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DISCHARGE OF PERSONAL GUARANTEE IN CHAPTER 13

Posted: Fri Jul 27, 2012 9:56 am
by Yahoo Bot

First, after reading Jay Fleischman's post, I felt badly about leaning on the list serve and its members without first introducing myself. So please allow me, by way of introduction, to say that I recently moved out here from Las Vegas after practicing as debtors' counsel there for 23 years. I have set up shop in Torrance and hope to build a much smaller practice to take me into my retirement years. What can I say - we wanted to move to the beach before we were too old to enjoy it! So far, so good - thanks to many of you.
That said, I have researched this issue a number of times and have not been able to find an answer. I was hoping perhaps someone could point me to a case. In 2011 a client was disharged from a chapter 13 case. He had listed in that case a guarantee of a commercial mortgage. The property is in Nevada, a recourse state. The plan accurately provided that the debt came due beyond the plan term and the monthly payments would be made by the third party obligor (the debtor's solely held, small corporation). The corporation is now insolvent and the property is grossly underwater. Client now wants to let the let the property go back to the bank but is concerned that he may be sued on the guarantee. I believe that the personal guarantee was discharged in the 13, but cannot find any case law to support my position. Does anyone have experience with this?

The post was migrated from Yahoo.