When Your Best Option Is To Liquidate Assets To Settle Debts
It is normal for people and businesses to find themselves in unexpected financial crisis which might require them to liquidate assets to pull through. Pulling through can depend on how creative one is. Most importantly though, we usually advise people to engage the services of expert financial advisers if the only option is to liquidate assets.
Basically, assets are stuff we own that can be sold or converted to cash. The best assets are those that can be sold easily especially when the debts have a deadline attached. These assets can include houses, cars, jewelry, and electronics. Even your 401k, bonds, stocks, mortgages, etc. are assets that can be sold off to ease your cash flow problems.
Below are some of the steps to trod before selling off some prized assets to settle your debts
Determine your level of indebtedness
When the debts are personal, determining how much you owe is not such a big deal. You can easily get that information from your credit card or bank statement.
The best advice we give clients is to have them contact their lenders individually and discuss a repayment schedule. This could be tricky and requires one to be very convincing and diplomatic at the same time. Ultimately, the plan is to free up cash while being able to meet your financial obligations on a more flexible schedule.
Taking inventory of assets
As stated earlier, the best assets are those that could easily be liquidated. It goes without saying that the assets that would be disposed of are linked to the scale of the debt.
Hopefully, the size of the debt won’t involve putting your home on the market. Household items like electronics, clothes, and electrical appliances can be sold on online sites such as Craigslist and eBay. A garage sale could also be organized for the neighbors, family and friends.
If art objects are involved, the best option is to use reputable dealers to handle the sale. We believe this is the best option to get fair value for items like that. The fact you are in debt doesn’t mean you have to sell yourself short.
Liquidating business assets
For small business owners shutting down because of debts, the fastest way to settle creditors is to liquidate assets linked to the business. Business assets should not difficult to itemize. At least, businesses have updated records of all transactions in a file somewhere.
Tangible assets to liquidate include furniture, business equipment, supplies, vehicles (if there are any) and artworks. The best practice when itemizing these assets is to describe the condition of the assets for buyers to easily assess what they are purchasing.
Also, small business owners can liquidate intangible assets such as contracts and leases.
Experts in assets liquidation always make it a point to get the best for their clients. Ultimately, even if the debts are not completely wiped off, it would be cut down to a very manageable level. The aim is to get the client back on their feet as quickly as possible without the debt albatross weighing them down.
If you are at a loss on how to swiftly liquidate assets, never hesitate to consult experienced financial consultants. Most of our clients have found that talking to the experts was one of the smartest things they ever did.
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