Many small business owners in Florida have found themselves in the position of relying too heavily on their credit cards. At one point, many had the idea of using the credit cards to get everything started, but have since found the need to rely on the credit cards. The longer this goes on, the more and more debt the business ends up accruing.
In these types of situations, while at first many small business owners do not want to even hear the word bankruptcy, many do end up talking with an attorney and realizing this really is the best option. In fact, in some cases, filing for bankruptcy can even end up saving a business.
In deciding whether or not bankruptcy is the right option, one thing for business owners to do is to take inventory of all of their debt. Realizing how much is owed including the interest rates and monthly payments may help put things in perspective. Owners should ask themselves: Can I continue to run my business, pay down my debts and not rely on credit cards anymore?
If paying back what is owed seems like a viable option, it is important to understand how interest rates play a role in this and to payback what is owed accordingly. This means taking the card with the highest rate and paying that back first, while also making minimum monthly payments on the other cards.
For some though, the debt may just be too great. This is when talking with a Florida bankruptcy attorney can come in handy in terms of learning about the different types of business bankruptcies and their anticipated outcomes.
Source: cincinnati.com, “Control your credit card debts,” Tom Cooney and Crystal Faulker, Feb. 13, 2013