We can't find an attorney

[desertplains]

Complex business chap 7 with MCAs and personal chap 7 in our funky dumb home, Dfaulted SBA 7a on business but lien on our home.

We've talked to a few of the ones that will take on business and personal BK and they said it was too complicated, and one atty just stopped responing to calls or texts.

One hopefully calls in next few days.

Ugg

[despritfreya]

Forget about a 7 for the entity. If it is "dead", it is "dead".

Concentrate on a personal case. Typical stuff for me but I am not in your State and I don't know any attnys in Wyoming.

Accessing PACER, I looked for an attorney in Wyoming that has filed Chapter 11 cases. Such an attorney should have no problem with your type of case be it a Chapter 7 or other Chapter.

Apparently, not many Chapter 11s are filed in Wyoming as there were just a handful filed in the past year. One of the attorneys was with a big firm handling big cases so, probably not in line with your situation. The other two look more promising. I don't know if you have spoken to either one but if not, you might want to call. links for both are:

https://onehourbankruptcy.com/clark/

https://www.winshipandwinship.com/

Don't forget to check with the State Bar to see of they have had any disciplinary issues and carry insurance,

Keep us posted.

Des.

[desertplains]

Forget about a 7 for the entity. If it is "dead", it is "dead".

Concentrate on a personal case. Typical stuff for me but I am not in your State and I don't know any attnys in Wyoming.

Accessing PACER, I looked for an attorney in Wyoming that has filed Chapter 11 cases. Such an attorney should have no problem with your type of case be it a Chapter 7 or other Chapter.

Apparently, not many Chapter 11s are filed in Wyoming as there were just a handful filed in the past year. One of the attorneys was with a big firm handling big cases so, probably not in line with your situation. The other two look more promising. I don't know if you have spoken to either one but if not, you might want to call. links for both are:

https://onehourbankruptcy.com/clark/

https://www.winshipandwinship.com/

Don't forget to check with the State Bar to see of they have had any disciplinary issues and carry insurance,

Keep us posted.

Des.

Thank you Des!! The atty that is not responding back advised husband to "let the business wither" We don't understand what that means nor lose our home. We have a $150 consult with Winship on Feb 3.

[despritfreya]

The atty that is not responding back advised husband to "let the business wither" We don't understand what that means. . .

I rarely believe an entity should file a Chapter 7. An entity will not get a Discharge in a Chapter 7 therefore, filing the case has little benefit except to the attorney who gets a fee. If an entity is no longer operating and no longer has any assets (all those assets belong either to the SBA for your EIDL loan or to the MCA lender(s)) and a creditor sues the entity, that judgment will not be collectable. It's worthless paper. You cannot collect from a "dead person".

As an attny, my concern is over "my people" - those individuals who will have to deal with the fallout of a failed business. This includes personal guaranties, certain unpaid entity taxes such as payroll or sales tax, etc. The type of bankruptcy (7, 11, or 13) for my person will depend upon what assets he/she has. This is why consulting with more than one attny is a good idea. Every time you do, you will learn something new and eventually, you will have a comfort level as to what to do next.

In my State attorneys who handle your type of situation are many. It appears that in your State, such is not the case. I am glad you have an appointment with one of the two I found. Hopefully, he will know how to handle your situation.

Des.

[desertplains]

Forget about a 7 for the entity. If it is "dead", it is "dead".

Concentrate on a personal case. Typical stuff for me but I am not in your State and I don't know any attnys in Wyoming.

Accessing PACER, I looked for an attorney in Wyoming that has filed Chapter 11 cases. Such an attorney should have no problem with your type of case be it a Chapter 7 or other Chapter.

Apparently, not many Chapter 11s are filed in Wyoming as there were just a handful filed in the past year. One of the attorneys was with a big firm handling big cases so, probably not in line with your situation. The other two look more promising. I don't know if you have spoken to either one but if not, you might want to call. links for both are:

https://onehourbankruptcy.com/clark/

https://www.winshipandwinship.com/

Don't forget to check with the State Bar to see of they have had any disciplinary issues and carry insurance,

Keep us posted.

Des.

Forget about a 7 for the entity. If it is "dead", it is "dead".


