Author name: Hira Parveen

When a corporation ceases operations or collapses, lots of business owners think that their liabilities are gone as well. However, as a matter of fact, debt does not just disappear when the business shuts down. The debt collectors can still seek payments, based on the category of a company, the nature of the debts and the person that guaranteed the debt. Can Debt Collectors Come After a Company That’s Dissolved? This is a complication that we will discuss. Understanding What Happens When a Company Is Dissolved Liquidating a business is an official process of shutting a business. The dissolution of the business leads to the organization being no longer active and is not able to carry out any trading activity and, as such, has to clear all the outstanding debts and obligations to undergo dissolution. Nevertheless, this last process is overlooked by most of the owners or they end up liquidating their companies with some debts outstanding. To trouble comes at that point– since, when compounded with dissolution, the debt is not necessarily wiped out. When you close down your business and still have some business debts, the debts do not disappear. The lenders and debt collectors will still have legal recourse particularly in situations where assets were not effectively sold off or where the owner personally owed the debts. The Value of Business Structure in the Debt Responsibility The nature of the business that you owned is a key factor that will make or break the possibility of collectors still being able to come after you or your company. Sole Proprietorship Under the sole proprietorship, the owner and the business are not legally separate. It is an indication that all debts are personal to the owner. The collectors can sue the owner even after the business is closed or dissolved. They have a chance to collect the debt using personal property like a bank account, vehicle, or property. Partnership In partnership, individual partners can be held personally responsible towards the debts of the firm. These obligations cannot be destroyed by the dissolution of the partnership. Creditors are allowed to proceed with seeking outstanding sum against any partner. Limited Liability Company (LLP) The protection of LLC is partial. When the company is dissolved in a proper manner and the debts resolved in the liquidation process, the collectors will usually have no choice but to attack the members personally. Nevertheless, the owners are still liable in case they signed personal guarantees or did not properly dissolve them. Corporation There are corporations that are distinct entities. When the corporation is dissolved in a lawful manner, and the debts are not paid, then the collectors may only place a claim on the remaining assets of the corporation – not on the shareholders/directors themselves. The exception is in the situation when it is due to fraud, mismanagement or personal guarantee. Actions that Debt Collectors Can Lawfully Take following Dissolution When a company is dissolved, debt collectors have certain limits, still, they may pursue it under some conditions. Here are common scenarios: In case the debt was secured by the hand of the individual:A large number of business loans, credit cards, and leases will require the personal guarantee. Then the guarantor can be chased by the collector in the event of the company being gone. In case dissolution has not been done correctly:Not informing the creditors or making final documents may result in your company having debts that are not closed. The issue can be reinstated by the collectors who can sue to recover the outstanding debts. In the event of a fraud or other misconduct:Owners may be sued in court on fraudulent transfer or bad faith in case the dissolution was committed to evade the payment of debts. In case the assets had been dispersed prior to paying off debts:The law permits collectors to recover the owners in cases of the remaining assets spared amongst owners without compensating the creditors. In simple words – a dissolved company, technically, may be dead but may also have a heartbeat on the financial liabilities grounds. What is the Length of the Pursuit Period of Debt Collectors? The period within which debt collectors are allowed to collect the debt is called the statute of limitations. It differs according to your country or state. The debt collection period in the United States, for instance, takes between 3 and 6 years on average depending on the state or the type of contract. The collectors can still collect at that time but this cannot be imposed on them legally in a court. Nevertheless, by neglecting the debt or dissolving the business to avoid paying may continue to reflect on your credit and reputation and future businesses. What To Do in Case Collectors Approach You Post Dissolution? When communicated to by a debt collector of a business that has been dissolved, the following is a wise way of dealing with the same: Verify the Debt News: It is necessary to always verify the validity of the claim. Ask to have written down that the debt does exist, and that your business is liable to it, and that you are personally liable to it. Check Your Dissolution Papers Enquire whether your company was duly dissolved. You may still owes creditors even as you had not notified them. False claims can be avoided by proper documentation. Consult a Legal Expert An attorney specializing in business or debt may look at your case to determine whether you are personally liable or whether the collector has gone beyond his/her legal boundaries. Avoid Verbal Agreements It is not advisable to promise or make partial payments without a written agreement. This would re-establish the statute of limitation and more time would be allowed to the collectors to chase you. Secure Your Credit and Future Business Uncleared debts in your old company may haunt you in case you decide to open another company. Get all legal issues sorted before proceeding to your next business. What Happens to Business

