How JustAnswer Works:
  • Ask an Expert
    Experts are full of valuable knowledge and are ready to help with any question. Credentials confirmed by a Fortune 500 verification firm.
  • Get a Professional Answer
    Via email, text message, or notification as you wait on our site.
    Ask follow up questions if you need to.
  • 100% Satisfaction Guarantee
    Rate the answer you receive.
Ask CalAttorney2 Your Own Question
CalAttorney2
CalAttorney2, Attorney
Category: Legal
Satisfied Customers: 10238
Experience:  Civil litigation attorney for individuals and businesses.
71563194
Type Your Legal Question Here...
CalAttorney2 is online now
A new question is answered every 9 seconds

We had formed an llc partnership. The loan we took out was

Customer Question

We had formed an llc partnership. The loan we took out was originally signed by both partners. When we refinanced, we paid half of the loan off and the remainder was collateralized with business assests only and only with my signature. Not personal property. I had to file bankruptcy. Now the bank 3 years later is going after my partner that never signed the note but was listed on the refinance. Do they have anyway of collecting when they refused the assests when we closed and only collateral listed was the business assets?
Submitted: 1 year ago.
Category: Legal
Expert:  CalAttorney2 replied 1 year ago.
You have a rather unusual situation. Generally lenders are very careful in ensuring that all owners of small LLCs or s-corps sign as personal guarantors of loans and refinances.To get the answer to your question you are going to need to very carefully review all of the documentation associated with the refinance to determine whether the refinance created an entire new loan (in which case your partner would no longer be liable), or if it simply created new terms for the old loan (in which case your partner's liability would still carry through).Your partner may wish to retain an attorney to review the loan docs on his behalf - even if there is no liability, having a lawyer review the documents and provide an opinion, combined with a firm letter to the bank regarding his position may be helpful (a lawyer doesn't give your partner any additional legal rights, but it can help him more fully assert those rights, and particularly in a negotiations or bargaining position, having a lawyer can greatly increase his bargaining power).