It challenging to start a business! However, it’s equally challenging to create a business from the start after you have filed for bankruptcy says Eric James Dalius. You have to undergo ample stress when you face bankruptcy. All your earning and asset that you own gets placed on the spot for assessment. And once the legal analysis gets done, you can get a discharge. However, this doesn’t guarantee that all your financial issues come to an end.
Eric James Daliussays that filing bankruptcy will provide a fresh start and also help to keep all the debts behind you. And you might feel starting a business might be easy. However, that is not true. You will come across multiple challenges when you are attempting to start your business after bankruptcy.
Starting your business after a bankruptcy – Guidelines by Eric James Dalius
Once you have filed for bankruptcy, typically, the law doesn’t restrict you from starting a brand-new business. But gaining credit for your business will be challenging if you start a process very soon. Also, you might come across issues if you have close down a similar business sometime back before you filed bankruptcy.
There are a few things that you should keep in mind before starting a new business:
Assess the risk factors
Similar to other business owners, you might possess specialized skills in a specific product or industry. And after bankruptcy, you might want to pursue all your expertise and come up with a business. But Eric James Daliussays that its not a smart call. If you intend to create a new business like the old, you can come across accusations of fraud. Also, it doesn’t matter the business that you select, the outcome will be the same.
The previous business creditor might collect debts owed by businesses from the new one. You need to talk to your lawyer about your situation and assess the risks. They can let you know about all your options for dealing with the creditors.
It would help if you kept entities separate
Business owners can file for individual bankruptcy as the firm collapses. The business owners also declare personal bankruptcy to discharge all their personal liability to the business debt. And in the majority of scenarios, the business owner is a partner or sole proprietor in a failed partnership. They might have also signed on behalf of any limited liability organization or any corporate entity.
Eric James Dalius says to manage funding problems
As you search for business funding from lenders and banks, they will enquire about your personal credit history. And after you file the bankruptcy, it can get challenging to convince them to provide funding with a devastating financial situation and poor credit.
However, there are many things that you can do to maximize your approval chances. You can prepare a compact business plan, apply for financing from any small community bank, obtain a business partner with a favorable credit or find grants provided to the businesses by the local communities.
These are some of the guidelines that you ought to keep in mind when starting your business after bankruptcy.