It may be pressure to deal with excessive debt. When people are receiving collection calls and bills begin to accumulate, many would consider recruiting a debt settlement lawyer. However, the biggest question should be asked first, which is how much does a debt settlement attorney cost? Knowing their charges, the services they render and whether they are worth it can assist you to make the correct financial choice. What Does a Debt Settlement Attorney do? A debt settlement attorney makes you negotiate with the creditors so that you pay less money. The lawyer strives to settle your debt, rather than paying it in full, by means of a settlement – which often is a lump-sum payment that closes your account at a discounted price below the full amount. They even guard your legal rights ensuring that collectors do not harass and threaten you in an illegal manner. An experienced lawyer can go through your contracts, scan your credit report for mistakes and take you through the optimal procedure of paying or reorganizing your debts. As an illustration, when you are being sued by creditors, you can have your lawyer represent you in a court of law and may prevent seizure of assets or garnishment of salaries. The Cost of a Debt Settlement Lawyer? The fee charged to settle a debt is determined by the experience, the complexity of the case and location. There are however three common methods of billing which are mostly utilized by most attorneys; Flat Fee: There are a lot of lawyers who offer one fee at the beginning of the whole process. This may be at a cost of between $500 and $3,000 depending on the number of creditors. Hourly Rate: There are those lawyers who charge on an hourly basis usually ranging between 150 and 400 per hour. This alternative can be more relaxed in case your case is not complicated or it needs less negotiation. Percentage of Debt or Savings: Some attorneys charge a percentage of the overall debt repaid or the saving. To illustrate this, say they pay out a loan of 10,000 in $6,000, you may pay a percentage of 15-25 of the saving of this 4,000. Never proceed without asking a written commitment to be clear on the fee structure. Factors That Affect the Cost There are various considerations that dictate the amount of money you will spend on the lawyer you settle your debt with. The kind of debt, the number of creditors and the total debt all determine the overall cost. In case you hold several credit cards, personal loans, or medical debts, your lawyer will take longer to negotiate with each of the creditors. The place is also important, as lawyers in big cities are more likely to charge higher than those in small towns do. Can also be the willingness of your creditor to settle costs. In case creditors are aggressive or unwilling to negotiate, the process will be lengthy and costly. Lastly, the success of your lawyer and experience might warrant a higher fee. An experienced lawyer who has won a number of cases may cost you a lot of money but in the long run they may save you a lot of money. Is It Worth Hiring a Debt Settlement Lawyer? In the event that you owe a big sum and you are being sued or are receiving an array of calls by debt collectors, it is quite helpful to get a lawyer. They know the law of debts, they can prevent harassment by creditors and they usually get better deals than those who negotiated independently. Non-profit credit counseling or doing the negotiations yourself, however, might be an option when your debts are minor or you just have a few accounts to negotiate. A lawyer will prove to be particularly useful when you: Although it is expensive to hire an attorney, he would save you the expense of falling into mistakes that would end up costing you a lot of money in the future. Is a Debt Settlement Attorney Cost Effective? Yes, absolutely. A lawyer can also in most instances talk the interest rate of your total debt or interest down. In the case of unsecured debt, suppose you have a debt of $20, 000. Your attorney can settle on the settlement of up to $12,000. You might even save 6,000 dollars on top of your legal fees which you already paid (2,000 dollars). Moreover, a lawyer makes sure that all the agreements are legally documented, so that a creditor cannot seek to recover the rest in the future. Competitions to Hiring a Debt Settlement Lawyer One can use alternatives to legal fees, as long as your budget cannot afford it. You might use a debt settlement company, and the only thing that I would do with that would be to be careful because certain companies will charge high fees and that will negatively affect your credit rating. The other alternative is to consolidate the debt, which is to convince several debts into a single loan having smaller interest. Another way is to find out repayment plans with a credit counselor who may offer you a free consultation. Nevertheless, such services do not represent you in the court nor can provide legal protections as a licensed attorney. How to Select the appropriate Debt Settlement Attorney? In seeking a lawyer, one should seek a lawyer with experience on the area of consumer debt. Check references, request client referrals and ensure that they are licensed in your state. Avoid anybody who promises a particular result or forces you to make upfront payment without a written agreement. Professionalism is represented by transparency and openness. Ask questions like: The selection of an attorney may result in a debt relief success or even the failure to repay the debts. What is the Impact of Debt Settlement on your Credit? Paying the debts, which temporarily lowers your credit score, is due to the fact that creditors can report your account

