Is bankruptcy the best option to get rid of the lease? 11 Answers as of May 28, 2015

I own 3 small retail stores, the business is struggling, it is an S corporation with 3 shareholders. I will not survive in the business for too long? What are my options? I have 2 years remaining in a commercial lease, and it will not be easy for the mall to rent out this locations.( I already talked to them). Should I file for bankruptcy before I default on my rent on the lease or after I default on the lease?

Ask a Local Attorney. 100% Anonymous. Free Answers.

Free Case Evaluation by a Local Lawyer: Click here
Stephens Gourley & Bywater | David A. Stephens
A bankruptcy will eliminate the leases. When you file depends on when you want to close your business.
Answer Applies to: Nevada
Replied: 5/28/2015
GARCIA & GONZALES, P.C.
GARCIA & GONZALES, P.C. | Richard N. Gonzales
Pay an experienced BK lawyer for one to two hours of their time. Go in with your financials and copies of the lease. Your case does not lend itself to a quick answer. Sorry, but I have over thirty years experience, and I have successfully filed THOUSANDS of bankruptcies. Now is not the time to skimp. You want to do this right!
Answer Applies to: Colorado
Replied: 5/28/2015
Janet A. Lawson Bankruptcy Attorney
Janet A. Lawson Bankruptcy Attorney | Janet Lawson
Well you never want to have an "unlawful detainer" on your record. It will make renting horribly difficult after that. I would file for bankruptcy first. But with 3 business you need a lawyer. You may find one at nacba.org.
Answer Applies to: California
Replied: 5/28/2015
Ronald K. Nims LLC | Ronald K. Nims
The first issue is whether you're personally liable on the leases or are they simply corporate liabilities. If you're not personally liable there is no need to file personal bankruptcy, although you might want to consider a bankruptcy for the S corporation. If you are personally liable, then file before the rent gets in arrears. That way only the bankruptcy will appear on your creditor. If you let the leases default, then you'll have the bankruptcy and the lease defaults on your credit reports?
Answer Applies to: Ohio
Replied: 5/27/2015
Law Office of Michael Johnson
Law Office of Michael Johnson | Michael Johnson
The timing does not matter. You should consult with an attorney to discuss your options.
Answer Applies to: Florida
Replied: 5/27/2015
    Musilli Brennan Associates PLLC
    Musilli Brennan Associates PLLC | John F Brennan
    Need more details and you need counsel.
    Answer Applies to: Michigan
    Replied: 5/27/2015
    Danville Law Group | Scott Jordan
    It is not clear that bankruptcy is an option. Are you considering personal or corporate bankruptcy? Did you personally guarantee the leases? Are you planning to close down the business? The solution for resolution of your problems will depend on you answers.
    Answer Applies to: California
    Replied: 5/26/2015
    Richard B. Jacobson & Associates, LLC | Richard B. Jacobson
    The first question is whether you are personally liable on the lease, along with the corporation. If you are not, then you need not worry about the landlord collecting from you (although he/she/it/they might try). As to the relationship between defaulting on the lease and the date of filing the bankruptcy, assuming you are personally on the lease, some considerations will be your personal credit score (you enter bankruptcy with a higher score if you have not defaulted on your lease), what you can afford to pay without scanting your family's needs, and other questions which you ought to discuss with an experienced bankruptcy lawyer, who can advise and represent you and save you lots of headaches. Good Luck.
    Answer Applies to: Wisconsin
    Replied: 5/26/2015
    The Orantes Law Firm
    The Orantes Law Firm | Giovanni Orantes
    It would be better to file the bankruptcy case before you default because once you default the landlord will start the eviction process which makes the filing more stressful for everyone concerned. However, you should consult an attorney with experience with business bankruptcy cases as other attorneys may not appreciate the potential dangers of filing a business-entity Chapter 7 case. Remember that entities do not get a discharge of its debts in a Chapter 7 case; so, you need to analyze carefully the pros and cons of filing the case and carefully plan the filing before actually filing it.
    Answer Applies to: California
    Replied: 5/26/2015
    A Fresh Start
    A Fresh Start | Dorothy G Bunce
    Who signed the lease? You as an officer of the business, or you, as a personal guarantor of the business. Cause unless you personally guaranteed, you can turn the keys back into the landlord and let suit proceed against an empty shell. But if you personally guaranteed, the landlord could sue you. Before jumping off the cliff with the landlord, why not sit down and discuss this like a businessman and see if there are things that can be done to minimize the landlord?s loss without sending you into bankruptcy.
    Answer Applies to: Nevada
    Replied: 5/26/2015
    Law Offices of Daniel J Winter
    Law Offices of Daniel J Winter | Daniel J Winter
    You might have options other than bankruptcy. However, you'll need to get together all of your documents: Lease papers, loan documents, taxes, business and personal, credit and other debts, and assets, both personal and business, then call an experienced attorney for an appointment to discuss the best strategy.
    Answer Applies to: Illinois
    Replied: 5/26/2015
Click to View More Answers: