{"id":13911,"date":"2023-05-04T15:29:47","date_gmt":"2023-05-04T07:29:47","guid":{"rendered":"https:\/\/peronaccountants.com.au\/?p=13911"},"modified":"2023-05-04T15:29:47","modified_gmt":"2023-05-04T07:29:47","slug":"what-are-the-risks-of-taking-out-a-personal-guarantee-on-a-loan","status":"publish","type":"post","link":"https:\/\/peronaccountants.com.au\/what-are-the-risks-of-taking-out-a-personal-guarantee-on-a-loan\/","title":{"rendered":"What are the risks of taking out a personal guarantee on a loan?"},"content":{"rendered":"<p><img loading=\"lazy\" decoding=\"async\" class=\"size-medium wp-image-13912\" src=\"https:\/\/peronaccountants.com.au\/app\/uploads\/lcphgxs7pww-300x200.jpg\" alt=\"fan of 100 U.S. dollar banknotes\" width=\"300\" height=\"200\" srcset=\"https:\/\/peronaccountants.com.au\/app\/uploads\/lcphgxs7pww-300x200.jpg 300w, https:\/\/peronaccountants.com.au\/app\/uploads\/lcphgxs7pww-1024x683.jpg 1024w, https:\/\/peronaccountants.com.au\/app\/uploads\/lcphgxs7pww-1536x1024.jpg 1536w, https:\/\/peronaccountants.com.au\/app\/uploads\/lcphgxs7pww-292x195.jpg 292w, https:\/\/peronaccountants.com.au\/app\/uploads\/lcphgxs7pww-150x100.jpg 150w, https:\/\/peronaccountants.com.au\/app\/uploads\/lcphgxs7pww-1320x880.jpg 1320w, https:\/\/peronaccountants.com.au\/app\/uploads\/lcphgxs7pww.jpg 1600w\" sizes=\"(max-width: 300px) 100vw, 300px\" \/><\/p>\n<p>To fund the growth of your business, you\u2019ll almost certainly need to take out a business loan at some point. But many lenders will ask you to provide a personal guarantee against this business loan \u2013 and there\u2019s a risk element to consider when taking out finance.<\/p>\n<p>So, what does offering a personal guarantee on a secured loan actually entail? And what are the principal risks of becoming a guarantor?<\/p>\n<p><strong>Understanding the key risks of a personal guarantee<\/strong><\/p>\n<p>When you agree to offer a personal guarantee, you\u2019re essentially promising to repay the loan if the business can&#8217;t make the payments \u2013 and to do this out of your own money or assets. This might seem like a small step to take, but giving a personal guarantee can have serious consequences if your business is unable to repay the loan.<\/p>\n<p>Here are some of the risks of giving a personal guarantee:<\/p>\n<ul>\n<li><strong>Personal liability<\/strong> \u2013 by signing a personal guarantee for the loan, you&#8217;re putting your own personal assets on the line. If your business defaults on the loan, the lender can come after your personal assets to collect the debt. This means your home, car, savings, and other personal assets are all fair game and could be at risk.<\/li>\n<li><strong>Negative impact on credit score<\/strong> \u2013 if the lender comes after your personal assets, this can have a negative impact on your personal credit score. As a result, it could become more difficult for you to obtain credit in the future. Lenders will see you as a higher risk, which could affect your ability to borrow, take out a mortgage or find personal finance.<\/li>\n<li><strong>Strained relationships<\/strong> \u2013 when you&#8217;re asked to give a personal guarantee by a business partner or family member, this can put a strain on your business and personal relationships. Having to repay the loan from your own assets can cause resentment, mistrust and ongoing problems between you and your partner, or family member.<\/li>\n<li><strong>Difficulty obtaining credit for your business<\/strong> \u2013 giving a personal guarantee for a loan may get the business out of a short-term financial hole. But when the business relies on personal loans from directors, this can impact your ability to obtain credit for your business in the future. Lenders see this as a risk and may be less likely to extend credit.