Commercial leases are usually for longer terms than residential leases, often 3 - 7 years. Most landlords seek to obtain personal guarantees of these leases from people involved with the business or their relatives. Great care should be taken in signing such guarantees as the liability to the guarantor is often unlimited. If you are being asked to sign a guaranty of a commercial lease, you may be able to negotiate to lessen the negative financial consequences if the lease does not get paid. Limiting the guaranty either to amount and/or duration is key. If you are considering signing a guaranty of a commercial lease, give us a call to discuss first.
