For all struggling companies, the dead-last option before pulling the plug on a business should be Chapter 11 bankruptcy. According to recent statistics, approximately four out of every five businesses that file for bankruptcy are not able to make a comeback.
Many experts feel a much more reliable alternative to bankruptcy is debt restructuring, which allows companies who are facing financial issues to negotiate with creditors to modify its delinquent debts in order to continue operations. Debt restructuring keeps a business active without them having to deal with the legality issues of a bankruptcy claim.
With debt restructuring, a company works on lowering debt payments but also extend loan terms to get by. It’s not quite a deferment of sorts, but it does allow the company to continue functioning while paying smaller monthly payments. In order to qualify for debt restructuring, most companies must show proof to creditors and loan officers that they are in need of immediate assistance but also show that their profitability has sound potential to improve in the near future.
In the eyes of some, most business should do everything possible to insist that bankruptcy is a last-ditch option. Let our Plano TX attorneys assist you with all debt restructuring questions, in addition to other commercial and business litigation issues. Call our Plano bankruptcy law firm today, or contact us online for more details.