“A fraudulent transfer lawsuit is based on a claim, and the claim is said to arise in this context when the personal guarantee is entered into, and not when the underlying deal goes into default.”
When a lender requires a personal guaranty, best to know what YOU are signing up for! Read a good article below on this. The author discusses personal guarantees in the context of real estate developers, but these guarantees can be – and more often than not are – required for all types of loans.
If you’re signing a personal guaranty, understand that YOU are on the hook, personally. There’s no way out if things go South. Oftentimes, you can’t avoid having to enter into a personal guaranty, but you can be better informed about what you’re getting into. Look before you leap!