The purchase of a home is one of the greatest financial achievements in life. However, if you already have debts on credit card, loans, or other debts, then you may be curious whether debt consolidation is going to help or hurt your likelihood of getting a mortgage. The fact is that debt consolidation may either affect your capacity to purchase a home either negatively or positively, depending on how you do it and when. The connection between debt consolidation and home purchase is one thing that can be understood to make you make good financial decisions prior to applying to be a mortgage holder. We shall discuss its functionality, what the lenders are seeking and how you can prepare to increase your chances of being approved. What Is Debt Consolidation? Debt consolidation refers to an act of pooling various debts (credit cards, personal loans or medical bills) into a single loan or payment. The primary objective is to make the repayment easier and preferably get a low interest. Some of the frequent methods of consolidating debt are through taking a personal loan, a balance transfer credit card or a home equity loan. Through pooling of various debts, borrowers would find it easy to control their financial status and concentrate on paying a loan rather than moving between several dates of payment. But with the debt consolidation, as it alters your credit history in general, you should know how it impacts your mortgage application. The impact of Debt Consolidation on your Credit Score One of the most important factors that the lenders consider in giving a mortgage is your credit score. The consolidation of your debts may and may not positively affect your credit, but it all depends on the timing and the type of debts consolidation you may opt to go through. When you submit a loan request to consolidate your loans, the loan provider conducts a hard credit check, which temporarily demeans your credit score allotment. Another factor that can affect your score is that opening a new credit account can also lower your average account age. Nonetheless, as soon as you start to pay off regularly and on time to your consolidated loan, your rating can begin to increase gradually. The reason is that history of payments and less use of credit (what percentage of available credit you are using) constitute a big part of your score. As long as you use your consolidated loan in a responsible way, it will not take long to get your credit score back, not to mention the fact that it might even be even better than before. Debt Consolidation – Can You Qualify to Buy a Mortgage? Yes – debt consolidation may allow you to get a mortgage provided that it is utilized in a strategic manner. Mortgage lenders scrutinize very hard your debt-to-income (DTI) ratio, which is a ratio of debt payments that you make monthly to your gross monthly income. A low DTI indicates that you will be able to afford as well as deal with other financial commitments, like a mortgage. Your DTI ratio can also be improved by combining high-interest debts into a single manageable loan at a reduced monthly payment, which will make you attractive to lenders. It is also financially disciplined – a major aspect that the lenders consider when evaluating those who want to be lent money. But timing is everything. When you commit to consolidating immediately before submitting a mortgage application, your credit report will indicate a new loan account, which will temporarily put off lenders. Preferably, you ought to bring together and normalize your finances, at least half a year prior to making an application of a home loan. When Debt Consolidation Might Hurt Your Chances? Consolidation of debt is not always good in the short run. You may end up in new debt immediately before you are about to secure a mortgage and this may make the lenders raise eyebrows. They might perceive it as an indication that you are having difficulties with handling the current commitments. Also, your new consolidation loan will add to your overall debt, and when you make any defaults it might hurt your credit score and DTI ratio. The lenders may become convinced that you heavily depend on borrowed money because you utilize high rates or continue to apply new credits frequently. In a nutshell therefore although it is true that debt consolidation may raise your financial profile in the long run, bad timing or default may cause an interim reduction in your mortgage approval rates. Best Time to Consolidate Before Buying a Home It is always a good idea to settle debt long before you are planning to purchase a house. This will allow your credit score to rebuild and show it is financially responsible. An objective of paying off your consolidated loan on a regular basis over a few months should be made before you submit your mortgage application. Also, you do not want to acquire new debts at this time like automobile loans or a new credit card because every more loan you take on, the higher your DTI will be and limit your ability to repay the mortgage. It is also good to have a look at your credit report and see any discrepancies and check your score monthly. The difference in interest rate you can get can be big even by small points. The Lender Perceptions towards Debt Consolidation Debt consolidation is not necessarily looked upon as a bad thing by mortgage lenders. Most people in fact value borrowers who are prolific in managing their debts and making efforts to make the repayment process easier. Consistency is most important to the lenders, to pay on time and to maintain a low amount of debt in comparison with your income. They also look at your general financial status such as stability of income, employment history and savings. Therefore, in case consolidation will assist you to be in charge of your money

