With the many changes that are in business worldwide it is obvious that current business will not be like those of the 1990 and 1980s.
Unlike in the 1990s and 1980s, today with the unstable economy,high operational costs and stiff competition, it is so easy for a business to get into bankruptcy, which, in the past, was often the simplest solution for businesses drowning in debt.
A business owner needs to find a way to reduce his or her debt obligations, business debt relief can be a breath of fresh air. It is common with most businesses to have to pay for services and products. However, at times businesses end up paying out more than they are making. Paying employees, taxes, vendors and the like can add up over time. If business owners are not careful, their financial obligations can exceed their profits and that situation can lead to bankruptcy.
Seeking business debt relief is a practical idea for business owners. Business debt relief can reduce debts, pay the creditors, help avoid bankruptcy and ensure a business is still profitable.
The most important consideration when seeking small business debt relief is whether you plan to continue to operate your business. If you do, it is essential that you find debt relief that preserves your personal and business credit. Consolidating or refinancing your business debt can result in a lower APR, longer repayment terms, and less frequent payments. Obtaining a consolidation loan may be easier than you imagine and offer the debt relief you’re looking for. If you do not plan to continue operating your business, debt relief will be about eliminating debt while protecting your personal assets.
These are some of the ways on how to get debt relief for your business.
The most common one is debt consolidation loan:
The idea here is to borrow enough from one source (usually a bank) to pay off all your creditors. The advantages of a debt consolidation loan are that you should get a better interest rate and you’ll have to write only one check a month. Plus, it stops all those credit card companies and other creditors from hounding you unmercifully every month.
It is basically where you hire a debt relief company to negotiate with the creditors on your behalf. The goal is to get them to agree to settlements where you make lump sum payments for a portion of your debts (this should much less than your total balances). In return the creditor agrees to forgive the rest of the debts.
As the debt relief company is negotiating with your creditors, you stop paying the bills involved (e.g. monthly credit card bills). Instead, you will be making smaller payments to a separate trust account to pool in your resources.
Unfortunately success is not guaranteed as you have proven that you haven’t been able to manage your finances. But it could be worth a try. The good thing is that you will not be burdened with the additional costs of hiring someone to help you out. You will be able to concentrate all your funds on paying off your debts.
Consumer credit counseling:
There are number of consumer credit counseling agencies available. Depending on how serious your financial woes are, your counselor may recommend a debt management plan (DMP). The way this would work in brief is your counselor will determine how much you can pay and then negotiate with the creditors on your behalf.
The benefit of going for this type of debt relief option is that your monthly payment will most likely be much lower than the sum of the payments you are currently making.