California Real Estate Lawyers BlogIn California, generally when a real estate buyer defaults on the loan and loses the property to foreclosure, the lender may not pursue a deficiency judgment against the borrower where the foreclosure sale proceeds are not enough to cover the amount of the debt. Lenders may go after loan guarantors for a deficiency judgment, but […]
Search Results for: Sham Guaranties
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The Sham Guaranty in California – How to Avoid By Making Sure There is Separation Beween the Borrowower & Guarantor
I have written in the past about Sham Guaranties – this is a guaranty of a loan where the guarantor has such a close identity with the borrower that they are in effect providing a guaranty of their own loan. Such a sham guaranty is not enforceable. A typical scenario would be with a limited […]
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The Sham Guaranty – where the guarantor shares a substantial identity with the borrower, the guaranty may be found invalid in California real estate loans.
A Loan Guaranty is a promise by the guarantor to pay the debt of another. In commercial real estate loans they are commonly used to provide additional security to the lender. Such loans are often given to new entities without a financial history, and the lender wants a person (with assets) on the hook for […]