Having to declare bankruptcy is every business owner’s nightmare but sometimes it is unavoidable and the best possible solution. When you do declare bankruptcy, you will find that your capital will be affected, and you might struggle to get this back in the future. However, it is possible to start a new business right after declaring bankruptcy if you know what to do. Here, we are going to talk you through some of the things that you can do to make this process easier. Keep reading to find out more.
Things To Consider
Although starting a new business right after declaring bankruptcy is possible, you need to make sure that you have considered what you are doing carefully before you get started. If you are planning to start a similar business, then you should be aware that any old creditors might be able to collect from your new business if it is similar. If you are creating this business to avoid paying creditors, then you will be committing fraud so consider this carefully when starting your new business.
You should also consider the fact that you might struggle to finance your new business from the get-go. Getting loans and other types of funding might be difficult preventing you from starting your new business right away. Other considerations include the fact that you’ll need to maintain good business records and pay your business taxes.
As long as you are able to get past these obstacles, you should be able to start a new business after declaring bankruptcy. Find out some of the ways to deal with financial problems below.
Choose A Low-Capital Business
If you are struggling to regain your capital after recently declaring bankruptcy, then you might find that you could benefit from choosing a new business that requires little capital. This could include anything from dog walking to convenience services and it might be one of your only options in terms of starting a new business.
Apply for A SBA Loan
Funding can be difficult to get after declaring bankruptcy but the good news is that you can apply for SBA loan which can help you to get back on your feet. The good thing about a small business loan is that you don’t always need to have a lot of capital and this can be the perfect solution for those who have recently declared bankruptcy. You can use this loan for any element of your business so make sure to look into this.
Co-Sign A Loan
Our final tip for those who want to start a new business right after declaring bankruptcy is to find someone with credit to co-sign your loan. This can help you to get a better offer and get your business off to a good start.
Remember that it is possible to start a new business after declaring bankruptcy. Make sure to apply for an SBA loan and consider everything that we have discussed in this article.