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I sold my half of business partnership 3 years ago, can I still be personally liable for unsecure line of credit

Asked over 2 years ago - Diamond Bar, CA

I sold my all my 50% share business to my business partner ( 50/50 ) 3 years ago due to illness.

I find out 3 month ago he used 35K of the 100K line of credit the company has with BOA...which I forgot to close when I sold him the company. I have great credit so all was applied using my name as primary. Both our names are on the credit line.

I was not informed when he try to use the credit line. I only find out because it showed on my online banking statement.

BOA said we have to paid the 35K to close it. They can not take my name out although I sold the co to him 3 years ago. No other options. He is not able to pay up the 35K to close it right away.

What can I do to protect myself in case he goes bad? What can I do to stop the other 65K from being used.

Please help. Thanks!

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Attorney answers (1)

Steven Alan Fink

Reputation Level 20

Answered over 2 years ago. Real Estate Attorney in Newport Beach, CA.

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One easy way to prevent balance from being used is to take out $50,000. That leaves him to use his half. Another way is for you to pay the $35,000 and have him give you a note for $35,000. Then you can close the line.

The response given is not intended to create, nor does it create an ongoing duty to respond to questions. The response does not form an attorney-client relationship, nor is it intended to be anything other than the educated opinion of the author. It should not be relied upon as legal advice. The response given is based upon the limited facts provided by the person asking the question. To the extent additional or different facts exist, the response might possibly change.

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