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Ondeck Business Debt Relief and Debt Settlement

As a small business owner, all you want for your business is for it to succeed. It is why the majority of small business owners rely on credit card debt and loans to fund their businesses. They prefer unsecured loans because they are easier to get, have fewer restrictions, and don’t require collateral.


To make sure that your business succeeds, avoid high debt. Also, your timing should be right. Small businesses play a vital role in the economy. Unfortunately, most of these small businesses don’t succeed. It could be because of too much debt, poor credit arrangements, or cash flow problems.


How to Handle Debt


If you are a small business owner struggling with debt and experiencing cash flow problems, then you aren’t the only one. Luckily, the following are ways you can handle your debt.


Assess Your Debt


You can assess your debt to determine whether it is getting out of hand. One way to do this is to calculate your debt-to-income ratio. To calculate the DTI ratio, you need to identify how much you spend repaying debts every month, then divide it by the monthly gross income.


If your DTI ratio is more than 36%, it means that you do not have enough cash flow. As a result, you will need to change your business’s spending habits. For instance, you can find ways to save on energy bills, purchase products at wholesale prices, or lay off some of your employees.


Increase Sales and Revenue


Too much debt affects your cash flow. You will spend most of your money repaying debt, which means you won’t have enough to manage and run your small business. Therefore, you need to ensure that you balance your debt-to-income ratio and that your business has adequate cash flow. One way to achieve this is to increase sales and revenue.


First, people need to know about your business. Effective marketing campaigns can convince people to try your products or services. If you are starting your business, you should quote low prices to attract new customers. After a while, you can increase prices to boost revenue.


You can also increase sales by targeting the right demographic and creating long-lasting relationships with your customers. Satisfied customers can tell their relatives and friends about your business or services. It would be best if you considered starting a referral program and rewarding loyal customers.


Think About Debt Settlement


Business debt settlement is a process that can help you get out of debt without having to file for bankruptcy. You will have to negotiate with your creditors and convince them to consider a lower payment on the debt you owe.


If you aren’t good at negotiating, you can hire a debt settlement company to negotiate on your behalf. These companies have professional negotiators who help you repay your loan with the money you can afford. Here is everything you need to know about business debt settlement.


What to Look For In a Debt Settlement Company


There are several debt settlement companies in the industry. Therefore, you have to do proper research to ensure that you choose the right one. Some firms take advantage of your situation or even make it worse. They are only after your money and will not help you reduce your debt.


To choose the right debt settlement company, you can ask your friends or co-workers for recommendations and referrals. You can also check online reviews and testimonials from previous clients. Only use reputable sources for research.


You should confirm with the Better Business Bureau and CFPB whether there are any complaints against the company. Alternatively, you can contact the attorney general to verify whether the state has taken any legal action against the firm or ask for the necessary documentation.


The right debt settlement firm should:


  • Have a quick turnaround time.
  • Not have hidden or upfront fees.
  • Have a team of experienced professionals.

Before choosing a particular debt settlement company, ensure that you compare the prices. It will help you choose a firm that fits your budget range. Additionally, confirm whether they offer credit restoration upon payment.


The Debt Settlement Process


If you decide debt settlement is the ideal option, the debt settlement company you choose will require you to fill a form to determine whether you are eligible. If you qualify, they will contact you and give you more details about their program. First, you will have to build your FDIC-insured saving account. Ensure that you deposit money every month. Once you have saved enough money, the debt settlement company will initiate negotiations with creditors. After successful negotiations, the company will ask you to approve and finally be free of debt. It is important to note that you will have to pay the company a percentage of your debt.


Who Qualifies For Debt Settlement?


Secured debt, tax debt, mortgage, and federal student loan doesn’t qualify for debt settlement. If you aren’t sure whether you are eligible, you can ask a debt settlement company for a debt evaluation. You are eligible for debt settlement if:


  • You have unsecured debt amounting to $7,500 or more.
  • You are the owner of the business, and the loan is in your name.
  • You are finding it hard to repay the debt.
  • You applied for the loan because of financial hardships.

The above are things you need to know about debt settlement. Too much debt can prevent your business from succeeding. A debt settlement company will help you clear your debt so that you can focus on other business goals.