We recently closed a number of  SBA guaranteed loan workouts with stunning conclusions.

The first reducing a client’s debt from $1.8 million to $800,000!  A million dollar reduction in debt!  Much can be accomplished with a viable workout strategy.

We did it again! Another successful workout with over a million dollars of forgiveness with an $80,000 payoff!

…and then again, a 1.1 million dollars debt worked out with a $75,000. payment!

Another interesting result was with a client who owes $1.7 million, and needed time to re-organize as we worked out his debt, and while we  certainly intend to submit an aggressive Offer in Compromise, we needed a few more months so I successfully negotiated a $100. per month payment for 6 months…Wow. Anything can be accomplished….We will workout the debt as well, when we are ready.

Of course, we have many many smaller loans that are handled in a similar manner. We also recently resolved a $348,000 defaulted loan for $12,000. although in this case the business ws not worth continuing, so it was the personal guaranty that we resolved without preservation of the assets.

That’s the point of all my work, protecting assets, reformulating today’s debt so your business is able to support today’s business environment and conditions, which are much different then what they were three months ago, a year ago, many years ago, when the debt was incurred and the condition of  our economy was very different and  the borrower had much higher gross revenues and of course stripping of the debt and resolving the personal guaranty.

The right workout affords the business an opportunity to keep running, able to support its debt while operating at break even, or better without the burden of debt service, allowing the new business  an opportunity to pursue ways to grow and expand in today’s economy without excessive debt.

This down economy is not a temporary speed bump that’s likely to correct itself in a few months if only we can hold on, it is a systemic change in our economy.  What we have today is what we will have to contend with for a long time before our economy can correct itself, and then it will not be a rapid return to where it was, but a slow growth out of the deep hole we are in. Debt must be reduced to survive.

I see a ten year cycle before we return to where the downturn began, so batten down the hatches and do your workout so that you too can focus on business development.  Attempting to  survive with an impossible debt structure sinking your ship is not a winning strategy.

The mission is  first a debt workout, then to tighten up the  business, and  add the systems and strategies necessary to support survival and growth in a long term down economy.  Only those businesses managed very well, with appropriate work incentives, financial reports, training programs, adequate profitability, etc., will survive and prosper.  It is not enough to simply cut your debt and continue to manage as before, both ends must meet in the middle.  Debt reduction and management improvements, both are required to survive and prosper in today’s down economy.

Call my office at 413-584-2581 if you’d like some help with this.  Norm will arrange a no obligation teleconference for us to discuss your issues.

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