Running a small business can be tough, especially when it comes to managing finances and dealing with debt. If your business has racked up debt that is becoming difficult to handle, you may need help negotiating with creditors and developing a debt repayment plan. The good news is there are options and professionals who can assist.
Why Seeking Help for Business Debt Matters
Getting overwhelmed by business debt happens more often than you’d think. In fact, according to a 2022 study, over 50% of small business owners report having at least $10,000 in business debt. And while taking on debt isn’t necessarily bad – it can help grow a business after all – too much debt can spell trouble.If your business debt is starting to negatively impact daily operations or you’re struggling to make payments, it’s important to address the issue head-on before things spiral out of control. This is where working with a professional business debt negotiator can make all the difference.
-How Business Debt Negotiators Can Help
Business debt negotiators, also sometimes called credit counselors or financial consultants, are professionals who specialize in helping business owners assess, manage, and repay debt. Their job is to look at the full financial picture and come up with customized strategies to relieve debt burden.Some of the key ways a business debt negotiator can help includes:
- Analyzing debts – They’ll take a close look at all outstanding debts, including the types of debts, interest rates, monthly payments, and more. This info helps them understand the full scope of the debt burden.
- Assessing finances – In addition to debt, they’ll also analyze overall business finances including income, operating costs, assets, and other financial factors.
- Negotiating with creditors – One of the biggest values is they’ll negotiate directly with creditors on your behalf to try and lower interest rates, reduce monthly payments through repayment plans, or even agree to settle debt for less than what’s owed.
- Creating debt management plans – Using all the financial info and negotiated terms, they will create customized debt repayment plans tailored to your business’s situation and capabilities. This makes managing debt much more feasible.
- Ongoing support and guidance – Many provide ongoing accountability, support, and guidance as you work your way out of debt. This can help you stick to the repayment plan and not take on further debt.
Bottom line, working with a skilled business debt negotiator puts personalized expert help on your side during a challenging financial time. And this can be what saves a struggling business from going under.
What to Look for in a Business Debt Negotiator
Not all business debt negotiators are created equal. You want to partner with one that offers the knowledge, resources, and support your particular situation calls for. Here are some top things to look for as you evaluate options:
- Specialization in business debt – Seek out negotiators with extensive experience specifically helping business owners with debt issues vs. only catering to personal consumer debt. The business finances, creditors, and debt options can differ.
- Good negotiator reputation – Look for great reviews and track records getting creditors to agree to reduced payments, lower interest rates, settlement offers, and other helpful terms for clients. A strong negotiator can make a big impact!
- Variety of debt repayment options – Each business’s situation is unique, so it helps to find a negotiator able to create customized debt repayment structures like lump sum settlements, installment plans, changing due dates, and more.
- Upfront pricing – Quality business debt negotiators will be transparent about their pricing and fees from the very start. Be wary of any who are vague, push hidden fees, or won’t give you clear rates.
- Support beyond negotiation – The negotiator shouldn’t just get you a deal and then disappear. You want one who also helps with repayment plan guidance, continued creditor interactions, and ongoing accountability.
Doing a little research goes a long way towards finding the kind of committed, ethical, and effective business debt negotiation help your company really needs during this pivotal time.
-Overview of the Business Debt Negotiation Process
So what exactly can you expect if you decide to enlist the services of a professional business debt negotiator to tackle debt? The process typically includes:Initial Consultation
- You’ll share details on all outstanding business debts, creditors, payments, terms, issues making payments, impacts debt is causing, and the help you’re hoping for. Open communication sets things up for success.
- They’ll ask questions on overall business finances, assets, income fluctuations, who manages finances, previous attempts to lower debt, and other relevant factors.
- Based on the full picture, they’ll share if they can help, what results could look like, and what the process entails. You can also ask questions.
In-Depth Analysis
- If you choose to move forward, the next step is a deep analysis of your accounts payable and accounts receivable, income statements, tax returns, assets, liabilities, and any other financial components.
- This helps them pinpoint the scope of debts, monthly shortfalls, wiggle room in the budget, and other info vital to creating a customized negotiation strategy and repayment plan.
Negotiations & New Terms
- Now it’s time for the negotiator to reach out directly to your creditors and use their leverage and expertise to negotiate better repayment terms. This could mean lower interest, reduced or delayed payments, settling debt at a discount, or even re-aging debt.
- They’ll keep you looped in on negotiations and have you approve any final agreements. The goal is terms the business can realistically manage based on finances.
Debt Management Plan
- With negotiated terms in place, they’ll draft a detailed debt management plan outlining the new customized repayment structure for each debt. This is your roadmap.
- It will include who to pay, dates, amounts, where to send payments, and any other fine print. You’ll get a simple calendar view to follow.
Ongoing Support
-- Reaching agreements is just one step – actually following the plan and sticking to new repayment terms is critical for eliminating debt.
- Many negotiators remain involved to offer accountability, reminders of payment deadlines, continued creditor relationship management, reviews of new debts that can’t be taken on, and support if any issues surface.
Address Debt Before It’s Too Late
If business debt is starting to negatively impact finances, operations, or your own mental health as a business owner, don’t wait to get help. Ignoring growing debt rarely makes issues disappear. And the longer you delay, the fewer options you’ll have.The good news is professional business debt negotiators have great success working with business owners just like you to:
- Better understand current debts and finances
- Get creditors to agree to more affordable repayment terms
- Create customized debt management plans
- Provide guidance and accountability as you repay debts
Don’t struggle alone or assume nothing can be done. Seek out expert negotiating help to resolve debt on terms your business can manage – and look forward to a less stressful future!
**Q: How much do business debt negotiators charge?**Prices can vary depending on your total debt amount, number of creditors, and complexity of your situation. Many charge monthly retainers while others take a percentage of debts reduced. Get pricing details upfront before committing.
-**Q: Can a debt negotiator help if my business is behind on tax debt?**Yes, skilled negotiators are often able to help negotiate IRS and state tax debt by setting up installment plans, penalty abatements, currently not collectible status, offers in compromise, and more. Don’t hesitate to discuss tax debt specifics.
**Q: What debts do business debt negotiators work with?**From loans to lines of credit to past due supplier invoices, reputable negotiators can tackle a wide variety of common business debt types and even multiple debts across creditors. Discuss the full range during your initial consultation.
**Q: Can debt negotiators help if my business is facing bankruptcy?**If bankruptcy is on the table, a negotiator may be able to negotiate deals with creditors for reduced or delayed payments to help avoid that outcome. The sooner you enlist help facing bankruptcy, the more can potentially still be done.
**Q: How long does the business debt negotiation process take?**Every situation is different based on total debts, number of creditors, negotiator bandwidth, creditor cooperation, and repayment terms agreed upon. But the negotiation phase may take 1-6 months. Overall debt repayment could take 1-5 years depending on amounts owed.