Small Business Bankruptcy

Small business bankruptcy is common among the many companies that are owned and operated by common people who place all they have on the line to succeed. Many become entangled in debt even though their company is thriving, forcing them to consider a business bankruptcy option. Small companies are the heartbeat of the nation's economy and America can ill afford to have so many bankrupt companies filing in the courts. For many owners, death to their dreams seem just around the corner as they frantically juggle payments to creditors in order to avoid looming bankruptcy. Creating a successful company without financial problems may be difficult, but allowing God to be part of the plans will give a company many more opportunities. "Thy faithfulness is to all generations: thou hast established the earth, and it abideth." (Psalms 119:90)

There are other options for owners who are facing this financial crisis. Many times there can be a plan implemented that will save the company, help the owner get out of debt, satisfy the debtors, and provide ongoing service to American consumers. A win-win solution is what is needed for all in projected small business bankruptcy filings. Many times a professional credit counseling service can design a financial plan that will meet everyone's needs while preserving the integrity of the owner.

Small businesses comprise almost 22 million of the companies in America and account for close to two-thirds of the employees hired in the country. There are approximately 40,000 bankruptcies that occur each year making it apparent that there should be workable alternatives to this tragic occurrence. Many owners that are considering a small business bankruptcy have found assistance through proper credit counseling services. These services can help an owner devise a plan that is workable within the available financial means that his or her business has.

Surprisingly, many lending institutions are willing to negotiate the debt owed them with professional, credit counselors on behalf of a small business. Sometimes, the negotiated debt can be as little as a few cents on the dollar. Even though lenders may not receive the full debt owed them, they are satisfied with what they agree upon because bankruptcy would only cause them to lose all their investment instead of part. Credit counseling services can work out a plan that provides for a payment schedule that is manageable by the owner. In cases that owners default on this agreement, all assets are generally sold and any cash is directed to the lenders.

A plan to get out of debt as well as satisfy lenders can allow a business to avert becoming bankrupt as well as continue to make a profit and grow. Many owners have seen their hard times throughout the life of their company, but know that planning is key in developing a financial future. An expert credit-counseling source can provide the direction and execution for a plan to survive financial hardships when business bankruptcy seems like the last option. Many times small companies are not in debt in an exorbitant manner. Many may only be in debt for as little $15,000 to $20,000.

However, to the owner who is crushed with credit card debts, vendors calling for their checks, personal debts, employee paychecks and lease agreements, filing as bankrupt may seem to be the only way out. Most small businesses are the result of personal dreams of someone and are considerably hard to let go of even in the face of mounting debt. That is why some owners hang on to their dream as long as they can before declaring business bankruptcy. Although for some, the struggle to stay above water becomes too stressful for all concerned and filing for bankruptcy is almost a welcome relief.

The financial entanglement can be very difficult to handle afterwards. Credit is damaged and a lifetime of assets may end up liquidated to pay back to creditors who are even then not fully paid off. Expert financial planning and assistance can often allow owners avoid business bankruptcy. Before choosing this option, it is vital to check the facts regarding other options including credit counseling and financial planning. There are many online agencies that offer financial counseling that is legally correct and professionally implemented to give the best option possible.

Most financial plans assist a small business owner in paying off debts and securing acceptable credit within 4+ years. If the individual has not been able to develop a financial plan that will pay off creditors and place them in good standing within 3 to 4 years, they probably should consider other financial plans. Considering the length of time that a small business bankruptcy stays on a credit history, it is worth the effort to explore as many options as possible before succumbing to business bankruptcy.

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