Today’s article is a story about how one of my client’s was able to successfully settle his debt and get his personal guarantee released. Steve (name changed to protect my client’s privacy) had a business that had failed, but was left with a couple of loans for a few hundred thousand. Discusses lessons learned.
Lessons to be learned from our success:
– Lenders fully expect you to scratch, claw, beg, and borrow to raise funds. An Offer In Compromise is not a “free pass”. If you want to be successful at a settlement attempt, you need to be willing to search every outhouse, henhouse and dog house to find money. Since the lender is likely to be taking a loss, I think it’s fair for them to expect you to experience some financial discomfort I order to settle.
– The process can be arduous and time consuming, and working with a professional does make a difference. Dealing with bankers and lawyers can be a daunting task, especially if you are not familiar with banking terminology and legal documentation. Banks will always steer you towards what in their best interest. It only makes sense that you should have a sounding board to make sure you are getting a fair deal.
– The sooner you can begin working towards a settlement, the better. While we were able to settle in this case, my client had a personal judgment granted against him, and the bank was on the verge of garnishing his wages at his new job. The judgment could have been avoided had my client brought me into the loop sooner.