Debt Workouts Are Not As Hostile And Dangerous As You May Think

Debt workouts are hostile, foreign, dangerous, uncomfortable, upside-down territory where no one wants to tread… except us. I get it. I do understand this sentiment as everyone in default shares it. No one wants to do a workout, ever. No one wants to be in a defaulting situation, requiring a workout to survive. Everyone wants to pay their debts and repay their loans. This, I understand completely.

However, the economy has tanked and there is nothing any of us can do about it. You now have debt much larger than what your business can possibly afford to repay as revenues are down significantly. Like it or not, this is your reality and no one can change it. So either enter into this hostile territory or become a victim of a different kind of hostile territory–unbearable, unsupportable debt that cannot be repaid, eventually resulting in your liquidation.

But, I actually have good news. Despite the appearance that we are dragging you into this hostile enemy territory, the reality is, it is not really hostile, foreign or dangerous. It could be, but under our control and with our strategies and guidance it is actually more friendly, not dangerous at all. I say this because our strategies are based on embracing the bank, including the bank in our strategies as a partner and acknowledging that while you are in default, we are doing exactly what we should be doing for the benefit of the bank. We comply with FDIC and SBA requirements and guidelines and understand banks and bakers and the entire system so we can cooperate and deliver what is needed while at the same time protecting the borrower from undue harm and loss. We experience cooperation in most instances and eventually win over every banker that we deal with once they determine we are really doing what we say we will do. Our workouts are an honorable pursuit, done with the banks cooperation and resulting in a positive result for all involved, even if a huge amount of debt is forgiven as a conclusion. We are, of course, well-known at the SBA and by many banks all over the country as we have been submitting successful workouts for years–hundreds of them this year alone–and they are always accepted, always, all of them. So, clearly, they know who we are and what we do and they accept our strategies and programs. No hostility, no danger.

While in general terms a debt workout is a dangerous, high-risk program in the hands of a defaulting borrower or an inexperienced professional, frequently ending in liquidation and disaster for the defaulting borrower, in our hands it is a successful win-win program with everyone agreeing to the outcome without hostility or danger. Together, the bank and we resolve difficult problems in every one’s best interest, with resolution and debt forgiveness as the conclusion. We do not–and cannot–force the bank into compliance with our strategies. We do, however, propose a “best case” result that the bank acknowledges as such and therefore resolves accordingly. This resolution also works for the borrower, but this is a fact the bank is not very interested in or cares about at all. They get what they need and move on, that is the basis of our strategy. This works very well, safely and securely, with less risk than anyone would ever imagine.

To us, a debt workout based on default and with forgiveness being the objective is a friendly, hospitable, comfortable, productive and safe business procedure to implement. Call us if you are in default or approaching default. We will help you through it.