How Business Debt Settlement Works
Business debt settlement involves negotiating with creditors to pay a lump sum that is less than the total amount owed. This can help settle the debt for pennies on the dollar. However, debt settlement also comes with risks, such as:
- Damage to your business credit score
- Continued late fees and interest charges during settlement negotiations
- Potential lawsuits if creditors refuse settlement offers
Before attempting DIY debt settlement, it’s wise to consult a business debt lawyer in Baltimore. An attorney can review your business debts, negotiate with creditors on your behalf, and ensure any settlement agreements comply with Maryland debt settlement laws.
Merchant Cash Advance Pitfalls
A merchant cash advance provides a business with quick access to capital in exchange for a percentage of future credit card sales. However, merchant cash advances come with high fees and strict repayment terms, including:
- Expensive factor rates often exceeding 30%
- Daily repayments regardless of sales volume
- Potential for loan stacking if multiple advances are taken
- Personal liability for business owners
Violating a merchant cash advance agreement can allow the lender to access the borrower’s bank accounts directly or pursue legal action. If you have fallen behind on merchant cash advance payments in Baltimore, contact a business lawyer right away to understand your options.
Alternative Debt Relief Options
Depending on your situation, there may be better debt relief options than settlement or merchant cash advances. A Baltimore small business attorney can explore alternatives like:
- Debt consolidation loans
- SBA loans
- Chapter 11 bankruptcy reorganization
- Chapter 7 bankruptcy liquidation
Each option has different eligibility requirements, costs, and long term consequences. For example, Chapter 7 bankruptcy can eliminate dischargeable debts, but requires liquidating business assets. Chapter 11 bankruptcy allows you to restructure debts while continuing operations, but comes with administrative expenses.
Protect Your Baltimore Business Legally
If you are ready to regain financial stability for your Baltimore business, the attorneys at Delancey Street can help. We take a compassionate approach and will thoroughly analyze your situation to determine suitable debt relief solutions. Then we handle negotiations with creditors while protecting your legal rights.Unlike DIY debt settlement attempts, our lawyers can shield you from collection lawsuits while fighting for maximum debt forgiveness. We also help avoid merchant cash advance scams by reviewing contracts for hidden fees and unrealistic terms before you sign.Relieve the stress of business debt in Baltimore. Contact us or call 212-210-1851 to schedule your free consultation today. Our legal team looks forward to helping your business get back on steady financial ground.
Frequently Asked Questions
Struggling with business debt in Baltimore? Find answers to common questions about legal debt relief options from our financial attorneys.
What are the risks of DIY debt settlement?
Attempting to negotiate business debt settlement without legal guidance is risky. Creditors may refuse settlement offers or sue if they feel you are acting in bad faith. An experienced lawyer handles talks properly.
Can I be sued for defaulting on a merchant cash advance?
Yes, failing to repay a business cash advance as agreed may prompt the lender to take legal action. They may sue for the balance or gain access to your accounts. Consult an attorney to understand your responsibilities.
What are the alternatives to high-interest merchant advances?
Rather than resort to predatory merchant cash advances, discuss options like debt consolidation loans, SBA funding programs, or bankruptcy reorganization with a legal professional first.
Is business debt settlement better than bankruptcy?
There is no one-size-fits-all solution. Debt settlement helps avoid bankruptcy’s impact on your credit and operations, but has risks too. Meet with one of our lawyers to determine the best path.
How much does it cost to settle my business debts?
It depends on your debts and state laws. Our Baltimore business attorneys offer free consultations to evaluate your situation. We also provide flat monthly fees for debt relief services, allowing you to budget properly.
Work With Our Baltimore Small Business Debt Relief Lawyers
If you are struggling with business debts and need legal guidance on relief options in Baltimore, contact Delancey Street today. Our team of compassionate attorneys offer in-depth consultations, reasonable flat monthly pricing, and customized solutions to resolve your financial hardships while protecting your rights.Call us at 212-210-1851 or schedule your free consultation online now. Our Baltimore business debt lawyers are here to help you regain financial freedom.
