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About Michael Fay
Expertise
My focus and specialty is in credit, so that the risk of the debt itself is minimized. This means understanding it, predicting it, and helping to correct it. Having worked in contracts & credit, I have also worked with all of the related documents such as Guarantees (personal and corporate), and Security Agreements (aka UCC’s or “liens” – but I caution you in using those interchangeably).

Experience
I have a broad background with more than 15 years in the credit industry. Ten years with Dun and Bradstreet, first as a field reporter creating reports, then in customer service, finally I served as the credit manager designing risk models for many national and international customers through D&B’s Outsourcing function. Five years with another publicly traded firm where I created the credit department and then served as credit manager for North America. At both companies we used both business and consumer data. You probably know that both business and personal credit have scores; what you might not know is how many different types of scores there are. I am familiar with and have used many different scores in each. Also be aware that each credit type (business & personal) is unique with different processes and different time frames. I have served on the board of directors for companies in many states and still serve in some capacity in a few. I contribute to credit publications and work with the non-profit arm of the SBA called SCORE.

Organizations
ACA International * NACM * Credit Risk Managers * SCORE (SBA)- Counselors to America’s Small Business * Payment Card Industry Network * PaymentSource.com * D&B Alumni * Psi Chi, National Honor Society for Psychologists

Education/Credentials
BIS in Business and Psychology, University of Minnesota * MBA is still in progress (on-line)

Awards and Honors
State of Colorado - State finals in Accounting and Advanced Accounting. * D&B Leadership Winner (3 times) * D&B Leadership Finalist (3 times) *

You are here: Experts > Business > Small Business Information > Business Debt > Settlement of Personally Guaranteed S corp Line of Credit

Business Debt - Settlement of Personally Guaranteed S corp Line of Credit

Expert: Michael Fay - 10/30/2009

Question
I am part owner of an S corp that has a business line of credit which I signed a personal guarantee. I understand that if it goes into default that I am liable. I am going to wind the company down over the coming months and apply everything received for the remaining assets towards paying down the line of credit....My question is if I negotiate a settlement with the bank on the line of credit which is not in default...will it affect my personal credit?

Answer
Rus-
The answer depends on whether or not the bank chooses to report the personal credit aspects and if they do, how they choose to report it. Once you negotiate with the bank (or even before you start as a means to help you as you negotiate), I suggest that you speak to someone who specializes in personal credit to better understand what those options are and the impact they might have - Personal credit is not my area of specialty.

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