And he says he lost his bonding capacity and reputation for a Chap 11 to continue. Devastated, the building he bought was our retirement plan. He says the SBA 7a could forclose on our funky home. And the MCA's can too bccause of personal guarantees. he gave.

I'm so grateful for your forum!

[despritfreya]

He says the SBA 7a could forclose on our funky home. And the MCA's can too bccause of personal guarantees. he gave.

Take a deep breath and relax. There are many small (mom & pop) type businesses dealing with the fall out of COVID and other things. You are not alone.

There are two issues regarding your comments of a lien against your home:

1. I assume the SBA loan was an EIDL loan taken out by the entity. Typically, if that loan was under $150k, a personal guarantee would not have been required. Did you give a personal guarantee AND a lien (mortgage) against your home? Is this loan something other than an EIDL loan where you might have given additional collateral like a mortgage against your home?

2. Assuming the other loans were in the name of the entity, personal guarantees are nothing more than unsecured claims against the guarantors. I am absolutely sure you personally guaranteed your entity's MCA loans. But. . . while the MCA lender(s) filed UCC1s against the assets of your entity, they did not take your personal assets as collateral. MCA lenders are unsecured creditors in your personal bankruptcy, no different from a credit card. So, unless there is something out of the ordinary, these creditors will be taken care of in your personal case.

In all of my comments I am assuming that you operated your business either as a Inc. or as an LLC and that the borrower is the entity, not you. I am assuming that your exposure is based upon a personal guarantee.

Des.

[justbroke]

despritfreya, the SBA took a lien against business assets if the EIDL was greater than $25K. I don't think the personal unsecured guarantee was required until you got to $200K. One of the partnerships I was involved in took an EIDL loan which was way short of $100K. No special guarantees other than a UCC-1 being filed against the assets of the LLC. The only problem I see with personal guarantees and liens on a home is with a traditional SBA 7A loan. The EIDL loans are special creatures when it comes to the SBA. An SBA 7A loan that has attached to personal real property is a real pain.

I agree on letting the business die. If it's an LLC or other similar entity (S-Corp, C-Corp), the business should be wound down.

[desertplains]

despritfreya, the SBA took a lien against business assets if the EIDL was greater than $25K. I don't think the personal unsecured guarantee was required until you got to $200K. One of the partnerships I was involved in took an EIDL loan which was way short of $100K. No special guarantees other than a UCC-1 being filed against the assets of the LLC. The only problem I see with personal guarantees and liens on a home is with a traditional SBA 7A loan. The EIDL loans are special creatures when it comes to the SBA. An SBA 7A loan that has attached to personal real property is a real pain.

I agree on letting the business die. If it's an LLC or other similar entity (S-Corp, C-Corp), the business should be wound down.

Thank you, it is an S-corp but don't know if its EIDL How would we find out? He's gathering files from the office this week. the SBA was to buy the building the business is operating from.

[desertplains]

he signed the SBA loan in Dec 2023. A lady came to my house for me to sign documents.

[justbroke]

Sopunds like an ordinary SBA 7(a) loan. Doesn't read as if it was an EIDL loan related to COVID-19. It sounds like you are winding down the business with the SBA taking the building which partially secured the loan. The thing will be how much personal liability remains attached to your real and personal property. Hopefully you find a good attorney soon who can help you on both ends... personal and business with SBA (non-EIDL) loans involved. We had to deal with a few of them over the last two years and we always ask if it's COVID-related, FEMA-related, or a generic SBA 7A loan.

[desertplains]

I rarely believe an entity should file a Chapter 7. An entity will not get a Discharge in a Chapter 7 therefore, filing the case has little benefit except to the attorney who gets a fee. If an entity is no longer operating and no longer has any assets (all those assets belong either to the SBA for your EIDL loan or to the MCA lender(s)) and a creditor sues the entity, that judgment will not be collectable. It's worthless paper. You cannot collect from a "dead person".

As an attny, my concern is over "my people" - those individuals who will have to deal with the fallout of a failed business. This includes personal guaranties, certain unpaid entity taxes such as payroll or sales tax, etc. The type of bankruptcy (7, 11, or 13) for my person will depend upon what assets he/she has. This is why consulting with more than one attny is a good idea. Every time you do, you will learn something new and eventually, you will have a comfort level as to what to do next.

