Business Bankruptcy Law | Small Business Bankruptcy Laws

Well I tried to beat the economy with a great product and friendly service but I failed to keep up with the declining business. I closed up shop and have a few outstanding debts. Electric bill, Cable and thier rediculous 2 year contract, a food vendor and a 5k loan from a company that leveraged credit card sales. My partners have bailed and changed numbers, i still answer the phone but I have no money to answer these people with. I lost my house in this whole process and had not had a pay check in several months. I just landed a decent job which I am thankful for but I cant afford to pay business debts when I have personal debts that need paid. I am curious about personal guaranty with the credit card loan people and if that would be exempt from a bankruptcy. Also would I just file for the chapter 11 on the LLC? Or do I have to file personally as well? I dont want to ruin the next 10 years of my life with a bankruptcy on my credit report but then again I have a foreclosure so what can I do?

The short story is that after a failed business, my home was lost to foreclosure, several bills mounted and I now have a means to payback debt. The other day I was successful at obtaining an agreement to pay a month on a 5k balance and it is my hope I can manage to do so with all of my debts. The monster in the closet is a 20k equity loan that was secured by my home which has no longer mine. When I approached the office I would typically make my payment to they gave me the number for the collections department and before I could even reach them DCS (collection agency) contacted me. Now I have told them that I would like to begin making payments but with my other debts that I am trying to honor being added on to monthly expenses, the old payment on the equity loan (250/mo) is pretty tough to manage. Is it possible to negotiate with these people? They offered a settlement of 13k on the 20k loan but I dont have that kind of money. I had actually hoped to go through the same company I had the loan with perhaps get it back in good standing in hopes that it would eventually help me to recover my credit status after being rocked by the foreclosure. any thoughts? I want to avoid bankruptcy, heck I think after I get my taxes back it would put me over the Median income for my small family of just my son and I anyway. Not sure what to think about chapter 13 either.
Update….Debt consolidation loans are out of the question due to lack of credit score. The debt is not credit card debt though it seems like everyone wants to help people out of credit card trouble. It’s utilities, a couple business debts and the dang equity loan. I need a dependable car and have to use the income tax to buy one. If I buy a decent used car I can lose it to bankruptcy, if I go chapter 13 it seems like I have to live how the court tells me to live and would have no money beyond living expense and with a 9 year old child to raise that is impossible.

-Have owned a franchisee for 2 years (it’s a corporation, INC)
-Have maxed one credit card under the business name (which is also personally guaranteed)
-Have borrowed money from personal credit cards
-Owe Employee, Sales and Quarterly Taxes
-Owe Royalties
-I am one month behind on lease

-I can’t run the business anymore and I am completely out of money to try to recover. Every day the business is open is putting me more in debt. I don’t want to fall behind on payroll.

I spoke to personal Bankruptcy lawyer. He suggested to either file for personal bankruptcy since the business credit card is also personally guaranteed (so all the business debts will roll over to personal anyway) and involve my spouse.

The lease of the shop is under the Franchisor name. I am just a subleasor.

We are doing the paperwork now. Can I just close the shop down starting January 1, 2008? to avoid getting more in debt?

What are your opinions? What are the pros and cons of this?

thank you for your help!

need to file as the last large client left standing is now closing their doors. Up to our neck in business debts & lawyers want to charge large amounts. If we had the money to pay a lawyer, we wouldn’t need to file BK. Surely there is a way to file docs ourselves or a very inexpensive way.

-Have owned a franchisee for 2 years (it’s a corporation, INC)
-Have maxed one credit card under the business name (which is also personally guaranteed)
-Have borrowed money from personal credit cards
-Owe Employee, Sales and Quarterly Taxes
-Owe Royalties
-I am one month behind on lease

-I can’t run the business anymore and I am completely out of money to try to recover. Every day the business is open is putting me more in debt. I don’t want to fall behind on payroll.

I spoke to personal Bankruptcy lawyer. He suggested to either file for personal bankruptcy since the business credit card is also personally guaranteed (so all the business debts will roll over to personal anyway) and involve my spouse.

The lease of the shop is under the Franchisor name. I am just a subleasor.

We are doing the paperwork now. Can I just close the shop down starting January 1, 2008? to avoid getting more in debt?

What are your opinions? What are the pros and cons of this?

thank you for your help!