If someone structures a brand new business as and inc or llc, can the structure protect their personal liability for things such as equipment leases??ÿ For example, if ABC Surveying, Inc. signs an equipment lease for GPS robotics, etc, is the owners personal credit and assets at risk if the business folds?
Just a passing question, not geared towards any scenario I'm contemplating.?ÿ The discussion came up today at lunch as to why some companies are sole proprietor, llc, inc., etc.
I've owned both an LLC and a corporation.?ÿ All my equipment and major purchases (and insurance, etc.) have required a guarantor's signature (me).?ÿ I guess that's how "big-business finance" makes sure they've got a SSN to sue for non-payment.
Especially if you are a new company, lenders require a personal guarantee by principles of the business.
Once you have an established track record, the company may be able to accept debt without the personal guarantee required.?ÿ But again, a wise lender knows that the way to get the money would be from an individual.
Personal guarantee, even for company credit cards.
The banks want someone to go after, not an LLC, or Inc. they want a real person.