If your business has been thriving the past few years, you probably haven’t been concerned about the debt you took on to initially get it started. However, if times have gotten tough because of the coronavirus pandemic or other factors, your business debt may be feeling like a very big burden that may never go away. Should this be the case, it may be best to consider using the services of a debt settlement company. By doing so, you may not only be able to rid yourself of the debt you owe, but do so much faster and easier than if you continued to struggle with the problem on your own.
Do Many Business Owners Struggle with Debt?
Absolutely. When most entrepreneurs begin their businesses, credit cards and loans are often what are used to get a company up and running. In fact, between 25-30% of all small business owners take on credit card or loan debt when getting started.
Can I Avoid Bankruptcy?
If you are proactive and choose to work with a debt settlement company, you can likely avoid having to file for bankruptcy regarding your business. Not only will this allow you to keep your business operating, but it will also let you pay off your debt for totals that will probably be much lower than the original amount.
How Long Until I’m Debt-Free?
Since each business owner’s situation is unique, the amount of time it may take before you are debt-free will vary. But in most instances, business owners who work with a debt settlement company can expect to have their creditors paid off within 24-48 months.
What Exactly is Debt Settlement?
While it sounds obvious, debt settlement is actually a multi-faceted approach to solving your debt problems. In essence, once it is determined you qualify for help from a debt settlement company, you will be putting the fate of your debt in the hands of the company’s experienced negotiators. These individuals, whose job it will be to contact your creditors and negotiate settlements on your behalf, will always try to get the best possible deal for you and your business.
Are Creditors Open to Settlements?
Very much so. In fact, most business owners with debt issues are surprised at how willing their creditors are to reach settlements. While some creditors may choose to stand firm on what is owed, the vast majority realize that getting something rather than nothing at all is a much better option. Therefore, they are very willing to speak to debt settlement negotiators and make a deal that will benefit them as well as yourself.
Will I be Charged Fees for this Service?
Yes. In most cases, the debt settlement company will charge fees of 15-25% of the amount of total debt you owe to creditors. However, you should remember that the fees are never charged to clients until a deal has been reached with a creditor and you have been notified and agreed to the deal. If you ever try to work with a debt settlement company that wants to charge fees upfront before doing any work on your behalf, look elsewhere immediately.
How Will Creditors be Paid?
Once the debt settlement company determines you qualify for its services and you enroll in its program, you will begin depositing money into an FDIC savings account that will be used when paying creditors. As each creditor is contacted by the company and reaches a deal to settle your debt, you are contacted so that you can approve the deal. Once you do, money is then transferred from your account to the creditor, making the process smooth and easy.
Can I Get Rid of All My Debt?
Probably not. When working with a debt settlement company, there are only certain types of debt that qualify for such services. For example, if you now have thousands of dollars in credit card debt or are struggling to pay off unsecured debt such as a personal loan, these examples would qualify for settlements. However, if you have accumulated tax debt or student loan debt, these will not be handled by the debt settlement company. Additionally, any type of secured debt such as an auto loan or mortgage payments will also not qualify.
How Do I Qualify?
To qualify for business debt settlement services, entrepreneurs usually have a minimum of $7,500 of unsecured debt they are struggling to pay off. Along with this, you will need to be the sole proprietor of your company, since the debt you have incurred will need to be listed under your name only. To get started determining whether or not you can qualify for business debt settlement services, you will likely go online and fill out a short form where you provide details about your debt. If this information is satisfactory, a company representative often contacts you by phone to discuss your situation in greater detail, answer any questions you have, and help you get enrolled with the company.
Should I Try to Pay Off the Debt Myself?
Since you’ve been trying this for some time to no avail, it is best if you turn your debt problems over to experienced and knowledgeable debt negotiation professionals. By doing so, you will ultimately settle your debts for far less than if you had continued trying to solve the problem on your own, which alone is enough reason to pursue this option.