Skip to content

Require Couple to be Borrowers on Commercial Loan?

Answered by: 

Question: 
California: Husband is operating a business under his sole proprietorship. Fictitious name is filed under his sole name. Wife assists husband with the business. She has no other source of income. Can the bank require husband and wife to be co-borrowers on a commercial loan? Loan is secured by the business only.
Answer: 

You don't give enough information for me to give a definitive answer and you have to look to state law to determine if a H&W can be a sole proprietorship. In some states this would be a partnership.

Review your state law for the definition of a sole proprietorship and then review Reg B 1002.7(d) and its Commentary.

First published on BankersOnline.com 7/2/12

First published on 07/02/2012

Filed under: 
Filed under compliance as: 

Banker Store View All

From training, policies, forms, and publications, to office products and occasional gifts, it’s available here:

Banker Store

hot right now

image description

Looking for effective, convenient training on a particular subject?

BOL Learning Connect offers more than 200 courses ON-DEMAND or on CD ROM from AML to Reg Z and every topic in between.

Search Topics