Responsibility on loans
I am a sole prop. and I am thinking of going LLC or INC. If I was to apply for a sba loan, how would I protect my personal property? Most banks are telling me that the guarantor on the loan would be responsible but I need to find out how to protect my personal property before I take this step. Thanks!
1 Answer from Attorneys
Re: Responsibility on loans
You generally can limit your liability by setting up an LLC or S-corporation. However, if a lender requires a personal guaranty of the loan to the LLC or corporation, your personal assets could nevertheless be at risk. There are ways to structure the guaranty with the lender upfront that can minimize these risks. Please feel free to call me to discuss further.
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