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Reposession and Closing Company YES or NO

Reposession and Closing Company YES or NO

Old May 23rd 2008, 1:34 pm
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Default Reposession and Closing Company YES or NO

I wondered if anyone had an opinion on what i should do next. It´s difficult for me because i have no impartial advice to listen to so i thought i´d try out the forum as a very of releasing the pressure a bit.

We operate in rural Spain and have done for nearly three years. s with most companies year one we made a loss year two breakeven and this year projected a decent profit.

We signed contracts late last year with a number of large companies to supply services etc to them and we thought we had spread our risk from individual sales which looked to be slowing down and continuing to do so this year by getting corporate work.

Recognising that we would have a cash short fall during the first 4 months of the year until the contracts came on line we aproached our bank with a business plan and our requiements for the year. We should have been worried when the bank manager said it was the first time he had seen a business plan from anyone!

Anyway we were promised an answer within 2 weeks and as we had a perfect history with them since day one in Spain we happy that things were going according to plan.

Four months after applying the bank manager is gone and we are told that there is no record on the system of a loan application despite going in daily and obviously frantic as the bills and mortgage payments were being missed the manager kept saying come in in a couple of days to sign the paperwork at the notary. Now he´s gone the bank say it´s my word against his and guess what they believe him and are now repossesing the family home.

Also our first big corporate customer having done lot´s of work for did´nt pay his bill in April owing us 154k. The solicitor says it´s an open and shut case but will take up to 2 years to be heard and cost in excess of 10k to fight with no guarantee at the end.

Our other corporate customers have delayed there orders saying the economic downturn has effected their business they are now not wanting anything for at least 9 months.

So obviously the plan has gone to pot and if we survive this year we will if we are incredibly lucky breakeven.

We have trade debts of 40k now plus the mortgage payments and ironicaly the only thing keeping us going is the smal individual orders.We have a strong order book for later in the year but the question now is do we want the hassle and heartache of carrying on or do we just let go and admit defeat.

It´s difficult as all our previous businesses have been very succesful but with very little money coming in and having against my wishes had the company registered to the home address we are getting daily harrassing visits from trade creditors who as we are English think they can throw there weight around and threaten us with violence etc.

We could trade our way out of this if there is a way of coming to agreements with all the creditors and the bank but our accountant is useless and appears to not be able to suggest a way forward. His advice is that i am personally liable for the debts but that´s not how my understanding of an SL company is.The bank have ignored our official complaint and also our offers of payment.

So in the words of the song ´should istay or should i go? OR
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Old May 23rd 2008, 4:42 pm
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Default Re: Reposession and Closing Company YES or NO

Sorry about your predicament. I hope things work out. I dont see any replies, I think it has got us all flummoxed. We like to help each other, but there is rather a lot at stake here, and most of us (myself included) would love to offer the solution, but it is too big for us. I can only offer you and yours all the best, whatever you decide. I presume you have some kind of CASA RURAL. Maybe there is some help for "rural based businesses" as some are classed as "conservation" or have "valor patrimonial" (sorry dont know how to say it in English). If you need any help with writing letters or things of that sort PM me. You will need to post on here first and tell me how to PM. (I have never done it). I cant give advice because I dont have the knowledge, but if you find out about anything that my help you, I will translate your thoughts and compose letters for you. You can then copy them onto paper and print. Perhaps this is spitting in the wind, but you never know.
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Old May 23rd 2008, 5:36 pm
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Default Re: Reposession and Closing Company YES or NO

Originally Posted by me me
Sorry about your predicament. I hope things work out. I dont see any replies, I think it has got us all flummoxed. We like to help each other, but there is rather a lot at stake here, and most of us (myself included) would love to offer the solution, but it is too big for us. I can only offer you and yours all the best, whatever you decide. I presume you have some kind of CASA RURAL. Maybe there is some help for "rural based businesses" as some are classed as "conservation" or have "valor patrimonial" (sorry dont know how to say it in English). If you need any help with writing letters or things of that sort PM me. You will need to post on here first and tell me how to PM. (I have never done it). I cant give advice because I dont have the knowledge, but if you find out about anything that my help you, I will translate your thoughts and compose letters for you. You can then copy them onto paper and print. Perhaps this is spitting in the wind, but you never know.
What a terrible situation to be in, Sorry

Firstly I would get another accountant on board and get their advice, they may also be able to put some pressure onto the bank to come to some sort of comparmise and work from there.

Try and take everything a stage at a time and for heavens sake if you get any sort threats/hassle then immediately call the police at least then the creditors will get the message that you will not be hassled and more inclined to reach an agreement for repayment.
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Old May 23rd 2008, 5:53 pm
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Default Re: Reposession and Closing Company YES or NO

One of the benefits of an SL company is that only the assets of the company are liable. It is not possible to execute debt against the personal capital of the shareholders.
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Old May 23rd 2008, 6:58 pm
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Default Re: Reposession and Closing Company YES or NO

Sorry to hear about your situation, I have been in a similar place myself and when you think your house is on the line it can be terrifying.

First off I think you need to raise enough cash to secure proper representation, (as I'm sure that most professions wouldn't take on a case unless they were sure they were going to be paid) so that you can at least put yourself in the best informed position to assess your options. A good solicitor and accountant are absolutely essential in any business.

I would say remain positive, if as you say you could trade yourself into a breakeven position this year even with these setbacks then you are in very good shape. To lose it all now would be awful. If you enjoy what you do and wouldn't give it up if it wasn't for this mess then I would fight tooth and nail to keep going.
I would have thought that in the current financial crisis the last thing the banks would want to do would be to foreclose on you. They get a bigger headache and no guarantee that they will recover their capital.
Saying that, there is every chance that they will decline a loan application.

If you are owed 154k by a corporate and can still trade through then I can't see how you are in a bad position, granted it may take 2 years to get at it but with interest and costs awarded this is money in the bank.

If there is no way for you to raise working capital in the short term then I think the last resort to keep going is to sell part of your company to an investor, possibly with a buyback clause to regain full ownership. You even already have a business plan! However given the risks involved any white knight is going to want a pound of flesh in return.

Also I was under the impression that an SL was pretty much the same as a Ltd in the UK so unless you have secured finance on your home, they can't touch it. If the mortgage payments you are missing are for your home rather than business premises then you need to get your other half working or dare I say it do the odd foreigner to make ends meet.

It's hard to assess properly without knowing more details but if you want something bad enough I believe there is always a way. Stay calm and positive and try to be rational.

I wish you all the best and just hope I've been of some help, even if it is just moral support

Ste.
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Old May 23rd 2008, 7:17 pm
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Default Re: Reposession and Closing Company YES or NO

With regards the 154K you are owed at the moment to could do worse than employ a company shown Best of luck. Remember this company works its fees on a no win no pay basis.

http://www.incassopartnersnederland....llection_Spain


Most invoices have either due on receipt or net 30 on them. In our case, if it's someone we know or an established client we go net 30....meaning 30 days to pay.

Normally everyone sits down near the end of the month and writes all their checks off of the statements they have so if for example you have a service rendered on January 12 and I send and invoice, then send a statement at the end of that month, I expect to be paid no later than the end of February.

What I'm saying is that we usually put net 30 but it ends up being net 45 and that's okay. Once you hit 60 days without payment, it's my procedure to incur the financial service charge.

At 90 days I make it clear that either a payment is to be "received" within 5 business days or that service will be terminated and the amount owing will be sent to a collection agency.

Last edited by poshnbucks; May 23rd 2008 at 7:33 pm.
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Old May 24th 2008, 8:57 am
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Default Re: Reposession and Closing Company YES or NO

Originally Posted by me me
Sorry about your predicament. I hope things work out. I dont see any replies, I think it has got us all flummoxed. We like to help each other, but there is rather a lot at stake here, and most of us (myself included) would love to offer the solution, but it is too big for us. I can only offer you and yours all the best, whatever you decide. I presume you have some kind of CASA RURAL. Maybe there is some help for "rural based businesses" as some are classed as "conservation" or have "valor patrimonial" (sorry dont know how to say it in English). If you need any help with writing letters or things of that sort PM me. You will need to post on here first and tell me how to PM. (I have never done it). I cant give advice because I dont have the knowledge, but if you find out about anything that my help you, I will translate your thoughts and compose letters for you. You can then copy them onto paper and print. Perhaps this is spitting in the wind, but you never know.

We doubt that the OP's business is a Casa Rural as one you'd never get several corporate businesses working with you at once and two the amount owed by just one establishment is more turn over than most Casas in one year.
We cant understand why the OP waited and waited for the money. Plus if you have made your complaint in the form of a hojas de reclamciones the bank must not ignore the complaint. They can be fined for that too.
It sounds as if you have taken legal advice and that is really the route you must take or maybe Fred will be along and give you some help. He is spot on with his legal knowledge.
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Old May 24th 2008, 1:27 pm
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Default Re: Reposession and Closing Company YES or NO

Originally Posted by Casa Santo Estevo
We doubt that the OP's business is a Casa Rural as one you'd never get several corporate businesses working with you at once and two the amount owed by just one establishment is more turn over than most Casas in one year.
We cant understand why the OP waited and waited for the money. Plus if you have made your complaint in the form of a hojas de reclamciones the bank must not ignore the complaint. They can be fined for that too.
It sounds as if you have taken legal advice and that is really the route you must take or maybe Fred will be along and give you some help. He is spot on with his legal knowledge.
I just had a guess as to the activity of the business, I thought maybe they had conferences there or something, but now looking at the figures, I think you are right, it would have to be "some casa rural".
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