The COVID-19 pandemic has affected businesses in ways many economists never thought possible. For business owners, Minnesota’s stay-at-home order has created economic hardship as businesses that were considered non-essential were asked to close their doors. It’s put many restaurants, salons, and other small businesses at risk for failure. For some, a loan modification may be a solution.
Gov. Tim Walz recently is allowing some businesses to reopen with limitations. Most retail businesses will be allowed to open at half capacity under safety guidelines, and employers can return workers to office settings if they take similar precautions. Those who can work from home are still encouraged to do so.
With that, however, Walz extended a previous order to June 1 that bans in-house dining service, bars, barbershops and salons, though Walz said he would ask his cabinet members to develop guidance on how to open those businesses once the order expires. Also remaining closed are theaters, gyms, and other indoor sports facilities that were shut down in mid-March before the stay-at-home order went into effect.
Minnesota Loan Modification Attorney
If your business is struggling, a loan modification may be a solution for you. The problem is, most lenders won’t work with a debtor directly on a loan modification. Asking nicely is futile. Speak to our Edina loan modification attorneys at 952.841.9000 or fill out our confidential contact form. Your first consultation is free.
Loan Modification to Prevent Foreclosure
As businesses struggle to regain an economic foothold, many are looking for ways to help cover the bills that still need to be paid, despite the pandemic. The Minnesota Department of Employment and Economic Development has established a loan program to assist small businesses directly and adversely affected and whose industry is named in Executive Orders 20-04 and 20-08 following the COVID-19 pandemic. Small businesses are a vital part of Minnesota’s economy and this program provides a source of working capital to help businesses sustain operations during this challenging time.
For business owners who can’t afford their current loan payments, getting a loan modification may be the answer to staying out of foreclosure. It is important to remember that eligibility for a modification is determined by the investor’s set of guidelines — and not everyone will qualify. But, timely applying for modification is important and can provide other solutions to foreclosure. The frustration of trying to get your business back-on-track in a time when COVID-19 is still very much on people’s minds can create a stressful situation. If you are a business owner considering loan modification, let the experienced attorneys at MLG Bankruptcy help you. Our real estate law firm represents business owners facing foreclosure and other problems by working with lenders and other creditors to secure loan modifications and other relief for our clients. Give us a call at 952.841.9000 or contact us here to schedule a free consultation via phone or video chat.
Do I Qualify for a Business Loan Modification?
Typically, in order to get a business loan modification, you must:
- provide all required paperwork -this will likely include a financial statement, proof of income, most recent tax returns, bank statements, and a hardship statement to the servicer for evaluation;
- show that you can’t make your current mortgage payment due to a financial hardship; and
- complete a trial period to demonstrate you can afford the new monthly amount.
There are usually several lender guidelines that must also be met, which can often be complicated, but the attorneys at MLG Bankruptcy can help you navigate this process with ease.
Because your actions are important in getting your loan modified, here are some tips to help prepare you for the process:
Apply for a modification as soon as possible. To qualify, you’ll more than likely have to submit what is known as a loss mitigation application to your loan servicer. An application should be submitted as soon as you know you’ll have trouble making your payments or soon after you fall behind. The longer it takes to get the proper paperwork and documentation, the better the likelihood a foreclosure could start or continue, leaving you with less time to work out an alternative.
Send in all items the servicer requests. To get protection under federal and some state laws, you have to send your servicer a complete application. An application is only complete once you’ve sent in everything that the servicer requested, including financial worksheets, bank statements, tax returns, a hardship statement and more. One of the most common reasons that business owners often don’t get approved for a modification is because they fail to send in every document that the servicer requests.
Keep all correspondence you receive from the servicer. This paperwork – digital or hard copy – is essential to you for a variety of reasons. Be sure to retain all communications you receive from the servicer, including a confirmation letter that the servicer received your complete application or a letter telling you that certain items are missing. This information could be useful later if you have to challenge a foreclosure.
Consult with and hire an attorney that is familiar with the laws who can help protect you in the process. Servicers sometimes make mistakes when processing borrowers’ modification applications. An experienced attorney will know the federal and state laws that can protect you in the loss mitigation process and can enforce your rights if the servicer fails to abide by the law. The lawyers at MLG Bankruptcy have the knowledge and experience that is critical in dealing with loan modification applications. Clients come to us to successfully represent them in real estate, bankruptcy, and commercial transactional and litigation matters. We’ve earned a longtime reputation for legal excellence, and our attorneys represent every single case with honesty, conviction, and compassion.
And, most importantly, we value our clients. We appreciate the trust they place in us to represent them. Our attorneys will fight for you until a positive outcome is reached. Let us help you. Call us today: 952.841.9000.
About MLG Bankruptcy
At MLG Bankruptcy, we don’t just counsel our clients. We invest in them.
Our attorneys have been serving the Edina and Twin Cities communities since 1974. Our attorneys provide personalized, cost-effective legal services to clients seeking help in real estate, business development, commercial litigation, bankruptcy, loan modification, debt reorganization, personal injury claims, family law, and other matters.
Our experienced attorneys believe that relationships matter, whether a client is trying to navigate a purchase agreement, get a business off the ground, or dissolve a partnership. Our lawyers appear regularly in state and federal court, in administrative hearings, and in various alternative dispute resolution forums, including mediation and arbitration.
MLG Bankruptcy is a highly skilled Minnesota law firm for all of your debt relief needs. We advocate for our clients with professionalism, vigor, and with a results-driven approach.
Let’s get started today! For more information or to book a free consultation, call 952.841.9000 or fill out our confidential contact form.