Fear: The Major Barrier Preventing Debt Workouts

We speak to small business owners all over the country and we always evaluate what prevents some from participation in our debt workout program. It works extremely well, protects assets and reduces debt dramatically. Then why not do it? What other available alternatives are as good? None.

So, what prevents a defaulting borrower facing foreclosure and total loss from engaging in a workout strategy? The major obstacle is fear. Fear of the unknown, fear of failure, fear of risk, fear of facing default head-on and trusting our workout strategies.

We understand. We know that a workout goes against everything you have learned throughout your life. It is truly "upside down" thinking and "under water" action to use a few terms frequently heard in the workout world. So, yes, it's unusual to perform the strategies one must engage in a workout, emphasizing the upside down nature of your financial condition and demonstrating how poorly you are doing and how failure is assured. This all goes directly against the grain of a true entrepreneur who can overcome any obstacle, any day.

Not paying and asking for forgiveness is not what any business person wants to do; we would all prefer to pay our bills and our debts. None of you want to implement a debt forgiveness strategy because you feel it is wrong. You are told it is breaking your word and that it is not ethical. However, we believe a workout is the most honorable way to conduct one's self in a defaulting situation. It is not about breaking your word or acting in an unethical manner, it is about dealing with changing conditions that no one anticipated, nor could they have. Rather, it is accepting the responsibility for being "upside down" and doing the best possible thing under the circumstances.

These are difficult times, challenging times, with impossible barriers. Because of declining revenues and choking debt, you must act decisively and this means you should do the debt workout---it is the only way to save your business and your financial future. Yes, it does require trust. It is uncomfortable and it is backward from everything you have ever done or learned, yet, what choice do you have?

Do the debt workout. Save your business and emerge successful and profitable.