In a recent court case that saw Bestival co-founder DJ Rob da Bank defending TicketLine Network’s £650,000 claim, Helen Young looked at the issues that arise when companies with financial difficulties borrow to try to save themselves. Helen’s column was published on Elite Business and can be read here.
If a limited company takes out a loan in its name it is liable to the lender, not its directors. Many lenders won’t lend to limited companies without security and insist on personal guarantees that kick-in if the company fails to pay or becomes insolvent. A director who opts to borrow in their own name if their company can’t raise funds is undoubtedly taking a risk.
For help and advice on taking out a director’s personal loan on behalf of your business, please contact Helen Young by emailing firstname.lastname@example.org or calling 01727 798068.