How to Investigate Personal Guarantors' Business Loans
Investigating a personal guarantor's personal business loans is not as difficult in the information age as it once was. Now simply having access to the Internet and some databases will offer a fairly complete portrait of the guarantor and his or her situation and suitability to guarantee.
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Instructions
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Search the three main credit bureaus (Exquifax, Experian and Transunion) for the guarantor to see what is on her report. The three main bureaus offer reports on businesses and individuals and gather the information from various creditors, so they may have some overlap and one may have more information than the others. If the guarantor has a business, your form should ask the names of all businesses she operates and the legal status of each.
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Request a Commercial Credit Report from each of the credit bureaus on the names of the businesses given for the guarantor. The reports may or may not have more information than the personal reports depending upon the legal status of the businesses. If they are sole proprietorships, then the businesses will all have the same report as the individual. If they are corporations of some type, then they will have different information.
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Request a commercial credit report on the guarantor and his companies from a Commercial Credit reporting company (such as Dun & Bradstreet or Microbilt). These companies will show what creditors are reporting on the guarantor and will give you some idea how he pay his bills.
Some loan information may be present if there is security on the loan, as this is public record information. These sorts of reports can be expensive, but depending upon the size of the loan in question, may well be worth the price you have to pay.
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Review all the credit reports to see if the guarantor has been sued by past or present creditors. One lawsuit might be explained away as a dispute, but if there are several it be that the guarantor has difficulties keeping to agreements with other creditors.
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Tips & Warnings
Make sure your documents are reviewed by a lawyer familiar with your state's laws to ensure they will stand up in court. There is little reason to have a guarantor if your documents will not compel him or her to pay if the original debtor defaults.
If you need legal advice, seek out a qualified lawyer.
