Foreclosure is when the lender takes possession of a mortgaged property since the borrower can no longer make payments on the real estate in question. Foreclosure is as much as a problem for businesses as it is for individuals. It’s therefore, essential to be proactive when it comes to saving your business’s property.
Here are some things you can do to prevent foreclosure:
While banks tend to be quite stringent with their repayment schedules, private lenders are easier to deal with. When your business runs into trouble and can no longer pay back the debt, get in touch with private lenders to help you refinance debt. Private lenders are known to provide funds on a short notice and aren’t as particular about credit rating.
Refinance the loan with the help of a private lender. Their loan terms tend to be more favorable and flexible too.
While loans are often secured by a collateral, a personal guarantee loan puts all your assets at risk. You are giving a guarantee to the lender that you will pay back the loan. Failure to do so puts your personal assets at risk. This type of loan buys you some time so you can look into other kinds of financing options or else risk your personal assets to service the debt.
Declaring bankruptcy is a major move and should be considered when all other options fail. When you declare bankruptcy you’re essentially stating that you can no longer service any debt and liabilities. It is designed to help entrepreneurs repay debt under the protection of the federal court, under the U.S Bankruptcy Code.
While there are three main forms of bankruptcy, liquidation is your only option when it comes to foreclosure. When you file for bankruptcy, foreclosure processes come to a halt until the court gets through proceedings.
Try to renegotiate terms
Lenders aren’t really interested in your real estate. Frankly, property is more cumbersome for a bank to deal with. They have to take on the costs of trying to sell the home and deal with all the legal aspects. Instead of succumbing to a foreclosure, try to renegotiate terms with your lender. This way you can buy some more time within which you can gather the funds required. Sell additional assets you don’t require, launch strategies so that you can improve sales, or look for lenders who provide hard money loans.
Global Partners Capital Fund is a renowned private lending firm that has helped commercial clients close lucrative deals for over 3 decades. Asset based lending is one of the many areas they specialize in and their loans can help save your business from foreclosure. They also offer hard money loans Memphis, TN for businesses in dire need. Call +1-800-514-7350 to speak with their agents.