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Buachaill, Lawyer
Category: Republic of Ireland Law
Satisfied Customers: 10539
Experience:  Barrister 17 years experience
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With regard to a person being a “consumer” under the Consumer

Customer Question

With regard to a person being a “consumer” under the Consumer Credit Act 1995, would such a person survive this if they personally guaranteed a limited company business loan to a bank for a friend, where the guarantor was not a party to the loan, was not involved, or had no connection whatsoever with the business activity on the limited company, but was just a mere guarantor on the loan?
Submitted: 2 years ago.
Category: Republic of Ireland Law
Expert:  Buachaill replied 2 years ago.
1. I regret to say that if someone is guaranteeing a business loan, then they would not fall within the category of "consumer" within the 1995 Consumer Credit Act. Under the scheme of the act, there is a sharp division between consumers and business dealings. Someone who is signing and guaranteeing a business loan is engaging in some form of business even if they don't dirty their hands with the loan or the business activity. They are never a consumer. Consumers must be acting other than in the course of business. Where a business loan is concerned, you cannot classify someone as a consumer as the risk they are taking involves a business risk, namely the non payment of the business loan. Guaranteeing the risk on a business loan is not the activity of a consumer.