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    2 Replies Latest reply on Dec 20, 2009 9:39 AM by phanio

    Avoiding a personal guarantee....

    mdviking Newbie

      My partners and I are in the process of opening a restaurant franchise.
      • The franchise start-up costs are $600M-$800M if we obtain a multi-year lease
      • And they are $1.5M-$2M if we purchase and improve our own structure
      • We have $400K cash available to put towards the franchise
      My question can we avoid a personal guarantee? We willing to put our initial $400K cash at risk to launch the franchise. But we do not want to put any additional assets at risk (ex: house, retirement savings, etc...)

      I've read that we may be able to put a cap on the personal guarantee limit. So far, we haven't met with much success doing this.

      Does anybody have any other tips on how to negotiate a small business loan that avoids the personal guarantee?