needing help from someone owning a business

Hi, I've read the post concerning business but notice that most people close the business. I would like to hear from someone that kept the business open and was still able to file. Is there anyone on here like this? What was the outcome?
I asked this earlier but received no response. I want to keep my house and my business so I am considering moving by business cc to a secured 2nd mortgage and taking the business name off the loan if BoA will let me. Would this be considered fraud? Is this a bad idea if I was going to file a 7? My income is so low I don't think they will let me file a 13. If I request more than my cc balance and get it I would use it to make payments for the next few months before I file. Will this raise a red flag?
Thanks for any advice. I do have a attorney appt for next week but this is driving me crazy.

We closed our business so I cannot help with your first question.

But I would not move credit around especially to something secured. And I would wait on any moves until you are comfortable and educated with a lawyer.

Hang in there!

thanks for responding. I will talk to the att before applying for any loans etc. It looks like most people on here close their business before filing. Can they force you to a 7 if you're income is so low they think you wont make the min payments in a 13? A year ago an att told me my pymt would be around 210 but then business got better and I didn't file. Now my PVA on my house has increased by 12,000 and I've paid the principle down a little so a 13 pymt will be higher.
I'm just driving myself crazy with these what ifs.
Would of course like to do a 7 and keep the house and business just don't know how to make it happen.

You are right, when I first got on this board I couldn't find answers to closing a business. It is still foggy to me.

I can tell you mine though. I am a C7 Business and we had to close my DH failing biz. Even my business had to close which was not failing. I do not know if it is the atty being careful or what the trustee expects.

A C7 Consumer might have a better time at keeping a business.

You can do any work after your BK :)

I don't know enough about C13, but couldn't you file that way if you wanted? Could you handle the bigger payment? Are you sure your income will continue into a C13?

Here is a link I like for figuring scenarios:
http://legalconsumer.com/index.php

I am filing a Ch 13 and have a retail business. My attorney said I would be able to keep the business, keep my truck, my gun and my boat. Most likely, my two credit cards won't get anything as well as a small equipment lease. My truck payment and my attorney fee will be what's put in the plan. I owe about $18K on two cc's and about $2400 on an equipment lease. My business is making money but not quite enough to pay the high interest cc's which are almost 30%!!

brokenn - thanks for the link
Andyman - were your company cc effected by the bk? I'm not sure what happens to your business cc when you file personal bk. the LLC will still owe the cc but will the interest rate go sky high? Will they tack on legal fees etc.? I hope this att has some good solid answers. Right now I owe 12K to BofA in the business name but I am signed personally so they have to be included in the BK but I understand the business will still owe this debt. I'm just worrying about the interest rate and fees going skyhigh so the LLC will never be able to pay them off either. This is why I am considering switching the BofA debt to secured fixed rate 2nd on my house.
Has anyone else been in this kind of situation?
Thanks

Is it possible in a situation like this that BofA will work out a settlement to get their money paid through the LLc. Or do they know they have a good thing and will just tack on all kinds of fees thinking I will be forced to pay them through the company.

Are you a single member LLC?

Yes a single member llc. In KY you are taxed the same as a S-corp. That way Ky can collect taxes even if you don't make a profit. I obviously didn't check out all the details before the LLC. Still from what the first att told me the llc will protect a certain portion of my business from the bankruptcy.
Any advice?

brokenn - thanks for the link
Andyman - were your company cc effected by the bk? I'm not sure what happens to your business cc when you file personal bk. the LLC will still owe the cc but will the interest rate go sky high? Will they tack on legal fees etc.? I hope this att has some good solid answers. Right now I owe 12K to BofA in the business name but I am signed personally so they have to be included in the BK but I understand the business will still owe this debt. I'm just worrying about the interest rate and fees going skyhigh so the LLC will never be able to pay them off either. This is why I am considering switching the BofA debt to secured fixed rate 2nd on my house.
Has anyone else been in this kind of situation?
Thanks

My credit cards are personal and not company and I'm a sole proprietorship and not an LLC. I have a lease on my credit card terminal that I'll stop paying this month and I've already gotten set up with another merchant services that will give me free equipment.

Larryg, I had a S corp (which is what your LLC is, an S corp). My business is continuing, however I do have to close that S corp. I have a couple of cc's in the business name and they were personally guaranteed by me. I am 100% sole owner of the S corp. Because I own 100% of the business and I filed a CH 7 PERSONAL BK, the business was considered an asset. So as of the filing date 100% of all receivables belong to the Trustee. Anything earned after the filing date does not belong to the Trustee. So far, so good. However, on my schedules the debts owed by the business but guaranteed by me are personally discharged. If I continue to earn money in the current S corp name the cc companies and other people I owed the BUSINESS debt to as of the filing date can sue the corp - get a judgment and then sieze any funds in the business account. They can sieze the business account funds because I did not file a business CH 7, only a personal CH 7. So they can sieze post petition earnings from my business account. Obviously that was a problem for me.

