Business funding without a personal guarantee: what's real
Plenty of ads promise "EIN-only" or "no PG" business credit. Some of it exists. Most of it comes with conditions the ad leaves out. Here's how it actually works, so you know what to look for and what to ask before you sign.
What a personal guarantee is
A personal guarantee (PG) is your promise to repay the business's debt yourself if the business can't. With a PG, a default can follow you personally, including to collections and your personal credit. Without one, the lender's claim is mainly against the business.
Most 0% business credit cards require one
The 0% intro APR business cards from major banks are approved mainly on your personal credit, and almost all require a personal guarantee. That's the trade: the cheapest business credit available, backed by you. If someone advertises 0% business cards with "no PG and no credit check," ask exactly which bank and which product.
Where no-PG funding does exist
No-PG offers usually show up when the business itself can carry the risk. Lenders look for:
- Established business credit: a business credit file with reporting trade accounts and payment history.
- Steady cash flow: consistent monthly deposits in a business bank account.
- Time in business: the longer the track record, the more options.
Some revenue-based financing is offered without a personal guarantee to businesses that meet those marks. It depends on the lender, the product and your file, so it's an offer-by-offer answer, not a category.
The fine print to check
- "No PG" isn't always zero personal liability. Many no-PG agreements still include a validity or performance guarantee: you can be personally liable for fraud, false information, or breaking the agreement's terms.
- "No PG" doesn't always mean no credit check. Some lenders still review personal credit to approve.
- It usually costs more. Without your guarantee the lender carries more risk, and the price reflects it.
- Payment schedules vary. Some revenue-based products take daily or weekly payments from your account.
How to get closer to no-PG options
- Build business credit. Trade accounts that report to Experian Business and SBFE give lenders a file on the business, not just you.
- Run revenue through one business account. Lenders underwrite what they can see in your deposits.
- Keep the entity clean. Consistent legal name, address, phone and EIN across every account and bureau.
Where to go from here
Strong personal credit?
0% business credit is usually the cheapest money, even with a PG. See if you qualify in 60 seconds, with no credit pull.
Steady revenue?
Revenue-based options through our lending partners, some of which don't require a personal guarantee for qualifying businesses.
Building business credit?
Business tradelines report to Experian Business and SBFE so your company builds its own file.