A Chapter 11 Bankruptcy is a last source for a business owner to reorganize business debt. Perhaps it was a non performing business partner, embezzlement or a nonperforming CFO, which led to your Chapter 11 petition. Creditors can also file an involuntary bankruptcy to force a business not meeting its obligations into court, such as a commercial real estate loan default. The less creditors you have listed under your Chapter 11 petition, the less challenging it will be for your business to qualify for new commercial real estate lending.
For example: Your company defaulted with commercial lender ABC who has securitized their interest on your real property, and is the only lender your company defaulted with and is listed under your Chapter 11 petition.
If you petitioned for a Chapter 11, exit strategies are available before and after your Chapter 11 discharge.
- Debtor in Possession specialty financing is available for most non owner user commercial properties. If your commercial real estate property is owner user and that is securitized by your commercial property, lending options may still be available, which will require evidence that your business is still profitable.
- If your Chapter 11 is discharged, commercial financing is available immediately after your discharge.
- Interest rates start at A minus paper
What about My Personal Credit?
The key to succeed in securitizing a commercial real estate loan after a Chapter 11 is maintaining your personal credit while your business is processing a Chapter 11. Your current home mortgage is a basic marker for securitizing your alternative commercial lending, a mortgage payment history with no late payments during a Chapter 11 is vital.
What about My Business Credit Score?
Your business credit report will be impacted by the Chapter 11, this information is of public record and will stay on your business credit report for quite some time. A business credit report is not often used while securitizing an alternative commercial real estate loan. A copy of the bankruptcy discharge and list of debtors of your Chapter 11 is necessary to apply for your new commercial real estate loan.
For more information on how we can locally help you with your Debtor in Possession loan in Florida please fill out the online contact form about your concerns or give us a call at 855.477.9007. Read what our valued clients have to say about First Pro Capital and Credit Consulting Experts on our Testimonials page.