remember, the information provided here is for general guidance only and should not be considered as legal advice. Consulting with a qualified legal professional is essential to address your specific situation.
Our solicitors are able to provide this advice as often mortgage companies will insist this is a requirement to obtaining the mortgage.
Legal Peace Solicitors
1st floor, Imperial House,
21-25 North Street,
Bromley, BR1 1SD
124 City Road,
London EC1V 2NX
LEGAL PEACE is a trading name for Harry Legal & Advocacy Services Ltd registered in England and Wales under registration number 12053238 and is regulated by the SRA under registration number 831588