The economic impact of Covid-19 is still being felt. Many businesses have had to shut down, and a lot of people lost their jobs. With other companies struggling to function at half capacity, a few others have no option other than to file for bankruptcy. But bankruptcy is not the end of the road as a business owner. With sound advice from a bankruptcy lawyer, you can successfully negotiate bankruptcy and get your business back to its feet. Here are some tips to help you out.
Find the problem
It may take a while before you even notice that your business is losing money. However, immediately you notice that you must find the problem in earnest and then find measures to resolve the issue quickly. If you are already facing problems, take your time to assess your business and identify the root cause of the problem. If the issue can be resolved by the next quarter, then your business is not yet in trouble. However, if you have not been losing money and discover what the issue is, you should consider filing for bankruptcy.
Assess your debts
Once you are not making profits, debts will begin to pile up. However, before taking the bankruptcy route, you should first know what your total debt is. You may calculate your total debts and then balance them against your assets. If your current assets can comfortably offset your total debt, you are okay. If your total debts outweigh your existing assets, then filing for bankruptcy is a logical step. Note that you must include everything when calculating your total debt, and you must recheck your paper trail. This part is crucial, so you must be meticulous in this endeavor.
Get legal help
The bankruptcy process is long and intricate. To ensure that you are up to speed and given the best advice, you should seek help from a bankruptcy lawyer. Bankruptcy has many branches, and working your way to getting the right solution is very important. A bankruptcy lawyer can offer you sound advice to help you negotiate the bankruptcy process. Bankruptcy does not provide a one-fits-all solution, and for this reason, you must know which type will serve your best interests. Some bankruptcy options will limit your liability concerning debt but may also trigger the liquidation of your business assets.
Settle on a repayment plan
This is a crucial aspect of the bankruptcy process. It is imperative, and you will be required to go for compulsory class for credit counseling. At the end of this class, you will be mandated to sign some forms. These forms will be binding as they indicate that you are willing to work with your creditors to pay back the bailout amount. A judge will sit and determine if the repayment plan is suitable for both parties; once this is done, your company will be on its way to getting back to its best.
It may not be a good look for your business, but bankruptcy offers a lifeline. If properly navigated, bankruptcy can serve as a springboard to future success.