Do we have recourse against the old owner of a sole proprietorship when the new owner of the business defaults on payment? We were never told that the business had changed hands.

Answer: : We are not attorneys and therefore this is not legal advice. If you have a signed personal guaranty or some form of collateral from the applicant, you may have recourse against them. If your credit application requires customers to inform you of ownership changes or remain liable for the company's debts, you may have recourse. If neither of these applies, we do not think you have much of a case against the business owner.