Personal gurantee - Options to deal with the same.

[Restart]

Hi,

 

My business is now going through insolvency and I have an outstanding Natwest business loan of around £20,000 with a personal guarantee to me.

 

The insolvency people will be contacting the bank now to freeze accounts as part of what they need to do.

 

The bank has not yet contacted me and all payments have been up to date.

 

I do have a small amount of personal savings but I was wondering what the best steps of action are here for me.

 

Luckily most of my creditors had been paid.

 

However, I also have an outstanding business loan to the Funding Circle of around £40,000 with a personal guarantee to me

 

Funding Circle have not yet contacted me and all payments have been up to date. My insolvency agent is in the process of contacting creditors now.

 

I do have a small amount of personal savings but I was wondering what the best steps of action are here for me.

 

Thanks for your help.

 

Thanks for your help.

[dx100uk]

ive merged your threads

can i just confirm you thus have 2 outstanding business loans

one with natwest

one with the funding circle

 

and both you know you signed personal guarantees as well as the std loan paperwork as a business?

 

[stu007]

Hi

 

I know this is a difficult time for a lot of Business owners due to the Pandemic and am sorry you are now in this situation.

 

Did the Courts appoint the Insolvency Practitioner?

 

Is the Insolvency Practitioner aware of the NatWest Business Loan and that it is with a Personal Guarantee? (if not you need to inform the Insolvency Practitioner)

 

Was the NatWest Business Loan with your Personal Guarantee signed as you being Director of that Company?

 

Are you able to keep up the Repayments for this Business Loan with Personal Guarantee?

 

As this is a Personal Guarantee for a Business loan which would more than likely have been signed with you as in the position of Director of the Company (correct me if I am wrong) This is you making a Legal Agreement as director who is liable for paying that debt and in this case as the Business in now going through Insolvency Proceeding.

 

The consequences for yourself depend on the actions of NatWest and if you can't keep up their repayments as your Business is going through Insolvency, NatWest could enforce that Personal Guarantee to recoup their money by going after your personal assets which could be at risk (not business assets) as this was a Personal Guarantee so you need to be fully aware of that. (it would also depend on the wording in that Personal Guarantee you signed)

 

You need to fully read that Personal Guarantee that you signed with NatWest to understand that actions they can take to recoup that money

[Restart]

Hi dx100uk, Thanks for merging. I wasn't sure if two threads would be better or not.

 

Yes, Besides the standard loan paperwork there is a clause in each that deals with PG. I signed nothing separate.

 

Thanks again.

 

Thanks for the reply stu007. My anwers are below.

 

Hi

 

I know this is a difficult time for a lot of Business owners due to the Pandemic and am sorry you are now in this situation.  Thanks

 

Did the Courts appoint the Insolvency Practitioner? Courts are not involved. I instructed insolvency via my accountants.

 

Is the Insolvency Practitioner aware of the NatWest Business Loan and that it is with a Personal Guarantee? (if not you need to inform the Insolvency Practitioner) Insolvency are aware of the PG's yes.

 

Was the NatWest Business Loan with your Personal Guarantee signed as you being Director of that Company? As company director yes.

 

Are you able to keep up the Repayments for this Business Loan with Personal Guarantee? With help from family I could. I can also raise funds from family to discuss a full and final offer deal with both.

 

As this is a Personal Guarantee for a Business loan which would more than likely have been signed with you as in the position of Director of the Company (correct me if I am wrong) This is you making a Legal Agreement as director who is liable for paying that debt and in this case as the Business in now going through Insolvency Proceeding. Agreed.

 

The consequences for yourself depend on the actions of NatWest and if you can't keep up their repayments as your Business is going through Insolvency, NatWest could enforce that Personal Guarantee to recoup their money by going after your personal assets which could be at risk (not business assets) as this was a Personal Guarantee so you need to be fully aware of that. (it would also depend on the wording in that Personal Guarantee you signed) Understood.

 

You need to fully read that Personal Guarantee that you signed with NatWest to understand that actions they can take to recoup that money Thanks.

  

 

[mantis shrimp]

I am sorry to read this Restart. You are in a difficult situation.

 

As your company is in a formal insolvency process, it is likely that both NatWest and Funding Circle will be looking to you under the guarantees that you have given.  They may take legal action, i.e. sue you in the courts. Or they may serve statutory demands for payment as a first step towards bankruptcy action.

 

I say this to help you understand that this could well be a very serious situation. My advice would be to engage with each to try to negotiate time to pay and/or to see if they will accept lesser sums in full and final settlement.

 

Is there any likelihood that your company will be able to pay anything towards these debts? If so, you may be entitled to receive something from the company, but probably only after you have paid up under your guarantees (this is definitely the case with NatWest guarantees). This can be a complicated area and will require detailed study of the terms of the guarantees.

[Restart]

Thanks mantis shrimp

 

Is there someone I can approach to have the agreements checked before my negotiating with both companies. Some kind of lawyer maybe. I'm thinking these agreements maybe used for all loans and possibly a standard agreement to them?

 

Thanks again.

[dx100uk]

Scan everything up to one mass pdf

read upload carefully!!

 

Dx

[mantis shrimp]

They will be the companies' standard forms. 

 

If you want professional advice a solicitor would be a good kind of lawyer. 

 

Please note that there are very limited grounds on which a guarantee claim can be contested with any realistic hope of success.

 

I would check that the document has been signed (pretty basic, but you never know) and also whether the circumstances/timing raise any possibility of arguing that no consideration was given to you (very occasionally the lender has messed up and this argument has legs). 

[Restart]

Hi all.

 

I posted a thread back in January (link below). Natwest have now sent a letter asking for just under £14,000 as the amount owing under the personal gurantee I signed back in 2019. I don't dispute that I owe them money but I was wondering the following?

 

1. The letter from Natwest just gives an amount due. Can I ask for conformation of how this figure has been arrived at?

2. £14,000 is a lot to get hold of in one go. Would it be reasonable to offer to repay at the monthly repayment amount agreed in the original agreement?

 

3. Can Natwest continue to apply interest payments to the outstanding amount after seeking payment from guarantor?

 

4. I am not working yet but would like to avoid legal proceedings. I could, with the help of family get together around £5,000. I wonder if a full and final settlement offer maybe excepted?

 

Once again, thanks for your help on this.

 

 

 

[Andyorch]

Topics merged please do not start new topics on the same matter ....use the report topic button to request an old topic be reopened.

 

Regards

 

Andy

[dx100uk]

On 24/01/2022 at 17:22, dx100uk said:

Scan everything up to one mass pdf

read upload carefully!!

 

Dx