A few things to consider:
The "stigma" of BK can be a tough one to deal with. The reality of bk seems kinder than the expectation. If you "deal with" this outside bk but are not able to take care of it all-and fast-your credit scores will be in the toilet for even longer than if you filed.
The risks of trying to take care of all the loose ends are numerous. While you may be trying to do the honorable thing by "paying as much as you can", that path puts you at the mercy of your creditors.
Businesses fail, people make bad decisions, the market isn't as expected, or some other tragedy happens-simple as that. From a banker's perspective, your "honorable" actions mean nothing.
Without the legal protection of bankruptcy, you could be the proverbial "fish in a barrel" and find yourself sued and hounded by these creditors for years, with them winning judgments and liens against you, your wife, your home-all while YOU are doing the "right thing".
While you may not have much in the way of assets right now, I assume you hope to one day gain some. If you experience a wonderful ten year period and have a new home, flush with cash, maybe a big retirement account, guess who might come knocking? Yep, they can pursue you for a very long time. As soon as you think everything is okay, they could be there, taking it from you.
There is no honor among thieves, and even less among bankers.
With bk protection you will probably see your scores begin to improve after filing.
"Paying a little back" won't mean squat to them.
I am not saying you MUST file bk, just suggesting that if you are in as far over your head as it sounds, it might be the best way to take care of everything-and the fastest.
Your real duty is not to a bank. It is to yourself and your family. The bank knew they were taking a risk by loaning money. Most businesses do fail. The bank can account for this risk in interest and tax benefits when businesses close up shop. It is part of their carefully considered loan plans.
What is not generally part of their plan is the business owner who tries to resolve the issue little by little over a period of time. That might actually cost them more money than they would chargeoff due to your bad debt-and would take longer, with no certainty that they would actually receive anything.
In general, I am afraid it is an "all or nothing" proposition that leaves no room for the "right thing" from an ethical or moral standpoint. If you can't pony up the dough, no matter how good your intentions, they will see you in court. You can decide which court, though-bankruptcy or civil claims court.
In bk, you have the power. Not so in the civil court.
Best luck, and do let us know what you decide. I am interested to see how you proceed.
-dmc
The "stigma" of BK can be a tough one to deal with. The reality of bk seems kinder than the expectation. If you "deal with" this outside bk but are not able to take care of it all-and fast-your credit scores will be in the toilet for even longer than if you filed.
The risks of trying to take care of all the loose ends are numerous. While you may be trying to do the honorable thing by "paying as much as you can", that path puts you at the mercy of your creditors.
Businesses fail, people make bad decisions, the market isn't as expected, or some other tragedy happens-simple as that. From a banker's perspective, your "honorable" actions mean nothing.
Without the legal protection of bankruptcy, you could be the proverbial "fish in a barrel" and find yourself sued and hounded by these creditors for years, with them winning judgments and liens against you, your wife, your home-all while YOU are doing the "right thing".
While you may not have much in the way of assets right now, I assume you hope to one day gain some. If you experience a wonderful ten year period and have a new home, flush with cash, maybe a big retirement account, guess who might come knocking? Yep, they can pursue you for a very long time. As soon as you think everything is okay, they could be there, taking it from you.
There is no honor among thieves, and even less among bankers.
With bk protection you will probably see your scores begin to improve after filing.
"Paying a little back" won't mean squat to them.
I am not saying you MUST file bk, just suggesting that if you are in as far over your head as it sounds, it might be the best way to take care of everything-and the fastest.
Your real duty is not to a bank. It is to yourself and your family. The bank knew they were taking a risk by loaning money. Most businesses do fail. The bank can account for this risk in interest and tax benefits when businesses close up shop. It is part of their carefully considered loan plans.
What is not generally part of their plan is the business owner who tries to resolve the issue little by little over a period of time. That might actually cost them more money than they would chargeoff due to your bad debt-and would take longer, with no certainty that they would actually receive anything.
In general, I am afraid it is an "all or nothing" proposition that leaves no room for the "right thing" from an ethical or moral standpoint. If you can't pony up the dough, no matter how good your intentions, they will see you in court. You can decide which court, though-bankruptcy or civil claims court.
In bk, you have the power. Not so in the civil court.
Best luck, and do let us know what you decide. I am interested to see how you proceed.
-dmc
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