There is a lot left to give when a business closes down. If you have reached a point where you can find no way to look any further and carry on with your business you may find that there are payments to be made to the suppliers, landlords, service providers, utilities, apart from a bank or any private commercial lender. This due amount can large enough to make you search for ways to pay them off. After closure, you may choose to either pay all these bills in full if you have the money or make some settlements to pay less than what is due or file bankruptcy.

Arrange Your Debts

The most important factor while dealing with debt is the prioritization of it. If you have an asset attached to the business as collateral and want to save it, then you must pay that first and then consider the other ones. After that, you must consider paying off any wages or benefits accrued to your employees and for all those loans for which you are liable personally, particularly in the case of court judgments. If you have money left with you, then you can go for your suppliers, lease deficiencies, credit card companies, bills for other random business expenses like advertising, dues and other subscriptions, travel and charges for entertainment, repairs and maintenance and others.

Negotiate on Your Deals

When you are sure that you cannot pay off the amount due to your creditors, you must also be sure of the amount which you can afford to pay. You must also find out how little your creditors will agree to take from you. It all depends on the attitude and the type of the creditor as well as the legal details related to it. If your business is an LLC or a corporation which do not have any personal guarantor, then your creditor will be aware of the fact that they cannot collect the debt from you. It gives a chance that they will agree to settle for less and consider it as your full and final repayment.

Criteria For Settlement

No matter what is the legal status of your business, it is always advisable to go for a settlement if you can pay thirty to seventy percent of the total amount due. As the creditors know that they may lose the entire amount due from you once you are out of business, they may settle for a lesser amount. It is better for them as they will not lose the entire amount. You can even settle for less if you hire a good lawyer to negotiate with your creditors on your behalf. Always try to negotiate for settlement for the larger amounts due as settling for lesser amount will help you save more money than settling small dues.

Potential Future Claims

After settlement if you have any money left for you then keep it aside for any potential claims in the future. You can visit here to know more about the estimation of unpaid bills which might lead to potential lawsuits. You can keep it safe in a regular bank account of your business, savings account or in an escrow account if the amount is significant.