Business Loan debt, help.

Tixy

He wants to offer a part settlement, which will be financed by my ex-partners parents.

If the Limited company is insolvent why would he want to offer any personal money towards this loan ?

He is not responsible for the debts of the limited company. It would be far cheaper to wind up the company.

LaRouge

Sorry, i'm not being very clear, new to this...Its not a limited company, it was a partnership, he sold his half of the partnership.

He wants to try and pay something, he feels awful about the situation.

Tixy wrote: »

If the Limited company is insolvent why would he want to offer any personal money towards this loan ?

He is not responsible for the debts of the limited company. It would be far cheaper to wind up the company.

Tixy

Ah so he is personally responsible for the debt. That explains why there was no personal guarantee.

They may accept a reduced settlement although given the size of the debt they'll also consider the rest of his personal situation (e.g. what personal assets he has, whether he has personal property to try to secure the debt against etc).

LaRouge

Ahh, ok that makes sense, he hasn't got anything they could claim on.

It's a pretty sad situation, i'm afraid.

Tixy wrote: »

Ah so he is personally responsible for the debt. That explains why there was no personal guarantee.

They may accept a reduced settlement although given the size of the debt they'll also consider the rest of his personal situation (e.g. what personal assets he has, whether he has personal property to try to secure the debt against etc).

Tixy

If they are making a settlement offer then it is best if it is made clear that the money is coming from relatives and would be paid by them and is only available if it is accepted in full & final.

Although that said might it be worth him considering bankruptcy? has he spoken to any debt advice charities at all?

LaRouge

Hi, yes he did initially, before the business was sold. He tried working a while longer to pay his debts, but has become ill. He is trying to avoid going bankrupt.

He has gone back home to Italy, to recover himself, and hopes to come back in a few months, once he feels better.

He is due to retire in 3 years, so it's important to him, that he sorts this out. And wants to make a settlement, his parents have offered him 50k, just under a 1/3 of the outstanding amount.

Tixy wrote: »

If they are making a settlement offer then it is best if it is made clear that the money is coming from relatives and would be paid by them and is only available if it is accepted in full & final.

Although that said might it be worth him considering bankruptcy? has he spoken to any debt advice charities at all?

System

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BrassicWoman

I would take advice on bankruptcy. He does need to think of protecting his pension. Bankruptcy now may be a way to help with that.