<\/li>\n<li><strong>Risk of bankruptcy<\/strong> \u2013 if the business can\u2019t repay the loan and the lender comes after your personal assets, this has the potential to push you into personal bankruptcy. Becoming bankrupt can have serious long-term consequences, including difficulty obtaining credit, loss of assets and damage to your credit score.<\/li>\n<\/ul>\n<p>&nbsp;<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Do you know the risks of offering a personal guarantee on a business loan? We\u2019ve outlined all the key risks to think about when entering into a loan agreement.<br \/>\n#businessadvice #personalguarantees <\/p>\n","protected":false},"author":13,"featured_media":13913,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":"","jetpack_publicize_message":"","jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":true,"jetpack_social_options":{"image_generator_settings":{"template":"highway","enabled":false}}},"categories":[1],"tags":[],"jetpack_publicize_connections":[],"acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v22.6 (Yoast SEO v22.6) - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>What are the risks of taking out a personal guarantee on a loan? - Peron Accountants<\/title>\n<meta name=\"description\" content=\"Do you know the risks of offering a personal guarantee on a business loan? We\u2019ve outlined all the key risks to think about when entering into a loan agreement. #businessadvice #personalguarantees\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/peronaccountants.com.au\/what-are-the-risks-of-taking-out-a-personal-guarantee-on-a-loan\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"What are the risks of taking out a personal guarantee on a loan?\" \/>\n<meta property=\"og:description\" content=\"Do you know the risks of offering a personal guarantee on a business loan? We\u2019ve outlined all the key risks to think about when entering into a loan agreement. #businessadvice #personalguarantees\" \/>\n<meta property=\"og:url\" content=\"https:\/\/peronaccountants.com.au\/what-are-the-risks-of-taking-out-a-personal-guarantee-on-a-loan\/\" \/>\n<meta property=\"og:site_name\" content=\"Peron Accountants\" \/>\n<meta property=\"article:published_time\" content=\"2023-05-04T07:29:47+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/peronaccountants.com.au\/app\/uploads\/lcphgxs7pww-300x200-1.jpg\" \/>\n\t<meta property=\"og:image:width\" content=\"300\" \/>\n\t<meta property=\"og:image:height\" content=\"200\" \/>\n\t<meta property=\"og:image:type\" content=\"image\/jpeg\" \/>\n<meta name=\"author\" content=\"Charmaine Grant\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"Charmaine Grant\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"3 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\/\/schema.org\",\"@graph\":[{\"@type\":\"Article\",\"@id\":\"https:\/\/peronaccountants.com.au\/what-are-the-risks-of-taking-out-a-personal-guarantee-on-a-loan\/#article\",\"isPartOf\":{\"@id\":\"https:\/\/peronaccountants.com.au\/what-are-the-risks-of-taking-out-a-personal-guarantee-on-a-loan\/\"},\"author\":{\"name\":\"Charmaine Grant\",\"@id\":\"https:\/\/peronaccountants.com.au\/#\/schema\/person\/2b80e2a8a723915f6320f9756c445a13\"},\"headline\":\"What are the risks of taking out a personal guarantee on a loan?\",\"datePublished\":\"2023-05-04T07:29:47+00:00\",\"dateModified\":\"2023-05-04T07:29:47+00:00\",\"mainEntityOfPage\":{\"@id\":\"https:\/\/peronaccountants.com.au\/what-are-the-risks-of-taking-out-a-personal-guarantee-on-a-loan\/\"},\"wordCount\":447,\"publisher\":{\"@id\":\"https:\/\/peronaccountants.com.au\/#organization\"},\"image\":{\"@id\":\"https:\/\/peronaccountants.com.au\/what-are-the-risks-of-taking-out-a-personal-guarantee-on-a-loan\/#primaryimage\"},\"thumbnailUrl\":\"https:\/\/peronaccountants.com.au\/app\/uploads\/lcphgxs7pww-300x200-1.jpg\",\"articleSection\":[\"Firm