A title loan may seem like a quick fix when you have to get cash and in the shortest time possible. Those loans enable you to take a loan citing the title of your vehicle as a security. However, to make sure that you would be approved quickly and easily, there are several documents that you should prepare before you apply. Having the knowledge of what is needed does not only save time but also helps to avoid delays which may cost you a precious opportunity. Wondering what you need to get a title loan, you have as well come to the right place to get all the documents you need to show ownership, ID, and any other documents needed to be approved by the lenders without any fear of being rejected. What Is a Title Loan? Title loan is a short-term secured loan which takes the title of your car, motorcycle or truck as a security. This implies that you are provisory transferring possession of your car in lieu of a loan. Your level of borrowing will be based on the value of the vehicle, its condition and equity. As long as you continue driving your car, the title is retained by the lender until the time you pay the loan. Such loans are normally applied in emergency costs, bills or temporary cash crises. Nevertheless, being the high-interest and short-term ones, they must be taken with moderation and a full knowledge of the conditions. Why Lenders Require Documents? Title loans are secured, a lender is required to verify the ownership and the car is not given to another loan or lien. A good documentation safeguards you and the lender because it will establish the fact that the asset is legally yours. It also assists in confirming that you can repay, the authenticity and that the vehicle complies to the legal lending criteria. The lender cannot go without proper documentation, which is why it is necessary to prepare all the necessary documents and apply to it. Primary Documents that are needed to secure a Title Loan The vehicle title is the most valuable document in case of title loan – it should be in your name, it cannot have any lien against it and it should be registered. But that’s just the start. We are going to discuss one by one of the documents required and its importance. Title (Proof of Ownership) of Vehicle The loan process is supported by the vehicle title. It entitles to show that you are a lawful owner of the car, truck, or motorcycle, which is used as collateral. The lender will put a temporary lien on the title until the loan period is over and the lien will be removed after you pay the entire loan amount. Unless your title has been clarified to include only you, the lender or co-owner, then you will have to clear before you apply. An unencumbered title is fast to approve. Government-Issued ID To identify with the lender, you are required to show a valid photo ID issued by the government, e.g. the driver license, passport or state ID. This measure helps to avoid fraud and make sure that the applicant and the car owner are one. In other instances, when the vehicle is registered in a business, the lender might require the presentation of more documents to confirm the ownership and right to borrow in the business. Registration and Insurance of Vehicles Your car has to be insured and registered under your name. The lender can perform a check of your registration to ensure that the details on the vehicle are similar to your title and ID. Insurance is also very essential as it provides protection to the lender and you in case of any damage or accident in the term of a loan. Some lenders would not grant you with your application unless you are actively insured. Proof of Income Even though there are title lenders who do not at all insist on the verification of income, majority of the responsible ones do. They would want to see that you have a stable income to pay back the loan within the right time. You may submit latest paychecks, financial records or invoices of self-employment. There are also instances where evidence of social benefits, or pension revenue can also suffice. An income demonstration can also increase approval rates and potentially improved conditions. Proof of Residence Most lenders will require evidence on your residence, to confirm your address. It is significant in terms of contacts and adherence to lending standards. You may use latest utility bill, lease agreements or mail where your name and address is listed. In case you have just moved, remember to carry copies of both previous and new locations of residence so as to prevent instances of confusion during the check-in process. Photos or Inspection Report of Vehicles Most lenders insist on pictures or a physical inspection of the vehicle to ensure that it is in good shape. This will assist them in determining the present value of the same in the market and making sure that it is in line with the description you have on your title and registration. Online title loan companies are accepting of online photos rather than on-site. It is important to get the exterior, interior, odometer, and VIN (vehicle identification number) that will be accurate. The title loan application can be expedited in several ways In order to be approved within a short time, make sure that your documents are precise and current. The process can be slowed down by even minor errors, such as typing in an incorrect name or an incorrect address. It is always good to carry original copies and in case, scanned copies can be easily submitted. It is also used in communicating with the lender in advance and requesting them to send their documentation checklist. All lenders are slightly differentiating in accordance with local regulations and company policies. Online pre-application saves time

