If you suspect that your company is on the edge of bankruptcy, you’ll be happy to know that a business proposal for bankruptcy might be the solution for getting rid of your debts.
This option also allows you to continue carrying out your business activities while also putting a stop to creditor harassment, so that, under certain conditions, you can pay off your debts without declaring bankruptcy.
Scraping together money during a financial hardship is a real challenge. If, however, all you need is more time, the business proposal for bankruptcy is your way out.
Read on to learn more about the business proposal for bankruptcy and whether your company is eligible. Our experienced financial recovery counsellors also provide you the steps to follow to take advantage of this option.
What is a business proposal for bankruptcy and who can use it?
Offering more flexibility than commercial bankruptcy, the business proposal for bankruptcy is the ideal solution for businesses looking to buy a little more time.
The business proposal for bankruptcy is an agreement between your licensed insolvency trustee and your creditors. The agreement allows your company to carry on with business as usual while readjusting your monthly payments according to your company’s ability to meet its obligations.
With a business proposal for bankruptcy, everyone wins—both your creditors and you. In addition to freeing yourself of your debts you can keep your business in operation. This proposal also earns your creditors more money than they would have made had you opted for bankruptcy.
Any company with more than $1,000 of debt and that cannot fully meet its financial obligations is eligible for a business proposal for bankruptcy.
The business proposal for bankruptcy: Step-by-step
A business proposal for bankruptcy can be the answer to your company’s financial challenges. Here are the steps to follow to get yours:
- Consult with a licensed insolvency trustee who will determine whether your company is eligible before getting started;
- Filing a notice of intention to inform your creditors and to avoid any legal action against your company;
- Filing the actual proposal;
- All legal action against your company is stopped (garnishments, pursuits, payments, etc.);
- Your trustee presents the business proposal for bankruptcy to your creditors;
- Meeting of the creditors;
- Approval of the business proposal for bankruptcy;
- Reimbursement of the amounts agreed upon in the proposal;
So, is the business proposal for bankruptcy the ideal solution for your business? It all depends on your ability to meet a part of your obligations, the value of your assets and your financial record. Still, before considering bankruptcy, it is always advised to consult a licensed insolvency trustee to see if you have other options.
For more information on the business proposal for bankruptcy, don’t hesitate to contact N.Séguin Inc. today. An experienced member of our team will be delighted to answer all your questions.