Archive for February, 2010

How to Survive this Severe Economic Downturn

Sunday, February 21st, 2010

In today’s economy, with the stock market floundering, and the real estate market getting ever worse, and with unprecedented layoff numbers making the news daily, it’s becoming evident that our economic problems are unique and not short-term as is often the case with other downturns. Most businesses are experiencing difficult times, and recent, high profile actions by the US government underscore this fact. Every day, it seems that some newscaster is announcing yet another government bailout program. A trillion here, a trillion there, a trillion sprinkled everywhere.

And unfortunately, if you are the average business owner, their definition of “everywhere” does not include you or your business. When all the Obama dust settles, you will likely get NOTHING from any of his government bailout programs. You may eventually receive a small pittance in the form of an insignificant tax break for your business or for you personally, but nothing that will fundamentally solve the problems your business is faced with.

No, the government bailouts will not be there to save your business, so you need to help yourself. You need to find creative ways to cut costs and keep your business viable. You cannot sit idly by as things worsen. You must take the initiative and make changes that will ensure your survival, and you need to make changes that will allow you to grow your business and prosper in these tough economic times. One of those changes is to negotiate with your creditors and reduce your overall debt burden. In my book, How To Negotiate With Your Creditors And Reduce Your Commercial Debt By At Least 60%, I show you exactly how to do this.

Some business owners might not yet be aware of their financial troubles. Possibly they have not yet realized just how bad things really are, how the negative groundswell of this economy is rising up to grab them and pull them down and drown them in a sea of debt. Others might be aware of it, and they fully understand exactly how bad the economic situation has gotten. Some business owners—after reviewing the ever-growing discrepancy between their payables and receivables—may be thinking that it is too late. Things have gotten so bad that their business is finished. They may feel that they are in such deep trouble that all hope is lost and there is no light at the end of the tunnel, only darkness and despair. But with all my years of experience, and knowing what I know about business and debt resolution, I can safely make the following promise to you:

It is never too late to put your finances in order.

No matter what the economic climate, no matter what your particular situation, it is never too late, and I have the numbers to prove it. During my twenty years working in the field of commercial debt negotiation, I have encountered just about every financial debt situation imaginable.  And my success rate has been phenomenal—so good in fact, that I can now show you exactly how to reduce your commercial debt by over 60%.

I’ve been doing it for other businesses for many years now.

So don’t give up hope. Many business owners are facing similar negative scenarios. A common—and very natural—reaction is to ignore the problem, but sooner or later, you will need to face the reality of your situation. In my book, I provide you with all the necessary information and techniques to insure that you are able to face these difficulties head on and make it safely through these trying times—that you are able to ride out the stormy conditions of this economy and emerge stronger than ever.

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André Larabie

Email: jcalarabie@hotmail.com
Website: www.andrelarabie.com

How to Negotiate an Out-of-Court Settlement

Tuesday, February 9th, 2010

OK, look. I don’t know about you, but it sure seems to me that this economic downturn has been going on for quite a long time. Is there anything different about this recession? Sure seems like the other recessions in recent history have not been THIS bad. Do you agree? Every time we get new unemployment numbers, they seem to be about the same, or getting worse. That means lots of companies are still struggling.

And when the economy is this bad, companies end up further and further in debt. Most business managers are caught off-guard and before they know it, the payables have outpaced the receivables and the debt collectors are at the door knocking. Many business owners don’t realize that business debts are often negotiable, even if a legal action has been initiated by the creditor(s). Here’s an article I wrote that you might find helpful if you find yourself at the wrong end of a lawsuit.

How to Negotiate an Out-of-Court Settlement

Nobody plans for their business to fail. In fact, despite the best planning, things happen that can put your business on the brink of failure. Too many payables, too much payroll, too few customer orders, rising prices for supplies and falling income can all adversely impact your business. One bad month leads into another; one small debt management problem multiplies, and suddenly you are swimming against the current. Many business owners might believe that once they are behind in payables and struggling to meet their payroll, that the business is doomed. This is patently not the case. Your creditors do not want your business to fail. After all, you are their customer, and if too many of their customers cease operating, then their own business will be threatened.

Before you consider the drastic step of bankruptcy you should consider all options available to you. It may be possible to negotiate an out of court settlement with your creditors. Your creditors are primarily concerned with recovering as much of the debt as possible, and bankruptcy judgments do not necessarily favor creditors. Because of this, any reasonable offer to settle the debt out of court will be considered. They key lies in opening the lines of communication and being willing to make an honest offer for payments. Usually a creditor will take an offer of at least 40% of the outstanding debt if it is paid within a reasonable amount of time.

Debt collectors can be aggressive and intimidating, and too often you will be left with the impression that there is no room for negotiation. Do not be discouraged by this. They specialize in getting difficult customers to pay up, and they use techniques that are designed to get you to pay because you feel there is no choice. Individual debt collectors have zero concern for what other debts you may owe. To them, all that matters is the debt they have been charged with collecting from YOU and the commission they will earn if they are successful. The only one who can balance the many demands of your creditors is you, and if you pay one in full you may end up with nothing to pay the next. In order to negotiate an appropriate settlement, you will need to be completely in command of your resources and aware of exactly how much capital you can commit to commercial debt management and the remission of debt.

Before attempting any negotiation that can lead to an out of court settlement with your creditors you need to do a complete financial review paying special attention to accounts payable and payroll obligations. Do not look only at the current amounts due, but project into the future by the minimum of one year. If you cannot see a way to clear the debt in one year, you may need to look forward two years or more. Once you know the amount of capital that is available, you can contact your creditors to begin negotiations for clearing the outstanding debt.

At this stage of the process, many creditors will push for a greater payment, or a shorter timescale for repayment. Do not give into this pressure because it will do you no good to promise a repayment schedule that you cannot meet, and if you fail in this promise, your creditors are not likely to give you a second chance. Honesty is the best policy here, and be sure to state clearly that you want to pay off this debt as soon as possible. If your creditors believe you, they will be much more likely to work with you on fixing an amount that is manageable.

Although you can negotiate with your creditors yourself, you should also consider contracting a debt settlement company. These companies specialize in negotiating with your creditors for a settlement and can usually obtain a drastic reduction in the overall debt burden. Part of how they do this is by combining your debt with that of other companies that owe money to the same vendors. The basic philosophy being that if they can get two companies to pay back 60% of the debt owed, that is vastly preferable to either of them going bankrupt and the vendor only recouping 25% from each of them. This type of debt grouping can give the debt settlement company a real advantage in negotiations.

If you choose to hire a debt settlement company to manage your debt restructuring and negotiate your out of court settlement, be careful to research the company. Most companies are reliable and have a good track record, but as in all business endeavors, there are some unscrupulous companies that will charge outrageous fees and not deliver on their promises. Before agreeing to work with a debt settlement company, check with the Better Business Bureau and Consumer Reports. In addition, don’t be afraid to ask for references. You will be trusting this company with the future of your business, so you want to be sure you are dealing with a reputable company that can truly help your debt management situation.

In the long run, you will discover that your creditors are most interested in recouping the highest percentage of what you owe for the least amount of time, effort and expense on their part. Because of this, they will almost always be willing to negotiate an out of court settlement. Be sure to ask that they suspend interest and finance charges so that you can get clear of the debt in the most expedient way possible and avoid bankruptcy court.

André Larabie

Email: jcalarabie@hotmail.com
Website: www.andrelarabie.com