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business

Small Business Owners May Be at Risk of Being Personally Liable

Small Business Owners May Be at Risk of Being Personally Liable

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Business Ownership comes with great satisfaction, but it may also come with great liability! Are you protected?

Forming a business entity (corporation, llc, partnership, etc) is only the very first step of many more to take in protecting you. After you form your business entity, you are not just a business owner, you have to act like one.

Are you keeping up with your meeting minutes, resolutions and other business records? Do you know what your governing documents are? If you don’t know what any of these items are, then more than likely, you are not observing corporate formalities.

What are corporate formalities? That’s what’s going to keep you out of trouble. Failing to act like a business, may get you into trouble and open the door for creditors to pierce the corporate veil. And what happens when someone pierces the corporate veil? You really don’t want to know.

Corporate formalities are important for a small business organization as they can protect business owners as well as their organizations. Small organizations should continuously observe their corporate formalities in order to compete in competitive market. To save your company, and yourself, from liability, you need to hire an attorney to help you keep up with corporate governance.

Text or call with any questions to start your free consultation now. 305-467-8532

Categories
REAL ESTATE

HELP! How Much Should I Offer Above Asking Price?

HELP! How Much Should I Offer Above Asking Price?

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It is a crazy time to be buying or selling your home…but is crazy always bad? Well, it depends. Are you buying or selling? Are you a cash buyer or are you getting a loan? Are you offering above asking price or are you low balling it?

In the last month, I keep getting asked the same question from buyers “how much should I offer above asking price?” Similarly, my clients who are selling their homes are telling me they are struggling to choose a buyer because they are receiving multiple offers. Although it would seem like a wonderful problem to have too many buyers, it may backfire. Here’s how.

OFFERS ABOVE ASKING PRICE AND APPRAISALS

You found the perfect home, you want it, and you know there’s other sharks in the pond smelling this perfect little property but you beat them to the punch and make an offer (above asking price), and BAM your offer was accepted by the seller. All the stars aligned and you are on your way to a happy ending, as soon as your loan gets approved. Oh, but then the appraisal comes in and the property appraised lower than the offer you made. Now what?

Solution #1: You have the cash, or your family has the cash, and you are happy to bridge the gap between the loan and the purchase price. Since the appraisal is lower than the purchase price, then your lender will request for you to make an even bigger down payment so the lender is protected.

Solution #2: Short term seller financing: You can get creative and fingers crossed your seller has an open mind. If the gap is not great and you only need a few thousand dollars to close, then perhaps the seller is willing to extend you a short-term loan in exchange for a junior lien on the property. I can help you with the paperwork.

Solution #3: Talk to the seller and ask to lower the price. I know that sounds crazy during this market. However, remember that the seller already invested at least 30 days with you and took the property off the market. And believe it or not, some of us would prefer to avoid the roller coaster, and the paperwork, and just get it over with. Again, it may not work, but it is worth the try.

SO, HOW MUCH SHOULD I OFFER ABOVE ASKING PRICE

Well, that depends on your situation, the appraisal, etc. Ask the seller if an appraisal was obtained recently and ask for a copy. That way you know exactly what you are getting yourself into. If you are a cash buyer, then the sky is the limit, or your savings account balance. You are not constrained by a loan and can offer whatever you want to pay for the property.

However, if you are seeking a loan, then make sure you can make the down payment to make up for a lower appraised value. Your lender will want to have a cushion in case things go south. If you have the extra funds to make an even bigger down payment, then that will determine how much you should offer above asking price.

Now, with that being said, do you really want to get into a bidding war and purchase a property with a lower appraised value than what you are paying for? I don’t know the answer to that. Only you can answer.

By the same token, it is very frustrating for a seller to spend more than a month working with a buyer only to find out the buyer was unable to obtain financing. So, the same word of caution goes to the sellers. Getting offers above asking price is wonderful, but make sure the buyer will be able to close if the appraisal comes back at a lower amount than the purchase price and the lender requires a greater down payment from the buyer.

If you have any questions about buying or selling your home, let me know.

305-467-8532 CONSULTATION IS ALWAYS FREE.

I will review all contracts and make sure they reflect your best interest.

Categories
BANKRUPTCY

Top 10 Bankruptcy Questions and Answers

Top 10 Bankruptcy Questions and Answers

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There are many things to consider before deciding filing for bankruptcy. You and your attorney should discuss exactly what your goal is so that your bankruptcy attorney can find the best legal option for you. However, there are 10 questions that recurring when considering whether bankruptcy is the path you should take.

#1 – Do I qualify for a bankruptcy?

