What happens when I default on my lease?

[nikevision]

What is the name of your state? CA

I opened a small business in a retail office space and signed a 5 year commercial lease under my LLC but also signed a personal guarantor. I need to close my store for good but I still have 3 years left on my lease.

My landlord won't terminate the lease early. His PM told me to find a new tenant. I'm currently doing so, but can't afford to pay next months rent without a business now.

What is the worse that my landlord can do to me? Will this show up on my credit report even if its under my LLC? If I just bankrupt on my LLC will that show up on my credit report?

Since I signed the personal guarantor... can my landlord come after my personal assets like my car and home?

Should I still pay the rent? The PM sounded like they wouldn't help me find a new tenant. So I thought if I didn't pay them rent, they would be more motivated to find a new tenant.

Help!

 

[Cvillecpm]

Try HARDER to find new tenant....yes, your personal guarantee allows LL to sue you PERSONALLY and any judgement will attached to your real estate and your credit for 10 years.

 

[moburkes]

What is the name of your state? CA

I opened a small business in a retail office space and signed a 5 year commercial lease under my LLC but also signed a personal guarantor. I need to close my store for good but I still have 3 years left on my lease.

OK.

My landlord won't terminate the lease early.

He's not required to.

His PM told me to find a new tenant. I'm currently doing so, but can't afford to pay next months rent without a business now.

That was a good suggestion by him.

What is the worse that my landlord can do to me? Will this show up on my credit report even if its under my LLC? If I just bankrupt on my LLC will that show up on my credit report?

Sue you personally. Get the judgment added to your credit report. BKing the business won't remove the personal guarantee.

Since I signed the personal guarantor... can my landlord come after my personal assets like my car and home?

Well, not unless he gets the judgment against you.

Should I still pay the rent? The PM sounded like they wouldn't help me find a new tenant. So I thought if I didn't pay them rent, they would be more motivated to find a new tenant.

Help!

That would be your best bet. However, they are required to mitigate their damages by advertising for a new tenant. You would be responsible for their costs to acquire the tenant, and the rent until the tenant moves in.

 

[Cvillecpm]

"Should I still pay the rent? The PM sounded like they wouldn't help me find a new tenant. So I thought if I didn't pay them rent, they would be more motivated to find a new tenant."


THEY don't need a new tenant - they have your PERSONAL guarantee and the FIRST monies they collect from a new tenant will be for THEIR FEES - not applied to your rent.