On an individual level, throughout the country there are quite literally millions of people who are struggling with debt that they cannot manage and that they feel they cannot get out of. Businesses are no exception. Especially at this time of increased uncertainty brought on by worldwide Covid-19 lockdowns – it is no surprise to see many businesses struggling to keep up with their repayments. The eventual consequences of not being able to get out of debt could be the failure of your business, bankruptcy, personal stress and so on. Needless to say, this is something which nobody wants and if your business is struggling with debt, here is how to get out.
Consolidate Business Debt
An option you may have not yet considered is the possibility of consolidating your business debts. As already mentioned, it is in your creditors best interests to do what they can to keep your business afloat, as bankruptcy means they will likely only get back cents on the dollar. By using debt consolidation companies, you will be allowing an expert to negotiate with your lenders on your behalf. Those negotiations can mean modifying your loan terms or restructuring your payments. Whatever the case, it’s worth remembering that whichever debt consolidation company you choose – they are working for you, so whatever arrangements they are able to make with your creditors will be in your best interests.
Speaking With Creditors
This step involves having an open and honest conversation with your creditors and try to reach an agreement for how much you will pay them and when. Creditors do not want outstanding debts any more than you do so it is in their best interests to hear you out. Equally, creditors have a legal responsibility to accommodate you based on your financial situation and so you may find that you can reach a great agreement which works for the best of all involved.
Managing Your Finances
The key to this is to understand completely what is happening with the business cashflow. Start with a simple balance sheet which should include the expenditure and income of the business. Within this you should only include necessary business expenses. Once you have this final figure from your monthly finances, you will be in a better position to speak with creditors about a repayment structure.