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Aug 6th, 2022
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How to Organize Pages Personal/Corporate Guarantee

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Hello friends very warm welcome to uh easy GST for you I am your host Girish Kulkarni and today we are going to discuss another important uh and interesting aspect of Bank guarantees or guarantees in particular we know that in any case of borrowings nowadays guarantee is a common procedural part that is followed by most of the financial institutes including Banks and bfcs Etc so what is the the treatment of such guarantees as far as the provisions of GST law are concerned uh that we are going to discuss in this particular video so whether the guarantees those are usually given by holding company for borrowings of subsidiary company or maybe the directors of a private limited to that particular of the for the borrowings of that particular private limited company whether those are treated as taxable transactions in GST regime so that is the question under consideration so we know that in GST Supply is a taxable event and to qualify something as a supply there are certain parameters whic

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Corporate credit cards that are issued to an individual are another example of a personal guarantee. The individual or employee is responsible for the debt that the organization takes on and the overall spending on the credit card. Here, the cardholder takes the role of a guarantor.
When someone personally guarantees a loan and the loan goes into default, the lender can sue them and hold them personally liable for any unpaid loan balance remaining after any specific collateral securing the loan is foreclosed and sold.
How to Limit a Personal Guarantee Refuse to sign or simply cross out the guarantee language. Define when the personal guarantee would go into effect. Decrease personal guarantee with improved business performance or passage of time. Limit a guarantee. Revoke old guarantees. Suggest terms of relief.
The difference between corporate and personal guarantors is quite simple: a personal guarantor is an individual who agrees to take on the obligations of a debt for a debtor, whereas a corporate guarantor is a corporation that takes on payment responsibilities.
A personal guarantee can be enforced the same way as any debt. If the business owner does not pay, the creditor can bring a lawsuit to receive a judgment and levy the owners personal assets to cover the debt. The exact terms of a personal guarantee specify a creditors options under the guarantee.
If you manage to come out of the situation, you must have a discharge letter from the bank stating that you are no longer liable for the outstanding amount as on the date when your guarantee has been revoked. In such cases you may actually get away with a unscathed Cibil score.
With an unlimited personal guarantee, you authorize the lender to collect on 100% of the loan amount and usually any legal fees that arise from your failure to pay. In other words, the lender could collect on personal assets, such as your home, vacation homes, saving accounts, cars and retirement funds.
By agreeing to a personal guarantee, the business borrower is agreeing to be 100 percent personally responsible for repayment of the entire loan amount, in addition to any collection, legal, or other costs related to the loan.

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