The pandemic is keeping more businesses’ doors closed and putting a halt on cash flow everywhere. This is especially detrimental to the businesses that were already in debt to begin with. Now more than ever, businesses struggling with high-cost debt payments are in need of debt restructuring. Not only can debt restructuring lower payments, but it can also keep companies from going bankrupt and help them improve their cash flow even during the pandemic. For businesses considering debt restructuring, these tips can be a great help:

Know the Debts to Restructure 

More often than not, multiple debts are draining your business. The first step you need to take before going through the debt restructuring process is to determine which debt you want to restructure. It can be possible to restructure one debt while consolidating multiple debts. To figure out the best approach, consult with a debt restructuring expert. They will have the skill and expertise to analyze your debt situation and determine which debts you should restructure.

Keep a Budget in Mind

To successfully restructure your debt, it’s imperative to know how much your company is willing to pay.  Amid a pandemic, business is not what it used to be. It’s important to keep in mind that your budget has likely changed. During these times of uncertainty, you and your business could potentially only be able to afford a fraction of the original debt installment. It’s a very good idea to know how much you can afford to realistically pay, before you approach a debt restructuring partner.  Successfully sticking to this new budget will keep your business operating as normal while also having enough to pay off debts and bring in cash flow.  Many times, this strategy can be completed without any effects to the owner’s business or personal credit scores.  

Show How the Pandemic Has Hurt Business

When approaching a firm to help you restructure your debt, you may need to show or prove to them, on your behalf, of how much the pandemic has affected your business. This will strengthen your position with your creditor(s) and likely result in a better negotiated result for you.  In uncertain times like these, creditors may be more likely to restructure debt when a struggling business is the unfortunate result of the pandemic. If needed, you may need to take the time to write up an open and honest hardship letter that explains the financial obstacles Covid-19 has put your business through and that restructuring your debt can save your business. You may also have to give the creditors concrete evidence and figures that prove how the pandemic has affected your business.  In the end, the reduced payments will likely be around 40% to 60% below what one should be repaying now, so any effort here will be well worth it. 

Use All Government Support Programs

Also, take advantage of all available government programs to help small businesses.  For instance, the SBA has this EMERGENCY LOAN available now, offered for a limited time, that every business owner needs to check out (

Loan Benefits

  • Loan Up To $150,000 
  • 30 Year Term – 3.75% Interest
  • No Payments for 1 year

Minimum Requirement

  • 2019 Annual Sales Of $250,000+ reduced to ONLY $80,000 (change is so new pls ignore website @$250k)
  • 650+ Owner’s FICO Score Preferred (sometimes approved as low as 601)