It is safe to say that 2020 has been one of the most financially devastating years for most business owners around the world. We went through a global recession when countries had to go into a lockdown for the sake of containing the rate of the contagion. Of course, this massive lockdown, followed by a global recession, and ultimately massive layoffs everywhere resulted in many small and local businesses suffering. We already know how bad the restaurant and hospitality industry had been hit. Similarly, many small businesses have suffered in many ways and eventually had to declare bankruptcy. If you are considering filing bankruptcy as a business, you might want to continue reading the rest of the article.
It is important to remember before proceeding that every business owner’s finances and the overall case are unique, so things might work differently in your case and so on. Of course, you can consult with a lawyer or two before you go through with this decision since they will be better able to guide you about how your bankruptcy filing might go for you depending on your case and situation. So, always consult with a proper bankruptcy attorney before you make your decision.
If you are struggling to keep up with your debt payments and you know that you are not generating enough profit to keep up with the debt payment, then bankruptcy might be your best option here since it will put a stay order and no debt collector can come after you for payment. However, that does not excuse you from all responsibility, and filing for bankruptcy will affect your credit score and potentially future chances of opening a business and needing loans. So, there is a lot of deliberate over before filing for bankruptcy, and as a general rule of thumb, it should only be used as a last resort.