Legal Question in Credit and Debt Law in New Jersey

Gurantee Valid?

Two years ago, I lent $245k @ 7% to a fellow .. His sister guaranteed the loan. She signed the promissory note as a guarantor and collateralized with a 2nd mortgage on her property.

The promissory note states that the Note can be changed with Borrowers and Lenders Consent.

A year later, some $125k was paid back and the balance of $120k was split up into 2 new notes. $60k @ 10% from the Fellow to me and another $60k from a third party to this fellow .. but assigned to me with the fellow being the backup guarantor.

Bad paperwork: The new notes do not connect with the old notes!

Additionally, The sister was not a signer to these 2 new notes .. nor was she consulted.

Now the 2 new notes are in default ..

Is the original guarantee still valid for me? Can I start the foreclosure proceedings?


Asked on 12/25/08, 4:20 am

1 Answer from Attorneys
John Corbett Corbett Law Firm LLC

Re: Gurantee Valid?

Your question cannot be answered without a review of the documents and knowledge of the circumstates surrounding the making of the new note. This matter could go either way. I suggest that you consult a business lawyer who is close to you and who can look over all the documents and give you specific advice.

See also: http://info.corbettlaw.net/lawguru.htm

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Answered on 12/26/08, 11:38 am


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