Owning a business can be very risky, especially at a juncture where the economy is still recovering. A business can easily succumb to several factors, leaving an owner struggling to pay off debts. However, if everything goes south, it is important for Wisconsin business owners to understand their options when it comes to debt relief.
Having a struggling business can be disheartening; however, it is important to keep a level head in order not to incur more losses. Bankruptcy may be a viable option. For one, a business owner can file Chapter 7, or liquidation, bankruptcy. This is ideal for solo proprietors, entrepreneurs or small businesses. It may also be advantageous if a business owner’s debts are mostly unsecured. In Chapter 7, the assets of the business, including the client list, will go to paying debts.
Another possible option is filing for Chapter 13 bankruptcy. This type of bankruptcy requires a business owner to pay debts by means of a repayment plan over time. Once the repayment plan runs its course and there is still a remaining balance of unsecured debts, those are usually discharged.
With the possible options laid out, the next advisable step for Appleton and Outagamie, Wisconsin, business owners is to determine whether they are qualified for Chapter 7 or Chapter 13 bankruptcy. This step can help ensure that the business owner is fully informed of the process of filing for bankruptcy.
While filing for bankruptcy may seem like a scary alternative for Appleton and Outagamie business owners, it is essential to keep an open mind. Although many people think of bankruptcy as a desperate, last attempt at saving their finances, it is not always the case. It is a legal and organized way out of debt. People can come out of bankruptcy with their belongings intact and with a new financial perspective.
Source: Fox Business, “A Bankruptcy Guide for Business Owners,” Donna Fuscaldo, Aug. 6, 2013