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Business Bankruptcy and credit cards

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borreman

Member
What is the name of your state? NV and NY

My NV business was purchased 2 years ago by a company in NY.
The deal was we would keep using the business card (that has me as personal guarantor) during transition time (6 months), after which the buyer would repay the business expenses on the card, and start operation with his card. Problem is, he never repaid my card and the card is now in charge off for $117k.
The buyer is going to bankrupt my former company, and want to roll this card into the bankruptcy.

It is not my bankruptcy, but my card will be part of his bankruptcy. Will this affect my personal credit in any ways? Any specific ways I should handle this?

Thank you for your input.
 


borreman

Member
Thank you Zigner, but I dont understand your response. If the card is rolled into the bankruptcy, can the card company still go after me? Is that what you are saying?
 

LdiJ

Senior Member
Thank you Zigner, but I dont understand your response. If the card is rolled into the bankruptcy, can the card company still go after me? Is that what you are saying?
You personally guaranteed the card. That means that if the company includes the card in the bankruptcy that you will be on the hook as the personal guarantor. You will then owe the money. The business bankruptcy does not get YOU off the hook, it only gets the business off the hook.
 

borreman

Member
Thank you LdiJ! But if that is the case, then what is the point for the business to roll it into their bankruptcy if the card is in my name anyway? These are business related charges, is there a way for me to fight this?
 

borreman

Member
PayrollHRguy - it has been in litigation for 18 months. We are now coming into a settlement in which the new owner of the company wants to roll the card into his business bankruptcy to get me off the hook. But seems it is not the case...
 

LdiJ

Senior Member
Thank you LdiJ! But if that is the case, then what is the point for the business to roll it into their bankruptcy if the card is in my name anyway? These are business related charges, is there a way for me to fight this?
Honestly no. When you agreed to continue to allow them to use the card, you became their creditor. They are including you in the bankruptcy as their creditor, just like any other creditor. You are stuck with the 117k debt.
 

PayrollHRGuy

Senior Member
Thank you LdiJ! But if that is the case, then what is the point for the business to roll it into their bankruptcy if the card is in my name anyway? These are business related charges, is there a way for me to fight this?

PayrollHRguy - it has been in litigation for 18 months. We are now coming into a settlement in which the new owner of the company wants to roll the card into his business bankruptcy to get me off the hook. But seems it is not the case...

And your lawyer hasn't caught on to this issue? You need a new lawyer.
 

borreman

Member
I have paid $400K in legal fees since the start, between discovery and depositions... I feel I have been way overcharged. Any way to fight this too?
 

FlyingRon

Senior Member
Overcharged by whom? If you think it was the attorney that overcharged you directly (i.e. you were their client), then if they were in Nevada, you file a complaint with the state bar who has a system for fee disputes. In New York, such disputes are handled by the state Attorney General's office.

If the other company passed fees along to you claiming they were legal fees, you're likely screwed. You can sue them for that along with the failure to pay the credit card bills, but if they are in a chapter 7, you're probably pretty low on the pecking order and won't get anything out of it.
 

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