Running a business can be tough, particularly if you’re a small business
competing against corporations. Though people take on debt in order to
get their businesses off the ground, one of the simplest ways to encounter
financial trouble as a business owner is to take on
too much debt. Loans and merchant cash advances (MCA debt) can be especially problematic during a stagnant economy. Here are a few
options to take if your debt is getting to be too much to deal with.
Sometimes people don’t consider their debtors can be reasonable people.
If your payments are getting to be too high, consider talking to your
creditors rather than dodging them. Be upfront with your suppliers or
your credit-card issuers. They might be used to working with people in
financial crises. Talk about the possibility of a new payment plan, or
ask them if you can extend the terms to give you extra time to pay. Credit-card
issuers would also rather see you continue to succeed rather than go out
of business and get nothing at all.
Negotiating to Settle the Debt for Less
Talking to your debtors can also lead to
settling the debt for lesser amounts. This is usually done when filing for bankruptcy, but
creditors might want to do it ahead of time in order to see your business
succeed. If you need help with negotiation, talk to an attorney for assistance.
business debt lawyer can help you work with your creditors instead of going to court.
Take Another Look at Your Budget
Look at where you’re spending your money. If you have extraneous
expenditures, consider cutting them in order to save more cash. Look at
all your daily expenses and determine what you can save for later. This
includes looking at your payroll. Is there a job you could fill in for
instead of hiring an employee to do the job? Then, when you’re out
of the danger zone, you can hire your employee back.
Selling the Extra
Is there any excess inventory, equipment, or machinery you can do without?
What about cars, real estate, or any other unnecessary items? Consider
selling what you can. The proceeds can go towards reducing your debt.
Loan or Debt Consolidation
Sometimes part of the problem is minimum monthly payments for several different
loans. If you can take out a business loan for the total amount of your
debt, you’re left with 1 payment a month with 1 minimum monthly
payment to worry about. Debt consolidation works in a similar way. You
can work with your creditors to consolidate all of your debts into 1 and
negotiate an affordable payment plan. However, this will be reflected
on your credit report.
One final option you could take is filing for
bankruptcy. Chapter 11 bankruptcy allows you to work with your creditors by negotiating
a repayment plan. It lasts from 3 to 5 years, during which you continue
to make payments on the debt. After 5 years, the remainder of the debt
is discharged. Bankruptcy will destroy your credit, but your credit can
be built back up later.
If you’re ready to begin resolving your debts, contact our dedicated
debt relief attorneys. Our founding lawyer, Simon Goldberg, is a highly rated attorney who understands
your legal rights and options for relief. He has studied the nuances of
credit scoring and restoration by CreditCRM and has become a Certified
Debt Specialist and a Certified Credit Counseling Specialist by the International
Association of Professional Debt Arbitrators. He’s passionate about
helping people resolve their debt and credit issues. Trust him to have
your and your business’s best interests at heart.
Contact us at (888) 301-0584 or fill out our online form to schedule a free initial
case consultation today.