So, in order to make a clean break, my attorney suggested that I close that corp. I am still in business. So now all post petition income goes into another account (not the same S corp) and can not be touched by anyone. Does this make sense to you?

The main question is, does the business have any assets?

I also have a small business. I was told by my attorney I can keep my business but have to file on everything. I have a mobile grooming business and have a trailer. I am a sole prop. since I didn't have $1200 to become a LLC. I have been in business 2 months and am only paying the bills for the business. By late spring I am hoping to be making a lot of money. Anyways, I was told I would be able to keep operating and keep my trailer but every debt I have will have to be filed. We are going C7

The main question is, does the business have any assets?

That is the question... In my case I am own e-commerce sites and 95% of my business is drop shipped so my only assets are my computer (Tools of the trade) and some small inventory of items that can not be drop shipped (Around $3000) - Lawyer has told me there is no issue with keeping the business. We are going BK on well over $300k in credit cards.

Did you file on your business? Or personal? or both? That is the difference. If you have $300k in cc debt under your business name and you have discharged only your personal liability for the $300k then the liability still exists for the business. I'm sure you and your attorney have discussed this extensively.

What type of business do you have? Do you have inventory? I can't just disolve the LLC and start another without proving what I did with the inventory and equipment. I do not have any receivables all sales are cash or cc.
Which brings up the next problem. I changed cc processing companies and changed bank accounts last month in preperation for this and the new bank has bought out the old bank that I have a cc with. Now I will have to find a new bank or keep my payments current until the paperwork is actually filed. Can they take money out of your account after the bk is filed?

Did you file on your business? Or personal? or both? That is the difference. If you have $300k in cc debt under your business name and you have discharged only your personal liability for the $300k then the liability still exists for the business. I'm sure you and your attorney have discussed this extensively.

My business was a Sole Prop, Amex never even had my Tax-ID only my social so all debt is considered personal since I was personally responsible. Dont think I will have any issues since Amex was quick to sell my debt... Collection company has already offered a settlement for .20 on the dollar so they must have bought it very cheap. I dont have it so we are going forward with our CH7.
.

ansky0007, then you did the right thing. Your personal filing will get rid of your debt because your debt is of a business nature but accrued under your ss rather than a separate tax id. One of the things my attorney did (which was great) was to have me file personally (name of debtor), but there is a spot right under that box that says: 'All Other Names used by the Debtor in the last 8 years' and that is were he put the S corp name.

So that would work just as well with a d/b/a (IMHO) or a sole prop

One more thing to explain. I'm not behind on any payments but this is the last month I will be able to make them. I'm not planning on stopping my payments to BofA because that is a business debt and will still have to be paid by the business. But when I file personal will they automatically try to collect the full amount by siezing my business bank account even if the payments are current? Can they do this? Will they need to get a judgement first? Can my att work out a deal with them?

If your filing why are you paying BoA? Not sure I understand. Bus and Pers all the same thing when your a sole bus owner. If you have a bus checking account with BoA I'd change that like yesterday otherwise they will take your money. Go open up an account with a small bank that doesnt have any credit cards

If your filing why are you paying BoA? Not sure I understand. Bus and Pers all the same thing when your a sole bus owner. If you have a bus checking account with BoA I'd change that like yesterday otherwise they will take your money. Go open up an account with a small bank that doesnt have any credit cards


EXACTLY RIGHT!!!:clapping:

My bank account is not with B of A but they can still try to sieze the money through a judgement. In order to keep the business open and operating the business will have to pay its debts. I am personally signed on this cc so I also personally owe this debt. When I file bk I will have to list BofA on the filing. This is when I am worried about what they will do.
In my previous post I asked if BofA could seize any funds in my business checking account but I was not thinking clearly. I know they cannot do that if I do not have a checking account with them. But if they get a judgement against the business they can so this is where I need to get a very good lawyer to handle the business as well as the personal end of this.
thanks everyone for all the help

My bank account is not with B of A but they can still try to sieze the money through a judgement. In order to keep the business open and operating the business will have to pay its debts. I am personally signed on this cc so I also personally owe this debt. When I file bk I will have to list BofA on the filing. This is when I am worried about what they will do.
In my previous post I asked if BofA could seize any funds in my business checking account but I was not thinking clearly. I know they cannot do that if I do not have a checking account with them. But if they get a judgement against the business they can so this is where I need to get a very good lawyer to handle the business as well as the personal end of this.
thanks everyone for all the help


My opionion... Stop Paying it now... I owed Amex over $190k alone and within 60 days they sold the debt. I spoke with them around 45 days out and told them we were filing CH7, Within 2 weeks of our call I was receiving calls from a collection company with offers to settle for $40k.. Get a lawyer and have them help you make a plan.

My opionion... Stop Paying it now... I owed Amex over $190k alone and within 60 days they sold the debt. I spoke with them around 45 days out and told them we were filing CH7, Within 2 weeks of our call I was receiving calls from a collection company with offers to settle for $40k.. Get a lawyer and have them help you make a plan.

I agree 100%!