This is a loaded question and it deserves a full analysis by your attorney. First and foremost, your bankruptcy attorney should ask what your ultimate goal is. Depending on what your needs are, the proper bankruptcy chapter should be discussed.

Chapter 7 – Your income should be discussed with your attorney to determine whether you “fit” in a Chapter 7. Perhaps your income is too high and a Chapter 13 should be discussed. You, as the client, should be completely open with your attorney in disclosing all of your assets and income. Another important information that needs to be discussed is the type of debts you owe.

Chapter 13 – Your income is just as important as the total amount of debt you owe. Limits change and your attorney needs to discuss the limits with you; however, the amount of unsecured debts you can include in a Chapter 13 bankruptcy is approximately $395,000 and approximately $1.2 million in secured debts.

#2 – Can I discharge child support or alimony debts in a bankruptcy?

Simply put: “No.” Child support or alimony unpaid amounts cannot be discharged in a bankruptcy.

#3 – Will my car and house be taken away if I file for bankruptcy?

No…unless you want to. If you want to keep your car and home and make payments, then you can always do that, given that you can in fact make the monthly payments. However, you need to discuss your goal with your attorney and your attorney should be able to find solutions for you. However, if you don’t want to keep your house or car, you can also do that.

#4 – How can I afford to pay a bankruptcy attorney if I’m filing for bankruptcy?

This is a very good question. However, please know that our firm is willing to work with you and we offer a payment plan. The last thing we want is add yet even more stress to your life with a heavy attorney invoice. We can always find a solution that works for both of us. Call us to ask about our payment plans! 305-467-8532.

#5 – How will my credit score be affected by my bankruptcy?

If you are considering to file for bankruptcy, chances are your credit is already damaged. Most people filing for a bankruptcy have already missed either house, credit card, or car payments and their credit score has already been damaged. Filing for bankruptcy will definitely affect your credit score in the short run; however, in the long run it can increase your credit score. It is up to you to build your credit after a bankruptcy and we can guide you on how to do that after filing your bankruptcy with us.

#6- Can I qualify for a mortgage or auto loan after a bankruptcy?

Absolutely! Lenders take into account many factors, including credit score. Although you may have to pay a premium or a bigger down payment in order to obtain credit, obtaining a mortgage after a bankruptcy is not off the table. Also, remember that every lender has different requirements. Perhaps a local lender has more relaxed guidelines, as opposed to the bigger financial institutions.

#7 – How long does a bankruptcy last?

Chapter 7 – Typically 3-5 months.

Chapter 13 – Typically 3-5 years.

#8 – Can I continue using/paying one of my credit cards after I file for bankruptcy?

No. You cannot give preferential treatment to a creditor and treat other creditors in the same category differently.

#9-Does my spouse have to be included in my bankruptcy?

No. Your spouse does not have to be included in your bankruptcy. However, many times, it would be beneficial for both spouses to be included in a single bankruptcy case. There are also other things that need to be taken into consideration, including the non-filing spouse’s income.

#10 – If I file for bankruptcy, will my children be taken away?

No. You cannot lose your parental rights in the state of Florida simply by filing for bankruptcy. Stripping someone of parental rights is a long and complicated process and only a judge may do this. Simply filing for bankruptcy has nothing to do with what kind of parent you are to your children.

Call or text us for a free consultation 305-467-8532

Categories
BANKRUPTCY

Student Loans. The Next Big Bubble?

Student Loans. The Next Big Bubble?

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Like a bubbles, sooner or later, it will burst. The dark reality is that a lot of young professionals are defaulting on their students loans or struggling to repay them.

Can Student Loans Be Discharged in Bankruptcy?

The typical legal answer is “It Depends.” Although typically student loans cannot be discharged in a bankruptcy, there are specific circumstances when they can indeed be discharged. If the borrower can prove extenuating circumstances which are likely to continue for the life of the loan and the borrower has made good faith efforts to repay the loan, the loans can be discharged.

So What’s “Undue Hardship?”

The “undue hardship” test set in the Brunner test is a pretty high standard to meet. Basically, it means that it’s extremely difficult to meet, but not impossible. If you believe you may meet this standard then it is important you seek professional help to help you determine whether in fact you could benefit.

Getting Creative

With the Brunner test being extremely hard to meet, attorneys need to revisit the bankruptcy code and get creative when dealing with student loans. Some of the things to take into consideration are whether the loan is federal or private, and whether the “student loan” was truly used for school-related expenses or to pay the rent and groceries while attending school. There are various ways to navigate the intricacies of student loan debt and only a knowledgeable bankruptcy attorney can help you decide what’s the best option for each case.

Text or call with any questions to start your free consultation now. 305-467-8532