There is no shortage of options and programs designed to give relief from business debt. So, what are some of the main business debt help options, and how do you decide which is most fitting for your situation?
- There first step is to know what options are available.
- The second step is understanding each option.
- Last, choose which option most fitting for your situation and begin searching for a reputable company that offers that option.
Below, we have outlined the most common business debt help options to help you get started.
Option 1 – Business Debt Restructuring
- Good alternative to bankruptcy.
- Extended term makes payments more manageable.
- Stops calls from creditors and collectors because debt is being satisfied.
- Creates a positive cash-flow within your business.
- End the day-to-day stress of overwhelming business debt.
- Program fees are less than legal fees associated with bankruptcy.
- Keeps vendor accounts in good standing.
- No negative credit impact.
A business debt restructuring company works directly with your lenders to negotiate a new, more affordable payment plan. The whole idea is to give you the ability to satisfy your debt while avoiding a UCC lien or garnishment. It’s also designed to not bring about a negative impact to your credit by allowing you to avoid bankruptcy. Enrolling in this type of program allows to to focus on operating your business without the overwhelming stress of unmanageable debt.
Once a new term is agreed upon all you have to do is stay current on your payments and not add more debt. doing both will assure you graduate your program successfully and your business becomes financially stabe.
Option 2 – Reverse Consolidation
A reverse consolidation is another business debt help option that allows you to avoid bankruptcy and makes payments more affordable. These are two major benefits of a reverse consolidation, but there are more.
Other benefits include:
- Less expensive than bankruptcy because there are no outragous legal fees.
- Requires less time involvment than bankruptcy.
- Easier approval is comparison to a consolidation or SBA loan.
- If you are enrolling MCA debt, your payments will be less frequent.
Really, it is very effective at achieving it’s designed purpose – giving relief for high-interest, high-risk debts.
The drawbacks to a reverse consolidation include:
- Costs more than consolidating through a low interest consolidation loan.
- Although the term will be longer than your current term, it won’t go out as far as with a traditional consolidation.
Option 3 – Business Bankruptcy
It becomes pretty obvious to a business owner when they are facing a bankruptcy situation. Your business is probably losing money at this point and you are struggling to make payroll and operating costs. Most business owners in this situation feel like this is a desperate situation that requires desperate measures. So, just know, if this describes your situation and how you’re feeling, you’re not alone. But there is a silver lining here. In most situations like this, one or more of the bankruptcy alternatives will be just as effective and less consequential.
Business Debt Help Options Conclusion
As you can see, there are debt help options to help almost any business debt situation. The main thing to know about the different options is:
- Business debt restructuring relies on a negotiation process with your lender. It brings about relief by extending the term. It is designed for high-interest debts such as MCA’s or other non-traditional funding loans.
- Reverse consolidation is designed to extend your term and lower you payments as much as 60%. A reverse consolidation funder pays on your debts weekly and you pay your reverse consolidation funder over an extended period.
- Business bankruptcy is for the purpose of gaining relief from debts that do not qualify for a bankruptcy alternative. Debts that do not qualify for an alternative might be debts with lenders that are not willing to negotiate or do not qualify for a reverse consolidation.
If you are in a desperate situation with business debt, call us for a free consultation. In many cases we can help. If we can not help directly, we will help point you in the right direction.
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