News\"],\"inLanguage\":\"en-US\"},{\"@type\":\"WebPage\",\"@id\":\"https:\/\/peronaccountants.com.au\/what-are-the-risks-of-taking-out-a-personal-guarantee-on-a-loan\/\",\"url\":\"https:\/\/peronaccountants.com.au\/what-are-the-risks-of-taking-out-a-personal-guarantee-on-a-loan\/\",\"name\":\"What are the risks of taking out a personal guarantee on a loan? - Peron Accountants\",\"isPartOf\":{\"@id\":\"https:\/\/peronaccountants.com.au\/#website\"},\"primaryImageOfPage\":{\"@id\":\"https:\/\/peronaccountants.com.au\/what-are-the-risks-of-taking-out-a-personal-guarantee-on-a-loan\/#primaryimage\"},\"image\":{\"@id\":\"https:\/\/peronaccountants.com.au\/what-are-the-risks-of-taking-out-a-personal-guarantee-on-a-loan\/#primaryimage\"},\"thumbnailUrl\":\"https:\/\/peronaccountants.com.au\/app\/uploads\/lcphgxs7pww-300x200-1.jpg\",\"datePublished\":\"2023-05-04T07:29:47+00:00\",\"dateModified\":\"2023-05-04T07:29:47+00:00\",\"description\":\"Do you know the risks of offering a personal guarantee on a business loan? We\u2019ve outlined all the key risks to think about when entering into a loan agreement. #businessadvice #personalguarantees\",\"breadcrumb\":{\"@id\":\"https:\/\/peronaccountants.com.au\/what-are-the-risks-of-taking-out-a-personal-guarantee-on-a-loan\/#breadcrumb\"},\"inLanguage\":\"en-US\",\"potentialAction\":[{\"@type\":\"ReadAction\",\"target\":[\"https:\/\/peronaccountants.com.au\/what-are-the-risks-of-taking-out-a-personal-guarantee-on-a-loan\/\"]}]},{\"@type\":\"ImageObject\",\"inLanguage\":\"en-US\",\"@id\":\"https:\/\/peronaccountants.com.au\/what-are-the-risks-of-taking-out-a-personal-guarantee-on-a-loan\/#primaryimage\",\"url\":\"https:\/\/peronaccountants.com.au\/app\/uploads\/lcphgxs7pww-300x200-1.jpg\",\"contentUrl\":\"https:\/\/peronaccountants.com.au\/app\/uploads\/lcphgxs7pww-300x200-1.jpg\",\"width\":300,\"height\":200,\"caption\":\"Lcphgxs7pww 300x200\"},{\"@type\":\"BreadcrumbList\",\"@id\":\"https:\/\/peronaccountants.com.au\/what-are-the-risks-of-taking-out-a-personal-guarantee-on-a-loan\/#breadcrumb\",\"itemListElement\":[{\"@type\":\"ListItem\",\"position\":1,\"name\":\"Home\",\"item\":\"https:\/\/peronaccountants.com.au\/\"},{\"@type\":\"ListItem\",\"position\":2,\"name\":\"What are the risks of taking out a personal guarantee on a loan?\"}]},{\"@type\":\"WebSite\",\"@id\":\"https:\/\/peronaccountants.com.au\/#website\",\"url\":\"https:\/\/peronaccountants.com.au\/\",\"name\":\"Peron Accountants\",\"description\":\"Accountants in Rockingham\",\"publisher\":{\"@id\":\"https:\/\/peronaccountants.com.au\/#organization\"},\"potentialAction\":[{\"@type\":\"SearchAction\",\"target\":{\"@type\":\"EntryPoint\",\"urlTemplate\":\"https:\/\/peronaccountants.com.au\/?s={search_term_string}\"},\"query-input\":\"required name=search_term_string\"}],\"inLanguage\":\"en-US\"},{\"@type\":\"Organization\",\"@id\":\"https:\/\/peronaccountants.com.au\/#organization\",\"name\":\"Peron Accountants\",\"url\":\"https:\/\/peronaccountants.com.au\/\",\"logo\":{\"@type\":\"ImageObject\",\"inLanguage\":\"en-US\",\"@id\":\"https:\/\/peronaccountants.com.au\/#\/schema\/logo\/image\/\",\"url\":\"https:\/\/peronaccountants.com.au\/app\/uploads\/Peron-Logo.png\",\"contentUrl\":\"https:\/\/peronaccountants.com.au\/app\/uploads\/Peron-Logo.png\",\"width\":500,\"height\":158,\"caption\":\"Peron Accountants\"},\"image\":{\"@id\":\"https:\/\/peronaccountants.com.au\/#\/schema\/logo\/image\/\"}},{\"@type\":\"Person\",\"@id\":\"https:\/\/peronaccountants.com.au\/#\/schema\/person\/2b80e2a8a723915f6320f9756c445a13\",\"name\":\"Charmaine Grant\",\"image\":{\"@type\":\"ImageObject\",\"inLanguage\":\"en-US\",\"@id\":\"https:\/\/peronaccountants.com.au\/#\/schema\/person\/image\/\",\"url\":\"https:\/\/secure.gravatar.com\/avatar\/5d275591d8b1574ce31a3b3270804f47?s=96&d=mm&r=g\",\"contentUrl\":\"https:\/\/secure.gravatar.com\/avatar\/5d275591d8b1574ce31a3b3270804f47?s=96&d=mm&r=g\",\"caption\":\"Charmaine Grant\"},\"sameAs\":[\"https:\/\/peronaccountants.com.au\"],\"url\":\"https:\/\/peronaccountants.com.au\/author\/charmaine\/\"}]}<\/script>\n<!