Independent Banking Advisory Service 

Personal Guarantee, Personal Guarantees and Director's Personal Guarantees

Bank demanding payment of your personal guarantee? Have concerns regarding your own position with a Director's Personal Guarantee Demand? Or aware that the Personal Guarantee you signed will become a banking debt? Financial Ombudsman Complaint?

The current practice (for all banks) chasing a Personal Guarantee demand debt is that their debt recovery units obtain by any means possible a signed asset/expenditure form or personal financial statement. This is now obtained by banks immediately at or after demand has been made on a Personal Guarantee. A signed form of that nature will provide the bank with their first 'counter' to any possible defence/s to their claim. Signing any financial disclosure or providing the bank with such personal information will often destroy any later attempt by the customer (or indeed anyone else) to negotiate the debt or defend the claim on the Personal Guarantee. Some bank debt recovery officers are telephoning customer's immediately after demand and their priority is to immediately obtain payment proposals - so they can enforce the debt legally and quickly to their advantage. Enforcement inevitably means 'pressure' on the family home.

If you've received a bank personal guarantee demand for payment - contact IBAS today- don't wait until the bank increases their pressure. An email to us is the quickest way to obtain our response and our help - tell us which bank your demand is from and the outline of the issues and we will respond to you quickly. IBAS early help and advice on Director's Personal Guarantees, Personal Guarantee debt claims, Bank Guarantees, Bank Joint & Several Personal Guarantees, Director's Personal guarantee and Indemnity, Personal Guarantees for SFLGS - prevents the increased risk of losing your home.

Those being chased for a current Director's Personal Guarantee demand may be interested to read what IBAS CEO wrote for 'Your Business' in September 1994

IBAS is the most experienced organization in this field with 20 years 'track record' in Banking cases and resolving Director's Personal Guarantee issues. Our aim is to provide the best professional and personal Banking and Personal Guarantee advice service to protect our members at a low and affordable annual membership. IBAS offers specialist and individual Banking and Personal Guarantee advice and assistance and will assess your personal position to establish how your banking dispute or Personal Guarantee may impact upon you and also your family. Our first action is always to protect your personal position and prevent it being compromised further, by any ill advised actions with regard to the banking dispute or Personal Guarantee you have already signed. This we do with all our members, including the many professional and corporate members, where their Banking dispute and Personal Guarantees may also impact on their future position and employment prospects.

You will find our 2012 national newspaper comments (plus many more over many years in the News and archives sections of our site) - these show that IBAS can be relied upon and has been in existence helping business bank customers with their personal guarantees and Director's personal guarantees debt claims and demands since 1992.

What does IBAS membership offer you?

Example 1: The following statement was posted by one of our past members: "The fact that IBAS have the knowledge and provide assistance in formulating the strategy, which was provided to me under membership and which provided the necessary case law ammunition and support (letters continually making the correct points) to prevent the bank gaining the upper hand (preventing me making offers which I wanted to make, just to get this case against me closed, and which would have destroyed any defence) - that strength of position then also enabled me to 'face off' the bank's threat (although the bank/solicitors knew their claim was flawed) and this strength of resistance then forced them to discontinue their action - this is all a matter of fact and something which IBAS should be very pleased about."& "I understand that so many cases are lost before they start because under threats from the bank the customer provides an offer of payment - without understanding there may be a defence to the bank's claim. Having been induced to make that offer, the bank then goes for the jugular. Apparently I am one of a very small band of successful litigants, which I wouldn’t have been without IBAS behind me." This case illustrates how dangerous Director's Personal Guarantees are for those who have signed them. It illustrates how IBAS guides those with Personal Guarantees where each case 'turns on' it's own facts and information. Telephone advice sought or taken at the time of a 'call' by the bank on the Personal Guarantee should be avoided at all cost.

Example 2: Mr A’s Father in law (Jack) wanted to help in Mr A's business - so the bank sought a personal guarantee from Jack and also his wife Judy for a guarantee of 40k. The guarantees was secured on Jack & Judy’s house as the bank requested. The bank lent up to the limits of the overdraft agreement with Mr A and often beyond it. Jack and Judy did not work for Mr A’s business and had no control over the business borrowings. Mr A then left their daughter and divorce coincided with business failure. The bank issued a formal demand to Jack & Judy for 40k plus interest, plus costs. Mr A had considerable debt and his unsecured creditors petitioned for his bankruptcy. There was a considerable sum also left outstanding to the bank. As the bank had obtained guarantees with security it meant that Jack & Judy were facing a 40k plus debt to the bank - after Mr A’s bankruptcy.

The bank requested payment but didn’t ‘push’ for repayment and Jack & Judy thought the bank had just ‘gone away’. However, some ten years later Jack & Judy wanted to plan an anniversary party and an overseas holiday. They applied for a remortgage on their home. That immediately prompted a demand  for full payment from the bank. The debt was considerably more than 40k and secured under the bank’s mortgage. The bank was now less ‘friendly’ - and added interest for the 10 year period and threatened legal to obtain full payment. Under IBAS advice the guarantors waited until a suitable opportunity presented itself for us to negotiate the debt and release the security held by the bank. Our advice resulted in a favourable settlement for the bank customer. The moral from this story is that Banks do not just 'go away'.

Many guarantors seek our assistance, realizing their personal position is at serious risk from an undetermined guarantee. Unfortunately, by responding to the bank's first letter or by telephoning the bank after it's receipt can destroy any possible defences. It's not unusual for those facing PG claims to attempt negotiations with the bank themselves but through lack of knowledge they then become fully liable for the debt claimed. Often, this is because they've used inaccurate 'advice' from web sites and forums in attempting to 'defend' the PG claim themselves. It is impossible for an individual faced with a personal guarantee debt claim to compare their situation with another but IBAS is dealing with such matters daily and is able to advise based on each individual bank's current attitude and motivation. We will also know from recent cases whether your home is more at risk from the bank's personal guarantee demand for payment.

Think your personal guarantee is not going to affect your home and assets? Is your personal guarantee valid or think your personal guarantee is invalid? Seeking advice on contesting the validity of a personal guarantee call?

Mail IBAS today for help-

Independent Banking Advisory Service (IBAS) is a national, independent, non-profit, unique specialist banking customer membership organization which resolves banking complaints and disputes and which has campaigned on UK Banking issues since 1992. We provide bank and business banking assessment, analysis, bank comment and content for BBC TV News, ITV, Radio and national newspapers.