How to prevent creditors knocking at your door
Mr Bankruptcy
30th September 2022
If you’re concerned creditors may be about to act against your business, especially in the light of the Government’s recent ‘mini-budget’, here are some actions they can take and what you can do to about it.
What actions can creditors take?
When trying to retrieve debts owed to them by a business, creditors have several options to choose from:
- County/High Court Judgement
If you fail to repay debts, a CCJ/HCJ is a court order that can be registered against you. It will impact your business’ credit rating for 6 years if the debt isn’t repaid within a specific time after the Order is issued. It can also be used to close a business by creditors as proof of insolvency.
- Statutory Demand
This is a written warning to repay a debt or agree alternative arrangements with the creditor. As this is a legal warning, the creditor’s solicitor will issue a statutory warning and this can be a step towards a winding up petition, although it’s not a prerequisite.
- Winding up petition
Creditors may file a winding up petition with the court. This is the most serious action they can take because, if granted, it puts your business into compulsory liquidation.
What actions can you take?
Being in debt does not take the future of your business out of your hands. While creditors have options for what they can do to recover debt, you also have choices about how to manage your debt, with some important positive actions within your power to take:
- Take action, be proactive and don’t ignore your financial difficulties
- Communicate with creditors early on, so they are aware of your difficulties and can help you to find a mutually agreeable solution to repay their debt
- Don’t be afraid to negotiate. Creditors will be keen to retrieve their money, so finding a solution for repayment of monies owed is in their interest too
- Enter into a Company Voluntary Arrangement (CVA) if you have more than one debt and want to structure them into an affordable repayment amount while still continue trading
- Company administration will secure a period of time for an Administrator to create a recovery plan, with a CVA as one possible option
Learn more about your options
The possible actions above illustrate some of the options available to help put off creditors from knocking at your door, but it is important to get expert advice to understand all the implications of each option and find the best solution for your particular situation.
As debt advisors, James Rosa Associates can negotiate with creditors to put manageable repayment plans in place and help you to understand the implications of each option.
Looking after mental health
Importantly, we understand the effect of debt on mental health and wellbeing. We make sure our support is personal, human and non-judgemental so that clients know they aren’t alone and can build the confidence to find a path back to a debt-free future.
James Rosa Associates
James Rosa associates is a firm of specialist debt advisors and debt adjustors. With a supportive and friendly approach, we offer a full range of advice and professional services to individuals and business owners/directors who face unmanageable debt, or who are involved in civil or commercial disputes. Our services include:
We are authorised and regulated by the Financial Conduct Authority (FRN665061) to work with clients to produce bespoke solutions for their specific circumstances.
Find out if you qualify for a free consultation
If you want to deal with an unmanageable debt, or bring a dispute to a swift and cost-effective resolution, contact James Rosa Associates, ring 0845 6807217 or email enquiries@jamesrosa.co.uk to find out whether you qualify for a free consultation.
Weathering the storm: How resilient is your business to financial pressures?
Mr Bankruptcy
20th September 2022
In a previous blog post we spoke about building financial resilience into your business but, as many businesses continue to feel financial pressure in the current economic climate, thinking about new ways to build resilience will help companies to ride out the storm.
How can businesses build resilience?
Business resilience to financial pressures comes from not having one particular strength but rather by building and spreading resilience across a number of facets of a business. A weakness in just one aspect can have a knock-on effect, making your susceptibility to financial pressure very apparent.
To determine how resilient your business is to current and potential financial pressures, consider the following broad areas:
- Commercial resilience: How good are you at retaining clients? How could the current economic climate affect them and what are the implications for your business? How could you generate new clients or diversify to maintain existing streams of revenue and grow new ones?
- Operational resilience: How agile is your business and able to adapt to changing circumstances? Flexibility in how your business operates could make or break a business. Are you able to make cut-backs when necessary? Can your business adapt to changing economic, environmental or regulatory situations to keep it relevant and able to meet client needs?
- Organisational resilience: Do your employees and managers have the knowledge and skills to make decisions that reflect the changing world around them and do they make decisions that demonstrate this understanding? Training and education are important, but employee wellbeing also matters to ensure they too are resilient and that you have a good reputation as an employer to continue attracting talent.
- Environmental resilience: Not only are there physical threats from the environment around us, such as fire or flooding, but businesses increasingly need to be sustainable, taking on a responsibility to minimise their impact on the environment, especially in light of the expectations of customers.
The next step to business resilience
Throughout the past few years up to 2022, businesses have had to continually adapt to new challenges that have tested their resilience in many ways. Continuing to build financial resilience, together with resilience across all aspects of your business is essential to help short-term survival and to establish a base for longer-term success.
Having this awareness helps business owners to spot the signs when their business is getting into difficulty and enables them to act quickly. The ability to address challenging situations depends largely on acknowledging the problem and being prepared to seek specialist advice.
While such a conversation can seem difficult to initiate, it can be an essential part of your toolkit for building greater business resilience.
James Rosa Associates
James Rosa Associates is a firm of debt advisors and debt adjustors. With a supportive and friendly approach, we offer a full range of advice and professional services to individuals and business owners/directors who face financial challenges including unmanageable debt, or who are involved in civil or commercial disputes. Our services include:
We are authorised and regulated by the Financial Conduct Authority (FRN665061) to work with clients to produce bespoke solutions to fit their specific circumstances.
Find out if you qualify for a free consultation
If you want to deal with an unmanageable debt, or bring a dispute to a swift and cost-effective resolution, contact James Rosa Associates, ring 0845 6807217 or email enquiries@jamesrosa.co.uk to find out whether you qualify for a free consultation.