-- \/ Yoast SEO Premium plugin. -->","yoast_head_json":{"title":"What are the risks of taking out a personal guarantee on a loan? - Peron Accountants","description":"Do you know the risks of offering a personal guarantee on a business loan? We\u2019ve outlined all the key risks to think about when entering into a loan agreement. #businessadvice #personalguarantees","robots":{"index":"index","follow":"follow","max-snippet":"max-snippet:-1","max-image-preview":"max-image-preview:large","max-video-preview":"max-video-preview:-1"},"canonical":"https:\/\/peronaccountants.com.au\/what-are-the-risks-of-taking-out-a-personal-guarantee-on-a-loan\/","og_locale":"en_US","og_type":"article","og_title":"What are the risks of taking out a personal guarantee on a loan?","og_description":"Do you know the risks of offering a personal guarantee on a business loan? We\u2019ve outlined all the key risks to think about when entering into a loan agreement. #businessadvice #personalguarantees","og_url":"https:\/\/peronaccountants.com.au\/what-are-the-risks-of-taking-out-a-personal-guarantee-on-a-loan\/","og_site_name":"Peron Accountants","article_published_time":"2023-05-04T07:29:47+00:00","og_image":[{"width":300,"height":200,"url":"https:\/\/peronaccountants.com.au\/app\/uploads\/lcphgxs7pww-300x200-1.jpg","type":"image\/jpeg"}],"author":"Charmaine Grant","twitter_card":"summary_large_image","twitter_misc":{"Written by":"Charmaine Grant","Est. reading time":"3 minutes"},"schema":{"@context":"https:\/\/schema.org","@graph":[{"@type":"Article","@id":"https:\/\/peronaccountants.com.au\/what-are-the-risks-of-taking-out-a-personal-guarantee-on-a-loan\/#article","isPartOf":{"@id":"https:\/\/peronaccountants.com.au\/what-are-the-risks-of-taking-out-a-personal-guarantee-on-a-loan\/"},"author":{"name":"Charmaine Grant","@id":"https:\/\/peronaccountants.com.au\/#\/schema\/person\/2b80e2a8a723915f6320f9756c445a13"},"headline":"What are the risks of taking out a personal guarantee on a loan?","datePublished":"2023-05-04T07:29:47+00:00","dateModified":"2023-05-04T07:29:47+00:00","mainEntityOfPage":{"@id":"https:\/\/peronaccountants.com.au\/what-are-the-risks-of-taking-out-a-personal-guarantee-on-a-loan\/"},"wordCount":447,"publisher":{"@id":"https:\/\/peronaccountants.com.au\/#organization"},"image":{"@id":"https:\/\/peronaccountants.com.au\/what-are-the-risks-of-taking-out-a-personal-guarantee-on-a-loan\/#primaryimage"},"thumbnailUrl":"https:\/\/peronaccountants.com.au\/app\/uploads\/lcphgxs7pww-300x200-1.jpg","articleSection":["Firm News"],"inLanguage":"en-US"},{"@type":"WebPage","@id":"https:\/\/peronaccountants.com.au\/what-are-the-risks-of-taking-out-a-personal-guarantee-on-a-loan\/","url":"https:\/\/peronaccountants.com.au\/what-are-the-risks-of-taking-out-a-personal-guarantee-on-a-loan\/","name":"What are the risks of taking out a personal guarantee on a loan? - Peron Accountants","isPartOf":{"@id":"https:\/\/peronaccountants.com.au\/#website"},"primaryImageOfPage":{"@id":"https:\/\/peronaccountants.com.au\/what-are-the-risks-of-taking-out-a-personal-guarantee-on-a-loan\/#primaryimage"},"image":{"@id":"https:\/\/peronaccountants.com.au\/what-are-the-risks-of-taking-out-a-personal-guarantee-on-a-loan\/#primaryimage"},"thumbnailUrl":"https:\/\/peronaccountants.com.au\/app\/uploads\/lcphgxs7pww-300x200-1.jpg","datePublished":"2023-05-04T07:29:47+00:00","dateModified":"2023-05-04T07:29:47+00:00","description":"Do you know the risks of offering a personal guarantee on a business loan? We\u2019ve outlined all the key risks to think about when entering into a loan agreement. #businessadvice #personalguarantees","breadcrumb":{"@id":"https:\/\/peronaccountants.com.au\/what-are-the-risks-of-taking-out-a-personal-guarantee-on-a-loan\/#breadcrumb"},"inLanguage":"en-US","potentialAction":[{"@type":"ReadAction","target":["https:\/\/peronaccountants.com.au\/what-are-the-risks-of-taking-out-a-personal-guarantee-on-a-loan\/"]}]},{"@type":"ImageObject","inLanguage":"en-US","@id":"https:\/\/peronaccountants.com.au\/what-are-the-risks-of-taking-out-a-personal-guarantee-on-a-loan\/#primaryimage","url":"https:\/\/peronaccountants.com.au\/app\/uploads\/lcphgxs7pww-300x200-1.jpg","contentUrl":"https:\/\/peronaccountants.com.au\/app\/uploads\/lcphgxs7pww-300x200-1.jpg","width":300,"height":200,"caption":"Lcphgxs7pww 300x200"},{"@type":"BreadcrumbList","@id":"https:\/\/peronaccountants.com.au\/what-are-the-risks-of-taking-out-a-personal-guarantee-on-a-loan\/#breadcrumb","itemListElement":[{"@type":"ListItem","position":1,"name":"Home","item":"https:\/\/peronaccountants.com.au\/"},{"@type":"ListItem","position":2,"name":"What are the risks of taking out a personal guarantee on a loan?"}]},{"@type":"WebSite","@id":"https:\/\/peronaccountants.com.au\/#website","url":"https:\/\/peronaccountants.com.au\/","name":"Peron Accountants","description":"Accountants in Rockingham","publisher":{"@id":"https:\/\/peronaccountants.com.au\/#organization"},"potentialAction":[{"@type":"SearchAction","target":{"@type":"EntryPoint","urlTemplate":"https:\/\/peronaccountants.com.au\/?s={search_term_string}"},"query-input":"required name=search_term_string"}],"inLanguage":"en-US"},{"@type":"Organization","@id":"https:\/\/peronaccountants.com.au\/#organization","name":"Peron Accountants","url":"https:\/\/peronaccountants.com.au\/","logo":{"@type":"ImageObject","inLanguage":"en-US","@id":"https:\/\/peronaccountants.com.au\/#\/schema\/logo\/image\/","url":"https:\/\/peronaccountants.com.au\/app\/uploads\/Peron-Logo.png","contentUrl":"https:\/\/peronaccountants.com.au\/app\/uploads\/Peron-Logo.png","width":500,"height":158,"caption":"Peron Accountants"},"image":{"@id":"https:\/\/peronaccountants.com.au\/#\/schema\/logo\/image\/"}},{"@type":"Person","@id":"https:\/\/peronaccountants.com.au\/#\/schema\/person\/2b80e2a8a723915f6320f9756c445a13","name":"Charmaine Grant","image":{"@type":"ImageObject","inLanguage":"en-US","@id":"https:\/\/peronaccountants.com.au\/#\/schema\/person\/image\/","url":"https:\/\/secure.gravatar.com\/avatar\/5d275591d8b1574ce31a3b3270804f47?s=96&d=mm&r=g","contentUrl":"https:\/\/secure.gravatar.com\/avatar\/5d275591d8b1574ce31a3b3270804f47?s=96&d=mm&r=g","caption":"Charmaine Grant"},"sameAs":["https:\/\/peronaccountants.com.au"],"url":"https:\/\/peronaccountants.com.au\/author\/charmaine\/"}]}},"jetpack_sharing_enabled":true,"jetpack_featured_media_url":"https:\/\/peronaccountants.com.au\/app\/uploads\/lcphgxs7pww-300x200-1.jpg","_links":{"self":[{"href":"https:\/\/peronaccountants.com.au\/wp-json\/wp\/v2\/posts\/13911"}],"collection":[{"href":"https:\/\/peronaccountants.com.au\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/peronaccountants.com.au\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/peronaccountants.com.au\/wp-json\/wp\/v2\/users\/13"}],"replies":[{"embeddable":true,"href":"https:\/\/peronaccountants.com.au\/wp-json\/wp\/v2\/comments?post=13911"}],"version-history":[{"count":1,"href":"https:\/\/peronaccountants.com.au\/wp-json\/wp\/v2\/posts\/13911\/revisions"}],"predecessor-version":[{"id":13914,"href":"https:\/\/peronaccountants.com.au\/wp-json\/wp\/v2\/posts\/13911\/revisions\/13914"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/peronaccountants.com.au\/wp-json\/wp\/v2\/media\/13913"}],"wp:attachment":[{"href":"https:\/\/peronaccountants.com.au\/wp-json\/wp\/v2\/media?parent=13911"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/peronaccountants.com.au\/wp-json\/wp\/v2\/categories?post=13911"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/peronaccountants.com.au\/wp-json\/wp\/v2\/tags?post=13911"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}