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Building Business Credit Home >
Do
I Need a Personal Guarantee? |
Do I Need A
Personal Guarantee?
There are
many myths and misconceptions regarding the
availability of large cash credit lines being
available without the use of a personal
guarantee. Instead of just telling you whether
these stories are true I want to take a minute
to ask you to ponder something.
Imagine for a second you were a crook, identity
thief or some other unscrupulous individual that
has "done their homework".
- You know you can buy an aged shelf corporation
- You know you can build business credit on this
aged shelf corporation
- You know it takes about 60 days to build business
credit
Knowing these facts do you think that an
unscrupulous individual wouldn't take FULL
advantage of this system and buy an aged
corporation, build business credit, wait 60 days, get the hundreds
of thousands of dollars some claim are available
without a personal guarantee?
If you were the lender would you be willing to
risk giving loans to those who have absolutely
no intention of paying and have no recourse to
get their money back?
That being said, unless you can prove income,
assets and a long positive business credit
history you will ALWAYS have to provide a
personal guarantee for cash loans.
Why then do companies claim that you can
get these loans without a personal guarantee?
1. Many companies will leave out the fact that
the loans you receive without a personal
guarantee are trade credit and not the desired
"cash" credit most clients are seeking.
2. Some companies will provide lenders with
fraudulent documentation to show high assets and
income in order to qualify for these loans
without a personal guarantee. However,
if there is ever an issue, you can rest assured
that as owner of the company that committed the
fraud you will have lots of questions to answer
and are risking jail time.
3. Some companies just plain lie.
Sometimes you just have to use common sense. We
do not mislead customers and just about all
lenders will require a personal guarantee. That
being said, if you have credit issues we will
assist you in correcting them for free if you purchase
our business credit coaching program.
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