I will be a personal Guarantor on a business loan and I am concerned about my declaration of homestead rights.

Asked over 3 years ago - West Springfield, MA

My wife is on homestead and not on business loan. I have homestead declaration in Mass.

Additional information

I am curious if a creditor is allowed to ask for a waiver of homestead on a loan other than a mortgage for said property.

Attorney answers (2)

  1. Theodore Lyons Araujo

    Pro

    Contributor Level 20

    Answered . What are you worried about (i.e. what is your question)? You have personal liability for the business loan if you gaurantee it, just like any loan, and you are correct that there are exemptions if they try and collect a judgment or you file bankruptcy.

    Disclaimer: This answer does not constitute legal advice. I am admitted in the States of New York, New Jersey and... more
  2. Herbert Weinberg

    Pro

    Contributor Level 12

    Answered . The steps you have taken are likely to keep your house but it may not and if you are the one in ten who is not protected, it will be no comfort to you that while you lost your house, nine other people in your position did not lose their house. There are many potential issues that you need to keep in mind. First and foremost,how much is your house worth as a homestead only protects $500,000 of equity. Second, if your wife were to unfortunately die, you become the sole owner of the house. Third, is the lender having you give a mortgage along with the guarantee? Fourth, do any loan documents seek to have you waive your homestead? I have seen too many people sign personal guarantees and not realize the consequences.

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Debt

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