Fiducia TogetherPersonal credit and business borrowing
Why lenders look at the director personally, and what that means.
Please note: This page explains what a term means. It is general information, not legal, financial, tax or investment advice, and it does not know anything about your business. Before you sign, file or commit to anything, check it with an accountant, a solicitor, or the official guidance we link to.
What it means
Lenders to small companies routinely assess the directors' personal credit alongside the business, and often require a personal guarantee.
Why it matters
A director's personal credit problem can block business borrowing, and a business failure with a personal guarantee damages personal credit for years.
What it looks like in practice
Keep personal and business borrowing separate where possible. Using personal credit cards for business is common, expensive and mixes the two records.
What to watch out for
Guarantees given years ago and forgotten. They continue after you resign as a director unless formally released.
Where to get proper advice
Your own credit file, checked annually. A solicitor before signing any guarantee.
Where to read more
Last reviewed 2026-08-28 by Fiducia Together · Next review due 2027-08-28
Please note: This page explains what a term means. It is general information, not legal, financial, tax or investment advice, and it does not know anything about your business. Before you sign, file or commit to anything, check it with an accountant, a solicitor, or the official guidance we link to.