Business Debt Negotiation

Business debt negotiation is what you are going to need if you run into problems with paying your debts while you are in business.  Business debt negotiation will involve you either contacting your creditors directly or through a third party.  Many businesses are facing debt problems in the uncertain times which we are living.  In fact debt management issues are one of the major causes of business failures and bankruptcies.  In the good times a business will find it a lot easier to get by, because business is easier to come by.  When times get tough, a lot of lazy business practices are exposed.  Business debt can also be because of another companies lazy business dealings...they can't pay you - you can't pay your creditors.   Business debt negotiation is a service that is growing.  It will continue to grow as we head deeper into this economic decline.  If you are in debt you need to learn the basic principles of business debt negotiation.

Before I start talking about business debt negotiation I'm going to give you a little upside on my experiences with borrowing money. I have been in business for myself ever since I left school at 13 years of age.

My first business was cutting the grass on my neighbors lawns. I borrowed my fathers lawnmower at first, then after a couple of months of I went out and bought my own and it was a beauty. Only one of those that you push along, but that meant at least I didn’t have to buy any petrol. It was the first thing that I ever bought myself and one of the best. I graduated from gardening and went into sales when I was 16 or 17. I still worked for myself, selling life insurance from door to door…boy that was a tough job, but I loved every minute of it. I got paid only in commission so I didn't make any money unless I sold something.Throughout those years, I was always trying to earn enough money so I could buy something that would improve my business. I was far too young to approach a bank to get a loan. I opened up a bank account ok, but no way would they lend a young lad like me any of their money. So I had to get all my money by myself.

I applied for my first ever business loan when I became a tree surgeon. I had done lots of planting before that, but the only piece of equipment I had needed was a spade and transport to get to the site, a little scooter. When I started looking after the trees I needed a whole range of equipment, chainsaws, climbing gear, bigger transport, etc. So I had to visit the bank, cap in hand so to speak. I got the loan and I bought my equipment. I made sure that those loan payments were the first thing that came out of my count every month without fail. It was such a great feeling going into the bank to sign for the loan and seeing it sat in my account, ready to spend on whatever I wanted. Now, I knew I had the power to really achieve some advancement in my business if I could pay this loan off.  My need for business debt negotiation had not come to the fore.

The next loan I got was for brand spanking new Land Rover. She was a beauty. The way I figured it was, I would be able to get a better class of job if I pulled up in this snazzy, classy motor. It didn't really work out that way. This was in the mid-80s and work started falling off fairly rapidly. One-minute it seemed I had books that were bursting with clients, the next I was struggling to get the money together to place advertising in the local press.

Anyway, one thing led to another and I started to miss on payments to the bank for my shiny new Land Rover. I thought that business would pick up soon and I would be able to catch up with all the missed payments. I didn't contact the bank, I just ignored the situation.  I should have attempted even my own brand of business debt negotiation, stupid or what.  I started getting letters asking me to drop in to the bank for a nice chat. I ignored those. The letters started getting more demanding. I still wasn't getting any work to speak of so I ignored those letters as well. That's when I started getting the letters from the lawyers. Pay up or else. I couldn't pay, so I had to take the or else option, which in a short space of time involved my shiny new Land Rover being towed down the road behind a recovery vehicle driven by the repo man. And I still owed the bank lots of money.

I eventually paid my debts, carried on in my business and never had any trouble again. This is primarily because I learnt a basic lesson about business finance, if you get into trouble with your money, you should do is contact your bank straight away. I was told later that if only I could come in and talked to them about what I was going through they would have made some arrangements to defer payments for a while. I was just thinking that the whole thing would blow over. So many businesses were in the same position, the banks were having to back of from everyone.

So the first thing to do in business debt negotiation is to do exactly that - negotiate. You must let every party know what is going on. You can't keep people in the dark and expect them not to get worried. Once your creditors start to get worried in business that's when the shit hits the fan and the debt collectors and lawyers are calling on you. So after you call the bank what's next?

The next thing in business debt negotiation is you have to make a list of all your debts. That means everyone you owe any money to and everyone you are likely to owe money to over the coming months. This includes your expenses. Everything that you are going to have to pay out should go on this list.

Then you need to know roughly what income you are going to have. Your estimated figures are better than no figures. Once you have done the numbers on your income and expenses you should have a good idea how much you can pay out on debt.

If you have a whole heap of debts you might want to consider getting a business debt consolidation loan. This will take all your small high interest toting loans and consolidate them into one large low interest toting loan.

The last thing I would say, and it's something that I harp on about about in these columns is that you might consider getting some debt education. If you’ve got into debt by overspending, or by stupid spending, then you really need to start learning the basics of budgeting and how to get the most out of every buck. It's a highly competitive world out there and costs mean everything. If you don't learn fast you’re out on your ass.  I hope you have gained at least a little insight from this hub about business debt negotiation.

You should check out some of the hubs on debt bill consolidation and debt negotiation.

Also, if you want information about credit card debt negotiation for when your credit card is getting a bit too much to handle. You can find debt negotiation services in your area.