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Many directors of small businesses often need to provide a personal guarantee for business loans, as required by most major banks and non-bank lenders. This means that if the business fails to make loan payments, the directors may have to cover the debt, potentially risking their personal assets. It's essential to recognize that personal and business finances are closely linked for small business owners, making such guarantees common. However, signing a director's guarantee has legal implications; lenders can pursue individual directors or all collectively, even if multiple directors sign the document. Understanding these consequences is crucial before signing.