Debt is something that affects almost everyone at some point in their life. It doesn’t always have to have negative connotations either. A lot of people are forced to take out what is known as good debt, like loans to pay for a house or to afford a child’s college education. But then there is bad debt, such as when your company has fallen on hard times. Whether you own a healthcare business, a veterinary company, an ophthalmology business or a dental practice, your best option may be to sell your business.
One option for trying to claw your way out of the red is debt consolidation. You get an unsecured (no collateral provided) or a secured (collateral provided) loan at a low interest rate to pay off your debts that have a higher rate of interest. It mainly depends on where your, or your business, credit scores stand. The better the credit, the better of a deal you will be offered from loan lenders. The benefits of consolidating your debts are an interest rate reduction, lower monthly payments, and a gradual improvement in your credit score over time as you pay off the loan. This may be an option if you are trying to avoid selling your business.
A second debt relief option is a debt settlement plan. For this plan you must contact a settlement agency or a law firm to discuss your financial situation and future goals. If during your consultation it is decided that settling some, or even all, of your unsecured debt is a cheaper option then your current plan, then the company will create a trust account for you. They will then negotiate with your creditors to see if they can settle the debt for less than what you originally owed or with better terms. Benefits include a smaller amount to pay back and the potential to be out of debt sooner than a debt management program and bankruptcy.
A third option is a debt management plan. If, instead of opting to settle your debts off, you decide you just want to try and manage them more efficiently then you can contact a credit counseling organization. They will offer you debt counseling and advice, as well as help you create a practical budget based on your situation. They can even negotiate some with creditors, not to get rid of the amount owed like debt settlement, but at least to possibly lower the interest rates some. This method also eliminates any late fees or penalties that have occurred, sets up a manageable debt payoff time frame of less than five years, and brings delinquent accounts current again.
Finally, we come to the idea of selling your business. You’ve no doubt invested years of effort into your company and may be reluctant to let the business go. It may, however, be the right time and right decision. If you’ve ever wondered how to sell your dental business or other healthcare company, you will have many ideas and misconceptions about the process. You’ll want to contact a firm that specializes in buying small to mid-sized businesses like yours. A company such as New Orchard Capital can help here. Their goal is to actively manage and operate a business, supporting its development and growth.
These are all viable debt-relief options. Just remember that they are not without their individual drawbacks. Some often involve paying extra fees and charges for the outside assistance you receive. And if you have bad credit then the interest rates will be higher and the amount offered to borrow lower, making them still useful but less appealing.