Possible business loan default

[netfreeadvice]

What is the name of your state? MA

I have a situation that I hope someone can help me.

My wife and a friend started a company (LLC) selling stuff online 4 years ago. The ownership was 50/50. They got a business loan of $80K. They signed personal guarantee. The spouse (including me) didn't sign anything. 2 years ago, my wife "sold" her shares to the friend. The friend gave my wife a document that she would assume the business loan. They didn't tell the bank fearing that the bank would call back the loan and the business transfer would not go through. 1 year ago, the friend decided to shut down the business and sold off the inventory. She and her husband have since moved abroad; they don't have any asset in US any more. She currently has 10K left with 50K remaining in the loan. She has been paying off the monthly loan payment. But it won't be long before she doesn't have any money left to pay off the loan. According to her, her lawyer said that the bank might forgo the loan if the remaining loan was not too big. She hasn't told us that she is planning to default on the loan. And my wife has not asked her the question directly.

I am a US citizen, but my wife is not a US citizen nor a resident. I have a 401K and all our money are in my accounts. So my question is, if and when the friend has decided to default on the loan, can the bank go after me?

Any comment is much appreciated.

 

[CraigFL]

Since you and your wife were married at the time of the personal guarantee, both you and she are 100% responsible for the debt. It is unlikely that the bank will "forgive" the balance since you and she will be easy targets to come after to get the rest of the payments. If you do have a document from the other partner saying that they are responsible for the balance of the loan, your recourse will be to sue her to recover the money you had to pay to the bank. But of course the problem will be she is not in the US...