Creditors are ringing the phone off the hook! I need options to prevent being sued by creditors, while creating start up for a small business. One has sent the sheriff over to serve papers for court. I have a small business that I may lose on this one. What else can we do?
2006-07-30 07:27:11 · 7 answers · asked by inspriration2 1 in Politics & Government ➔ Law & Ethics
The united way maintains many not-for-profit credit counselling services that will review your finances, contact your creditors and make an agreement between you.
Check out www.cantpayyourbills.org
I don't know what area you live in so I can't be more specific, but this site should give you an idea of what is available to you.
2006-07-30 07:33:08 · answer #1 · answered by No Drama 3 · 0⤊ 0⤋
You have not said whether they are suing you personally or your company. So I will outline my suggestion for each possibility:
1. You being sued personally. Don't bury your head in the sand. The problem will get worse if you try to hide from it. Make a list of all your creditors and try to arrange them into some sort of priority. for example the one that has started legal proceedings ought to be right at the top of your list to reach an agreement with.
Negotiation is the key to your problems. So long as you let people know that you don't have the money but you can pay say £2 per month until you get work, they will be likely to give you time.
In the UK you can petition for your own bankruptcy if you are in serious debt. But this itself is an expensive process and it could affect your future employment (as some jobs ask you to disclose stuff like this).
2. Your company being sued. In the UK a company has 'Limited Liability' in the event of insolvency. I am sure that there is a similar concept in US corporate law. If there is, you are not liable for the debts of the company because in law, it is deemed to be a separate entity which can be closed down due to insolvency. At least you would be able to start back again by starting a new company.
good luck
2006-07-30 08:01:00 · answer #2 · answered by Anonymous · 0⤊ 0⤋
You have the option of seeking bankruptcy protection under Chapter 7, Chapter 11, Chapter 12 or Chapter 13 of the US Bankruptcy code. The most common of these chapters for an individual debtor is chapter 7 or chapter 13. I will explain the differences below.
In a chapter 7 bankruptcy *most* debts are discharged, meaning they are wiped out and you do not have to pay them. Depending on the state that you live in, you have a certain amount of property that is "exempt", meaning you do not have to turn it over to the trustee for benefits of your creditors. Again, depending on the state, this often means your house, your car (up to a certain value) and many of your other personal property. Savings accounts and investments are usually not exempt, however. Nor are they exempt from attachment by creditors if you are sued, I might add. Some debts cannot be discharged. This includes most tax debts, child support or alimony and student loans in many cases.
In a Chapter 13, you are able to keep most of your property. However, a chapter 13 bankruptcy anticipates that you will be paying at least a portion of your debts over the next 3 to 5 years. At the end of that time, the portion which were not paid off are discharged, (again, some debts cannot be discharged, see above). A chapter 13 requires a steady source of income, and the discipline to keep it for 3 to 5 years.
You need to speak with a bankruptcy attorney in your state. He/she can advise you on how to accomplish your goal. If they think bankruptcy is an option, they will explain more about your state's exemptions and other options available to you. If you need an attorney and don't know one, contact your local or state bar association for a referral
2006-07-30 07:59:24 · answer #3 · answered by Phil R 5 · 0⤊ 0⤋
Call a lawyer they can't put a stop on this action by your creditors that will work for a short time like up to a year. If you don't know or have never used a lawyer do a google search for credit lawyer in your state.
http://www.google.com/search?num=20&hl=en&lr=&newwindow=1&safe=off&q=credit+lawyers&btnG=Search
example of my search
2006-07-30 07:42:58 · answer #4 · answered by R 2 · 0⤊ 0⤋
if someone wants to get out of debt today it is pretty easy with a debt consolidation plan
however it may get a bit tricky at times, I suggest you get as much information as possible online on this first,
a good place to start in my humble opinion is:
http://umgarticles.atspace.com/debt-consolidation.htm
2006-07-30 22:22:59 · answer #5 · answered by Anonymous · 0⤊ 0⤋
Try paying something on your debts,how can you start up a new business with all the debts you already owe .?
2006-07-30 07:33:35 · answer #6 · answered by Yakuza 7 · 0⤊ 0⤋
seek bankruptcy protection
2006-07-30 07:31:59 · answer #7 · answered by johnman142 6 · 0⤊ 0⤋