Does My Small Business Need a Debt Settlement Attorney?


Read Our Quick Guide to Dealing With Debt From a Small Business

Today’s economic climate has made tough times for everyone, especially small businesses. If delays in manufacturing, a shortage of parts, and issues with retaining employees have really put pressure on your business, then you’re probably wondering if a debt settlement attorney can help ease the amount of financial-stress you’re facing.

The answer is a little more complicated than a simple “yes” or “no.” However, we’ve got the facts you need to make an informed decision on whether a debt settlement attorney is right for your small business.


What Exactly Is a Debt Settlement Attorney?

When you’re in a bind and can’t pay your employees, vendors, or your property management company, then a debt settlement attorney can work with you to develop a comprehensive plan of legal strategies for resolving your debt.

A debt settlement attorney can also help you collect debt from non-paying clients, so you can finally get paid what you’re owed.

When Do I Know I Need an Attorney to Settle My Debt?

The most obvious way to know you need legal help with debt settlement is the inability to pay your bills on time, or pay them at all. If you answer “no” to any of the following questions, then you most likely need to schedule an appointment with a debt settlement attorney.

  • Can I pay all of my expenses without coming up short?
  • Am I able to comfortably and consistently pay monthly expenses?
  • Do I have enough funds to cover next month’s expenses?

It’s important to note that sometimes you just lose passion for your business. If you’re ready to accept that you don’t want to keep your business up and running anymore, you might want to get help filing for bankruptcy.

What’s the Difference Between Debt Settlement and Bankruptcy?

You need a specialized attorney to file for both bankruptcy and debt settlement, and the best option for your business depends on your situation.

For instance, small business bankruptcy can take care of your business debts, but it might not remove personal liability. This is why many business owners also end up filing for personal bankruptcy, which gives you the opportunity to resolve guaranteed business debt, like contracts and leases.

Debt settlement doesn’t require you to declare bankruptcy, and your attorney will work diligently with your creditors to dramatically reduce the amount of money you owe. You’ll still have to make payments or pay a lump sum of cash to your creditors, but your debt will be much easier to manage.

Do I Need a Debt Settlement Attorney to Collect Money I’m Owed?

An excellent debt settlement attorney can absolutely help you recover money that’s owed to you by non-paying clients. Here are some reasons you might need to hire a debt settlement attorney instead of a collection agency to help you get the money you deserve:

You Expect to Go to Court

You’ve been attempting to collect a debt for so long that you need a legal judgment to get your money back.

Your Client Is a Large Company

Big business has a lot of resources to fight against collections they believe are unfair. Debt settlement attorneys are well-versed in negotiating in this type of situation.

You Need to Send Demand Letters

An experienced debt settlement attorney knows how to write effective and legally sound demand letters that get your non-paying clients to finally respond to debt collection attempts.

Your Client Owes You More Than $5,000

As long as the debt being collected is more than the cost of a debt settlement attorney, it’s a good idea to get help.

Is a Debt Settlement Attorney Right For My Business? 

In general, you should always hire a debt settlement attorney whenever you’re trying to pursue large debts or seeking repayment from another business.

When you’re seriously considering paying down the debt from running your small business, it’s always better to go with debt settlement rather than bankruptcy. That’s because bankruptcy, whether personal or small business, leaves an ugly mark on your credit.

However, the only way to make the most informed decision about the direction of your finances is by scheduling a consultation with a debt settlement attorney. Only they can accurately tell you which option is best for your small business.