It's interesting what people will share with you when you confide that you are filing BK...
So, a friend confessed that her C-Corp is having it's 4th bad year in a row. She is the only shareholder and has several employees. She's not sure how long she can hold on and feels terrible about the prospect of closing.
Obviously future income is a concern but another is two loans that she believes may be secured by her home as well as business assets. One is an SBA loan and the other is a credit line from a bank. She has some decent equity in the home.
Using round numbers, the home is valued at about 600K, she owes 200 to her first, 65 to her second leaving equity of about 335K. The SBA is for about 150K and the credit line is for about 75K.
In Florida, I think home equity is protected. Maybe there is a limit. But I thought I read here that in this situation, the way to protect her equity (only real personal asset) would be to file personal BK and dissolve or just close the business letting the creditors liquidate assets.
If she filed (ch 7 non-consumer?) would there be a lien strip possibility of her HEL, the SBA and/or the credit line?
BTW I have advised she find a good attorney with business/BK experience (as I'm sure you all would) and join this forum!
So, a friend confessed that her C-Corp is having it's 4th bad year in a row. She is the only shareholder and has several employees. She's not sure how long she can hold on and feels terrible about the prospect of closing.
Obviously future income is a concern but another is two loans that she believes may be secured by her home as well as business assets. One is an SBA loan and the other is a credit line from a bank. She has some decent equity in the home.
Using round numbers, the home is valued at about 600K, she owes 200 to her first, 65 to her second leaving equity of about 335K. The SBA is for about 150K and the credit line is for about 75K.
In Florida, I think home equity is protected. Maybe there is a limit. But I thought I read here that in this situation, the way to protect her equity (only real personal asset) would be to file personal BK and dissolve or just close the business letting the creditors liquidate assets.
If she filed (ch 7 non-consumer?) would there be a lien strip possibility of her HEL, the SBA and/or the credit line?
BTW I have advised she find a good attorney with business/BK experience (as I'm sure you all would) and join this forum!
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