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samontop2 · Joined: 28 Sep 2009 Posts: 1 1.33 Dollars($)

My business partner is seeking to refinance an existing mortgage. They are the majority stock owner in the company for which the present mortgage is outstanding. My partner has made an offer to buy my shares, but would like to keep the existing mortgage and borrow the money through a loan to pay me off. If my name is on the first mortgage, can my partner borrow money and obligate me to be responsible for the additional loan? They have agreed to indemnify me against failure if they fail to successfully pay off the existing loan. The existing loan matures in may 2011.

sara · Posted: Tue Sep 29, 2009 3:12 am Post subject:

Hi samontop,

It doesn't seem to be a good idea to me. Your business partner would be taking a loan in your name in order to pay you. In case, he fails to pay off the loan, the lender would consider you responsible for it and would sue you for it. Moreover, it is your credit that would be affected if your business partner does not pay the dues. You can ask your business partner to take the loan in his name and pay you.

Take care.

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