Construction or redesigning of property may demand urgent and fast funds. The usual take too long as traditional banks are demanding and require strict documentation, a long approval process and a perfect credit score. A hard money lender construction loan is the ideal solution to the developers, investors, and builders that cannot afford delays. It is flexible, quick approvals, and funds specifically aimed at individuals who know the speed of the real estate. A hard money loan is not simply a panacea – it is a strong financing tactic that assists the investor to seize opportunities that others may falter. We shall see how these loans are, to whom they are directed, and what is the reason they have become such a reliable instrument in the building and real estate industry. What is a hard money lender construction loan? A hard money lender construction loan is a short term loan to finance a building or a renovation venture. This kind of financing is offered by the private investors or lending companies as opposed to a traditional loan by the bank. The property is being built or improved under which the loan is secured as opposed to the credit, or income of the borrower. The property itself is in other words the collateral. This enables borrowers who might fail to satisfy the conventional lending requirements to be able to borrow. Real estate investors, flippers and developers are particularly fond of hard money loans, as they require funds urgently to start construction or do the same project that is already in progress. How Does a Hard Money Construction Loan Work? A hard money lender will inspect the property value; especially the amount of money the property is likely to fetch once it has been repaired (ARV). This is the approximate value of the property once after construction or renovation is done. The lender will determine the amount of loan to give out based on this value. To take the example, when you have complete project that is supposed to fetch out $500,000, the lender may fund it at 70 percent of the entire amount, and you receive funds of 350,000. The financing is typically provided through installments, or draws, when each project stage is accomplished. This arrangement would keep the project within the schedule and keep the risk of the lender within the bounds. After completion of the project, you may sell the property or refinance it by taking a standard mortgage repaying the hard money loan. Why Does a Hard Money Lender Be Better than a Bank? Speed is the primary reason why developers and investors get attracted to hard money lenders. Construction loan approval by traditional banks may take weeks or months, whereas, in most cases, a hard money lender will approve and fund a construction loan in just a few days. Moreover, the hard money lenders are more concerned about the future of your project rather than your credit history. This best suits borrowers who may have irregular income, low credit scores or those operating on different projects at the same time. Hard money loans are more accommodative as well. The lenders that operate privately are able to tailor the terms of the loans, flex the rates of repayment and even with some unusual projects which are usually not accepted by the banks. The major Advantages of a Hard Money Construction Loan Hard money loans have a number of benefits to real estate investors and builders: They enable you to get swiftly upon an opportunity which promises a profit. Real estate timing is everything and access to funds instantly can or can break a deal. These loans are secured by property, and hence more of the attention of the process is on the property rather than the credit report or income statement. Flexibility is also another significant advantage. Hard money lenders have the capability of funding residential or commercial real estate projects, land development, or property flops which banks may turn down. They know the real estate markets more and are perhaps more willing to negotiate on the project-specific needs. These mortgages also enable you to borrow on the potential value of a house rather than on its present state. It comes in quite handy when it comes to renovation or fix-and-flip work where property value will increase tremendously as soon as there are improvements. Drawbacks You Should Know Although the benefits are obvious, one should be familiar with the trade-offs. The interest rates charged on hard money construction loans are usually high and may be between 8-14 percent as opposed to normal loans. They also come with reduced repayment periods which are usually 6 to 18 months. Due to these aspects, hard money loans are most suitable in short time projects that are capable of producing quick returns – the flipping of a house or the completion of a build that one intends to sell. In case you need long term funding, then it is better to refinance into a conventional mortgage when the project is complete. Who ought to take a Hard money Construction Loan? Hard money loans are targeting the professionals who know how to deal with real estate time schedules. They suit best developers of small residential properties, investors who are buying and selling properties, or even constructors that require a bridge loan until longer finance sources are secured. They also can be used by buyers who can find incredible offers on distressed or underrated properties. The poor state of the property will be rejected by traditional lenders but hard money lenders will look at its value in the future and will therefore find it easy to borrow funds to renovate it. How to Find a Trustworthy Hard Money Lender? It is important to select the appropriate lender. When seeking a lender, one should always seek someone who has experience in construction financing and who has a good review of their clients. The aspect of transparency is important – enquire on every fee, interest