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Business Debt/Can I transfer personal gyarantees to other partners

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Expert: - 4/13/2011


Question
I am a partner in an S Corp that has decided to dissolve my interest in our company. We never officially signed a partnership agreement and have been operating for approximately a year. We have otstanding debt with various vendors that could be offset by receivables and assets if we collectively became solvent at this time. However, my other two equal partners have decided to carry on and continue their efforts. As a general manager of the corp, and in the absence of the other partners, I signed personal guarantees to vendors that supplied services to our company without my partners signatures... some oof which are still open accounts. My questions are as follows:
* Is it possible to transfer the personal guarantees on their behalf, if they concede to this?
* If this is not a possibility, is it possible to add them as a personal guarantee to the outstanding debt?

Thank you in advance for considering my questions and providing insight to these issues.

Answer
Buddy:
Thank you for your inquiry. Simply put, once personal guarantees are pledged by an individual, they are generally non-transferrable, unless it is a spouse, or co-guarantor or the primary guarantor is deceased. If you need to negotiate with your vendors to take less than what is owed (settlements) and make sure they release you from any further liability at that time.
As for adding guarantors, that may be difficult to do from the perspective of your partners, but I am sure your vendors would love to have more guarantors to go after in regards to the debt recovery. Be careful either way.

Respectfully,

Christine Janklow

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Christine Janklow

Expertise

As President of SettleSource,Inc. a business debt settlement firm, I invite you to inquire about all aspects of business debt solutions to best determine which may be most appropriate. If you have questions such as: What is debt settlement and how process provide debt relief to my business? What options are available to deal with my business debts? Is it possible for a business owner to negotiate their own settlements? Why is debt settlement preferable to filing a bankruptcy or debt consolidation? Why are creditors willing to provide settlements to a business? How will settling debts affect credit scores? or How to rebuild a business after debt is eliminated. Please ask it now! For more information regarding how debt settlement can help your business, please visit www.SettleSource.com and place your inquiry. Mention All Experts to have a confidential no cost consultation with Christine. If this is your business situation time may play a very important factor in getting matters resolved proactively before they have negative affects on the business.

Experience

My expertise is specific to providing business solutions that will have profound positive impacts on the financial health of businesses. I have 25 years experience as an entrepreneur and have developed national sales programs; strategic alliances; product development; marketing programs; business and turnaround plans and debt settlement programs all providing methods to improve the financial outlook for large and small businesses. In the area of commercial debt settlement I have over 10 years experience working with large and medium corporations and closely held businesses to enable successful debt reduction and turnaround. I am a professional debt arbitrator and have negotiated with major banking institutions as well as vendors, suppliers and other trade creditors.

Organizations
Provisors;Turnaround Management Association; Los Angeles area

Publications
Accounting Today; Web CPA; National Restauarant Association;Los Angeles Daily News; Today Magazine Monthly series of business articles entitled "Brand News."

Education/Credentials
Bachelor of Business Administration; Associate of Arts Merchandising

Past/Present Clients
American Airlines, American Express, Safeway Inc., New York Life, consumer products manufacturers; retailers, food service industry and other small businesses and service providers.

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