Here is a common scene-
- You lease a building to a Tenant. (Let’s call the tenant “No Capital, LLC”)
- It is a 15-year lease. $5,000/month rent.
- No Capital, LLC pays you for 8 months and no payment ever comes again.
- You send an aggressive notice to No Capital, LLC telling them they are in default and you are requiring (as the lease provides) the payment of all rent due under the lease + expenses.
- No Capital, LLC files bankruptcy and you receive $0. The Company had no money.
You would be in a drastically different position if you required the owner of No Capital, LLC to sign an individual guaranty which required him to pay the rent and fulfill the lease if his company did not.
Please get an individual guaranty signed the next time you lease to a Company.
Excited to see you thrive –
~ The Allen Firm team | Your Legal Guides
PS. Thank you for allowing us to guide you in your legal matters.