Exposing Hidden Risks: When PG Exposure Threatens Your Family’s Financial Security

This case study underscores the broader impact that business debt has on entire families, particularly where personal guarantee exposure is prevalent. 

“Personal Guarantee Advice”…that’s exactly what our client had typed into Google to find Bell & Company. He liked the fact that we offered a tailored strategy for each case and opted for a free initial case review. The client was extremely concerned during his case review as his limited company had just entered administration, the main element of concern was the personal guarantees our client had signed, along with his business partner, and his elderly relatives who were his guarantors. The total liability amounted to £122,000.

The Challenges

When a business enters administration, any personal guarantees associated with its debts are typically called in by creditors. This means that the guarantors are legally obliged to fulfil the debt obligations of the insolvent entity. In this case, the administration triggered the personal guarantees signed by our client, their business partner, and the client’s elderly relatives, exposing them to significant financial liability.

The involvement of the client’s elderly relatives posed a unique challenge. Their advanced age and substantial personal assets heightened the stakes, as their financial security was jeopardised. This situation illustrated the profound and often distressing impact that insolvency can have on the guarantors’ personal lives, extending beyond the direct stakeholders of the business.

Our Approach

Recognising the dire situation, our primary focus was on safeguarding the financial wellbeing of the client’s elderly relatives.

We explored several strategies to mitigate their risk, through a rigorous examination of the loan application process, we uncovered significant flaws in the creditor’s due diligence, especially regarding the aforementioned guarantees of the client’s relatives. By exposing these irregularities, we successfully negotiated a settlement of £75,000, resulting in a saving of £47,000. Our unwavering determination and compelling evidence were instrumental in achieving this outcome.

Conclusion

Without our intervention, the client, their relatives and his business partner faced the very real threat of bankruptcy. The successful resolution brought immense relief and gratitude to the client.

This case emphasises the crucial role of expert legal counsel in overcoming complex financial challenges. By identifying weaknesses in the lender’s practices and employing skilled negotiation tactics, we secured a favourable result for our clients and prevented catastrophic financial consequences, for several people.

If you or anyone you know is facing financial challenges due to business insolvency and/or personal guarantee exposure, don’t navigate these complex matters alone. Contact us today for a comprehensive case review, as each situation is unique and requires a tailored strategy.

Our team of specialists are here to provide the guidance and support you need to safeguard the things that matter most. Reach out to us today for a free confidential case review and discover the best path forward for your specific circumstances.

Get in Touch

If you or anyone you know is struggling with a difficult financial issue, please don’t hesitate to reach out to our specialist team. We offer impartial, tailored advice alongside a free initial case review. Call us today on 03333054331 or send us an email at [email protected]