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  • Property-a-holics

    Deeds of guarantor - how likely is it?

    I’ve recently bought two properties to refurb and for each one the lender wanted me to sign a deed of guarantor. I had to get a different solicitor to advise me as mine only represented my LTD co. I ended up paying £250 x2 for a quick meeting where the solicitor basically told me that it was close to impossible for the lender to pursue me if things came unstuck. 
    I don’t plan on that happening but just wanted to know how enforceable these things are?
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    Without reading THOSE particular guarantee deeds and know how good your & the lender's solicitor's are & their expertise in this area, no point in even guessing.


    But many would suspect lender's solicitors will be good & expert. Let  us know when the court case concludes!

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    I've seen numerous personal guarantees (PG) enforced. If you borrowed personally you would be liable and lenders make limited company BTL decisions on the person first and company second, hence the need for a PG.

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    Regards Simon Searchlight Finance

    Fulfil Your Property Ambitions

    01565 654005

    Searchlight Finance Ltd is authorised and regulated by the Financial Conduct Authority reference 743220.

    HMO Finance I Complex BTL I Bridging Finance I Development Finance

    Buy to Let I Portfolio Finance I Commercial Mortgages


    Thanks- I understand that but how likely would it be for them to take our residential property? I understand that they would repossess the houses but would they go to those lengths?
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    With a PG if you default lenders could take all your assets (or just enough to satisfy what is owing)  - hence the cliché which alludes to a PG as "an idiot with a pen".

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    Simple answer is yes if its worth their while they will take your assets.

    I personally know someone who was taken under a PG by Barclays for £220k. Barclays won.

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    If it looked like it was going to go pear shaped I was thinking I could transfer our house, which is only in my name over into my wife’s to prevent them from getting their hands on it. This is all very much worst case scenarios of course! Not sure if that would be an option?
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    You are getting into a very legal area so wouldnt say for sure.

    All i do know is those sorts of transcations can and have been unwound by the courts in the interests of creditors.
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