But all of that is negotiable. Given no opposition, yes they will collateralize everything including the kitchen sink. But if you are only getting a fifty dollar loan, you do not HAVE to give them 5 million in collateral. Just like a farm corporation will ALWAYS be ask to sign personal guarantees by the owners of the corporation. But if the corporation is financially fit enough to stand on its own two feet, the owners certainly have the right to request there not be any personal guarantees. Then it will be up to the bank to decide if they want the corps business without personal guarantee or if the corp should seek another lender. It is all negotiable. Banks will always over collateralize when given the chance. Does not mean you have to let them. I'm not saying it is a bad idea if you have a good working relationship with a lender and you have no intentions or worries of ever defaulting. All I am saying is that the amount of collateral a customer supplies is negotiable and the bank then determines if that level of collateral is sufficient and if they want to make the loan with said collateral. John |