In my State attorneys who handle your type of situation are many. It appears that in your State, such is not the case. I am glad you have an appointment with one of the two I found. Hopefully, he will know how to handle your situation.

Des.

Des, I have challenges with my husband, he's friends with his employees and is worried about them when he tells them this last paycheck. Hello! What about us! I know, I know...

I didn't want him to buy the location for his business @ $6500/month on SBA. But he did. Then used MCA's.

We worked as a team for 2 decades, I played the nagging wife that made him do required unpleasant stuff. After I got sick and he supported us I thought I didn't need to play nagging wife anymore, not that he told me a lot about finances.


But we're very scared the MCA's will take our home not to mention we don't know if he will even be hired for a new job at our age so we can keep kiddo's in the same school. OMG

[desertplains]

Sopunds like an ordinary SBA 7(a) loan. Doesn't read as if it was an EIDL loan related to COVID-19. It sounds like you are winding down the business with the SBA taking the building which partially secured the loan. The thing will be how much personal liability remains attached to your real and personal property. Hopefully you find a good attorney soon who can help you on both ends... personal and business with SBA (non-EIDL) loans involved. We had to deal with a few of them over the last two years and we always ask if it's COVID-related, FEMA-related, or a generic SBA 7A loan.

The thing will be how much personal liability remains attached to your real and personal property.

Our home, and my wedding rings basically, no clue what they are worth now after 3+ decades but they weren't that much to begin with. My truck is 2005, not that great. I have ~less than $3K in stocks/crypto, not shook about losing that.

County assessor has our market value like a lot in town, except we're not in town, not water or sewer or natural gas out here,

I'm concerned about our kids! I want to keep them in the same schools, and since husband (our) business was prominent word will travel fast in a small town.

[justbroke]

If you're trying to save and keep property, a Chapter 13 may be better. Hopefully you'll be able to thoroughly review all available options with an attorney.

Businesses fail all the time. Nearly every major car manufacturer has filed bankruptcy several times. We won't even talk about the airlines. It's a good feeling to employ and try to keep people employed so that they can support their families. My thoughts are that many businesses that struggled to get through COVID-19 era restrictions are starting to feel the pain now with all the debt. At least the EIDL loans were 3% over 30 years, but a lot of other loans, like MCAs, are the death knell.

Wishing you the best.

[despritfreya]

Discuss all of this with the local attny. You have a number of options. But for the mortgage lien against the commercial building, you should not lose any assets. If the commercial building has equity, the entity (I assume it is not tiled to you) could sell it to pay off the lienholder and pay down entity debt - especially if the entity owes taxes. If there is no equity, let it go.

The MCA lenders are not taking your home. If you do nothing, they will get judgments and then they will (without domesticating the judgments in your State) wack bank accounts at big banks (Chase, WF, B of A). I tell my clients use a smaller bank like a local credit union or some obscure bank like ones you find inside big box and grocery stores. Once a bk is filed, it won't matter as the debt will be "gone".

I get your husband's concerns over the employees but if there is no money to pay the employees isn't it better to let them go so they can find other employment? Stringing them along and then not being able to pay them is not what they would want.

Again, keep us posted. Hopefully you will have some answers next week when you meet with that attny.

Des.

[desertplains]

If you're trying to save and keep property, a Chapter 13 may be better. Hopefully you'll be able to thoroughly review all available options with an attorney.

Businesses fail all the time. Nearly every major car manufacturer has filed bankruptcy several times. We won't even talk about the airlines. It's a good feeling to employ and try to keep people employed so that they can support their families. My thoughts are that many businesses that struggled to get through COVID-19 era restrictions are starting to feel the pain now with all the debt. At least the EIDL loans were 3% over 30 years, but a lot of other loans, like MCAs, are the death knell.

Wishing you the best.

Thanks, I think 13 too but my husband will have no income to qualify for the repayment plan since his business is gone. That and he's older now and the sales jobs we rocked back then are few and far between. He's submitting to jobs but no bites yet.