Not
ready to close your business? Proven steps for turning failing
business around.
Some business owners feel as though they are against a wall with
debt and contractual obligations. They are exhausted. Their leases,
loans, and contracts pile up, while their money dwindles. Their
business is ruling their life and they just want to get out.
As a frustrated business owner, you may find yourself in this
situation. You may have tried to turnaround your failing company
with little success. And if you have no buyer on the horizon, you
may have decided you've had enough. It's time to close your doors.
But how do you go about doing this? You will find rows of books
at your local bookstore that cover how to start a business, but
little on how to close one. How will you meet the obligations of
your loans and lease? Do you owe money to the IRS, individual agencies,
or contract workers?
There are many items to consider when you close a business. And
you have some choices to make when it comes to getting rid of debt
and folding your company. Let me explain.
Straight
talk about business bankruptcy and closure
Need Instant Cash? Beware of Pay Day Loans! Have you seen the commercials? Cute characters promise financial prosperity. Happy, professional individuals appear to regularly visit their corner pay day loan shop as proudly as cashing a check at the bank. Customers at the grocery store all recommend pay day loans as the easy solution for a lack of funds.
Could pay day loans be the answer consumers with low bank accounts have been looking for? Is there any harm in using these services? Aren't they better than using credit cards or going hungry?
WHY USE A PAY DAY LOAN?
Some individuals reason that paying a bill with borrowed money is better than receiving bad credit marks because of not paying the bill. This is understandable. However, some financial institutions are willing to make the occasional exception if contacted about the situation. Or there may be a small fee, but not a credit report made.
Using it for groceries or other items? Consider the true cost before making a decision. Compare the cost of using a pay day (or cash advance) loan to the fees charged for taking a cash advance on your own credit card. Can family help? Often those who are forced to use pay day loans are not able to repay the loan by the next pay check and that can lead to a cycle of debt and stress.
WHAT IS THE COST?
Several sources, including a consumer report by the FTC (Federal Trade Commission) and the CFA (Consumer Federation of America) state that usual the usual APR is between 350 - 650% with some as high as 780%.
A loan of $100 ranges in cost between $15 - $30. If the loan is not repaid by the pay date then it can be renewed with another fee due at each renewal. A loan of $100 can cost $60 in fees after 3 renewals.
WHO BENEFITS?
Based on the warnings issued by federal and consumer organizations it is clear that using pay day loans or cash advances from these businesses can often lead to more debt and problems. Some sites were reported to automatically roll over the loan and only withdraw the renewal fee on the pay date. Other sites surveyed by the CFA required customers to agree in contract to not participate in class action suits or to file for bankruptcy.
For those who are having debt problems it is recommended to seek no- or low-cost credit counseling from a local non-profit organization. These organizations can help with reducing current interest charges and lowering monthly payments. If the problem is budget, you should look to a financial planner who can help you to manage the money you do have and avoid using credit at all.
About the author:
Scott Morris's personal site on financial planner and financial planner career http://buildingfortune.comfor more information, you can visit http://buildingfortune.com
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Straight
talk about business bankruptcy and closure
The Last Debt Solution Should Be Bankruptcy
A debt solution like bankruptcy should really only be used as a last possible solution. The problem with this solution of debt problems is that it includes a lot more than simply eliminating debt. When someone declares them self bankrupted, all debt collection actions against that person are prevented. The court grants an "automatic stay", which - with a few exceptions means that creditors cannot come after the money owed to them.The most important exception is that when a loan is secured by property creditors can seek relief from the stay and seize that property. The other exceptions are s. . .
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