Growing: Personal Guarantees, then A, B, and C Pockets for an Entrepreneur's Family Assets

In the early 1980’s, serial entrepreneur Dick Fontaine and his wife Barbara faced difficult times when his bank called loans that Fontaine had personally guaranteed.

“I never dreamed (or chose not to acknowledge) that I was putting our entire net worth at risk.  I learned the hard way that personal guarantees put the guarantor at real risk.  Of course, I also didn’t foresee a 21% prime rate.”

After the bank called his business loans, Dick brought the family together for a conference.  His teen-age daughter was less worried about dinner next month than her fashion image, saying “This won’t affect my clothing budget, will it, Dad?” (more…)

2 Comments October 14, 2008