Can You Save Assets From Being Seized If Your Business Has Taken On Too Much Debt?
Starting a new business and successfully managing and operating it takes a lot of hard work, effort, and most of all, money. Many business owners do not have funds on hand to pay for all of their business expenses when they first begin their entrepreneurial endeavor. As a result, prospective business owners may decide to take on loans to get started.
If you have done this, and you were able to keep your business thriving, you could still be vulnerable to having your circumstances change and your costs rise. When you decide to take out loans and debt, there is always a chance you could find yourself in a position where you are just not bringing in enough money to pay those financial obligations back.
There may be no worse proposition for a business owner than struggling with overcoming crushing debt. This situation can make a business owner feel hopeless and distressed. When creditors are calling and harassing you, this certainly does not improve your already harrowing circumstances. Potentially, though, negotiating with some creditors may be a remedy for keeping some of your most important assets.
How to Prevent Certain Assets from Being Seized by Creditors
You may have some assets that you cannot have taken from you. In this situation, debt reaffirmation could be a possible solution to your problem. A creditor that holds your debt may be willing to devise a reaffirmation agreement with you so that you can stop the hounding calls in return for following the adjusted pay structure and paying off the debt.
To have a debt reaffirmed, you must show the court that you have the funds to not only pay for your current living expenses but also enough to pay for the newly structured agreement with the creditor. In the reaffirmation agreement that you have established, the following should be included:
- How much debt you are having reaffirmed.
- How the calculations were done to determine the balance.
- The debt is not going to be discharged through a bankruptcy filing.
If you do not have statements of your accurate income and expenses showing you actually can afford the debt, then the court will likely deny the reaffirmation agreement.
You can choose to reaffirm your debt with the help of an attorney or without. When you go without legal counsel, then you are required to have a hearing that will be overseen by a judge. If you use an attorney, then your lawyer will put in writing that you are fully aware of the debt you are assuming, you voluntarily made the choice to acquire the debt, and you understand your legal obligations to your agreement.
Speak to a New York Business Bankruptcy Attorney Today
Figuring out how to unravel complicated financial challenges is not an easy thing to do. The New York City business bankruptcy lawyer Harry D. Lewis has over four decades of experience helping businesses work through various financial crises. Reach out to us today for help.
Resource:
uscourts.gov/sites/default/files/form_b2400a.pdf
