I own a small business which is an S Corp. Business was bad for awhile, during which time I got behind on the mortgage on my personal home. The home is now in foreclosure. Currently, I a considering an offer of a short sale, and I ade the decision to save the business, which has started to pick up.
My question is if the home is foreclosed how will it affect my business-the S Corp.? Would the mortgage company be able to come after the business for payment?
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Sometimes the easy questions can be the most difficult to answer.
In general, if all your business assets are in the name of the company then they are held by a separate legal entity. The business is not responsible for your personal debts.
I would think that it would be very remote that the creditor might try to pierce the corporate veil and make a run after corporate assets.
But you could get sued by the creditor, lose and wind up with a wage garnishment. You’d then have to garnish your own wages. Painfully ironic.I Own an S Corporation and my Home is Now in Foreclosure. - Dave by Steve Rhode