Prioritizing Business Debt Payments

Emerge180 Offers Help with Prioritizing Payments

Sep 04, 2013, 08:22 ET from Emerge180

TAMPA, Fla., Sept. 4, 2013 /PRNewswire-iReach/ -- Every day hundreds of business owners face the bleak prospect of mounting commercial debts that threaten to close their businesses. In this financial environment Emerge180 stands as an effective partner to help structure negotiated settlements and changes that lead to re-establishing a solid business.


When the economy dropped, it created a domino effect causing many companies to suffer as their markets dwindled, sales plummeted and their suppliers applied pressure to get overdue money.

If a corporation falls into the pit of paying the creditor who is "screaming the loudest", it often fails to attack the most critical financial problem. Utilizing cash flow in the most effective place, not necessarily with the most demanding creditor, enables the organization to recover.

Stages of Debt

Several factors enable business owners to prioritize commercial repayments. Two are the stages of debt and the importance to the debtor. These connect and provide important information used to analyze and create a plan to alleviate the burden of financial obligations.

Determine where each of the debts falls in the continuum of four stages. Is it past due with the original creditor trying to collect? Has it been turned over to a collection agency?  Has a lawsuit been filed? And finally, has the creditor been awarded a judgment?  If so, this grants the creditor authority to issue garnishments and seize assets.

Higher priority should be given to debts longest overdue, because the potential damage from a judgment is far greater than a persistent call on a 90-day overdue invoice.

Determining the importance of debts

A second factor is the importance to the business of the overdue payment. Is this a vital supplier that cannot be replaced? The range of the importance of these factors falls in three categories. Critical business relationships leave no alternative, such as utilities. Semi-critical businesses are those you'd like to stay with, but aren't really essential. Carefully differentiate between critical and semi-critical. Can you work with another company? Finally, non-critical businesses, such as ads in the yellow pages can be classified non-essential.

When reviewing which debts to pay first it is important to consider both factors in unison.  A judgment with a non-essential creditor may be more important than a critical supplier that is past due.  Through this process you will identify which creditors to pay first and which ones can wait.  Now that you have a plan, you can systematically address your creditors with greater success.

About Emerge 180

Emerge180, a national firm based in Tampa, Florida, has been helping businesses avoid financial disaster since 1993. As experts in creditor negotiations and tax resolution services, Emerge180 helps businesses work through financial crises, and creates plans that re-position their clients for success. An A+ Accredited Business with the BBB, Emerge180 has facilitated the financial turnaround of thousands of companies…and, in so doing, the preservation of tens of thousands of jobs.

Media Contact: Media Relations, Emerge180, 1-800-805-1138,

News distributed by PR Newswire iReach:

SOURCE Emerge180