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Stuart J
Stuart J, Solicitor
Category: Law
Satisfied Customers: 23210
Experience:  Senior Partner at Berkson Wallace
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My husband guaranteed a loan for my brother's business

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Hi, My husband guaranteed a loan for my brother's business whilst he was a director. My brother's business was failing and he couldn't pay the loan so Funding Circle came after us for the money. My brother was negotiating with them at the time to pay less than he was paying but they came after us anyway. Is there anything we can do to get out of paying it?
JA: Where are you? It matters because laws vary by location.
Customer: Newbury, Berkshire UK
JA: What steps have you taken so far?
Customer: We have been paying the loan for the last year. We had to Funding Circle issued court papers so we paid someone to negotiate a lower monthly payment for us. The loan was £76,000 and the payments were £1600 per month We are now paying £853
JA: Anything else you want the Lawyer to know before I connect you?
Customer: I don't think so.

Hi, welcome to JustAnswer. My name is Jo C, I’m a barrister with 12 years of experience and I am happy to help with your question today.

Customer: replied 8 days ago.
Ok thanks
Customer: replied 8 days ago.
I would prefer to type thanks
Customer: replied 8 days ago.
So where do we stand?
Customer: replied 8 days ago.
Are you still there?

I have been asked to look at this for you.

Golden rule: never guarantee anything which you are not in total control of. Never guarantee anything unless you are prepared to pay back everything which the principal has borrowed. Too late now.

Getting out of personal guarantees is not a particularly easy job because the there was an easy way of getting out of it, there would be no point in having it in the first place.

There are a few arguments that you can use:


You didn’t take legal advice on the effect of it

you were pressured into it and didn’t realise the effect of it

it is a consumer contract under the provisions of the Consumer Credit Act you should have been given the right to cancel.

It depends whether they decide to take you to court over it but if they do, they will have to satisfy the court that they have pursued the principal debtor first and failed.

Your husband can of course pursue the brother if the brother has any money or house. If he has any equity in the house, that’s always a good one to go for.


If I have answered your question for you, at the top of the page, you should see a rating facility. Can you please rate my reply 3 stars or more because that really helps me? Please note you are not rating whether it’s favourable, because sometimes you may not get the answer you want, but basically my knowledge and way of dealing.

The thread does not close and I am happy to answer any questions you may have arising from this.

Kind regards

Customer: replied 8 days ago.
So are you saying that if they didn't pursue the principle debtor first we may have a case? They didn't pursue my brother at all!

That’s correct.There is case law on it which I have seen but it’s not a case which springs readily to mind.

What I would do is get a barrister’s opinion on the agreement and the circumstances surrounding because a lot of guarantees can be overturned. However it is very specialised and the opinion is going to cost you about GBP800 plus VAT. At least you will then know whether it’s worth arguing or not. The amount of money involved, I think it’s worth the investment. To be honest, even if you went to see a high-street solicitor they are likely to just refer it to a barrister for an opinion before they have the argument.

Customer: replied 8 days ago.
So how would I start looking for and finding a barrister?

If you Google “Find a barrister near me” it will come up with various chambers and you can choose one. Speak to the clerk (don’t be misled by the word clerk, the clerk manages the barristers and knows who does what) and asked who could give you an advice on this on a direct access basis (without a solicitor). Ask for an indication of the cost. Then, away you go.

Customer: replied 8 days ago.
Thank you so much. That has been really helpful! :)

You can also look on the Bar Council website but to be honest, I don’t find it as good as the Law Society website for finding solicitors.

I am glad to help. Please don’t forget to use the rating service because it means that can continue to provide affordable and timely legal advice to people with similar problems.
Although it says "rate to finish" it doesn't close the thread and we can still exchange emails.
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Kind regards


Stuart J, Solicitor
Category: Law
Satisfied Customers: 23210
Experience: Senior Partner at Berkson Wallace
Stuart J and 6 other Law Specialists are ready to help you