Lease- Guarantee

[RBHII]

Is it normal for the buyer to have to personally guarantee the lease when buying a mat? Is there anyone out there that would have any concerns with such a situation/requirement?

[Ken]

No lease,no deal!
This should be the one of most important thing when you buy a store.
If the buyer won't do that,no deal.
Only fool will buy store then talk about lease!

[JBTcajun]

To personally guarantee the lease or not is a personal decision you have to make. You can't blame them for asking.

[Gary C]

It would not bother me. The reason most of the time is if a corp is renting or buying then all you have to do is close and the owner has no recourse. Not a big deal for the most part to sign.

Gary

[RBHII]

Thanks, I realize it's a personal decision....I would think most landlords ask for it.....I wonder if a way to counter the risk involved is to ask for more options, as fewer years per options, ie instead of 3 5 year options, ask for 5 3 year options....the old "just in case" backup, you'd have fewer years if things went south.

Have most people out there guaranteed personally for their stores?

[MyLaundry]

Lease or loan, the landlord or the bank always ask me to personally guarantee the obligations of my corporation under those instrument. There is no way out.

[MrsNewMat]

When I was buying, I was told that it's common to personally guarantee it so I did.

I got the lease for ten years…..ten years is a loooong time. I wish I had known about options…that could have been my way out.

If things don’t go as planned, lease is the only MAJOR thing that could come after you.

[Anonymous]

You might try to limit the $$$ amount or time frame that you have to guarantee the lease.

In one case, my guarantee expires after 24 months.

[pete f]

Landlords will attach anything they can. Weather or not it would be enforced is another question. My first mat I had to not only sign a personal gaurantee, but also give up my homestead rights to the landlord. In Florida, the one thing that is protected by law is your house, and the only one who can take it would be your bank. It is protection for widows and orpahans, so to speak. I had to sign off on it. I was not to happy, but what does ones do? About 5 years later I bought a building across the street and moved. I hated that SOB. In the end, I should send him a thank you card, it was one of the best business deals I ever made.....so don't worry about personal gauarantee, it comes with the cost of doing business.

[CharlieS]

3 Mats, 2 personal guarantees on the leases.

Charlie