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Client Log InBusiness debt relief for businesses facing financial difficulties and in need of help.
Business debt occurs when business owners struggle to meet debt obligations. Every year thousands of American business owners seek debt relief services due to desperate financial trouble. The businesses that do overcome the challenge do so by becoming economical and cautious. Business debt relief reduces expenses and helps businesses survive. Before exploring bankruptcy consider all other options, for beginners see if you can cut any expenses immediately.
Small Business Debt Relief
Business debt help is here. If your struggling with business debt let us guide you to financial success.
Related to: Business Debt
Business Debt Consolidation Loans
Your business may qualify for a debt consolidation loan from a nonprofit organization such as: The small business association. This type of loan is generally low interest which is more affordable. The qualification for this type of loan is difficult and time consuming. If you do not qualify and/or do not have the time to apply using collateral can help you get a loan quicker. This could be a great option although is a major risk because you can lose assets.
Debt consolidation loans pay off original creditors and put all your obligations in one monthly payment. In addition debt consolidation loans save you money on the interest and in many terms roll out the payback to a longer period to significantly increase operating cash flow. The flip side to debt consolidation is it may take up to five years to pay in full. For the duration of the loan the lenders will accrue interests at above prime rates. The compounding interest limits the amount you can save with this form of business debt relief.
Business Bankruptcy
If you have already explored all alternative options and decided you have to go through with business bankruptcy, you’re not alone. Thousands of businesses are forced to declare bankruptcy annually. There are many reasons to continue the fight especially the cost and time of filing, although there is no shame in pulling the trigger in fact it could be the best decision for your business.
Two types on bankruptcy include “Chapter 11” and “Chapter 13” known as “restructuring”. These types include renegotiating the terms and planning a structured payback. Both filings will have serious effects on business credit scores but help avoid the “Chapter 7” bankruptcy known as “game over”.
In many cases, you’ll need to declare Chapter 11 bankruptcy. Chapter 13 declarations are generally reserved for individual debtors who carry large amounts of unsecured debt. Chapter 13 filings may available to sole proprietors. If you’re the only employee of your business, you have the legal right to declare bankruptcy under Chapter 13 of the U.S. Bankruptcy Code. However, this type of bankruptcy comes with a debt limit: You can’t file for Chapter 13 bankruptcy with more than approximately $1.4 million in total debt. If you have more than $360,000 in unsecured debts or $1.1 million in secured debts, you must file bankruptcy under Chapter 11. Both results conclude similar outcomes which include proposing plan for your payback.
Knowing your numbers helps millions US businesses profit each year. Know where you can restructure and/or save. See where you can add additional streams of revenue. Going over your financials every quarter can help achieve financial success.
The flip side to filing for bankruptcy is the negative impact it has on your business credit score. Even if your restructuring is complete the file stays on your business credit report. This will hurt your business when you apply for new financing in the future.
A Realistic Alternative for Business Debt Relief
Your business debt may qualify for relief through debt settlement. Eligible debts may include personal credit cards used for business expenses, unsecured business loans, merchant cash advances, and more. The debt settlement process has qualities of business restructuring but will likely have a greater impact on the savings amount. Every case is unique, although you may be eligible to reduce a significant portion of your business debt. If you qualify you can get out of debt in as soon as 12 months, reduce your payments, and have the least impact on your credit score.
As a business owner you have important decisions to make every day, with business debt relief you have many options such as: business debt consolidation, bankruptcy, debt management, debt settlement and more. Before choosing which is best for you, do your due-diligence as this decision will be present in the long game, think of this as a marathon, not a sprint.