Our leaders of both parties now seem free to utter things completely at odds with reality and logic.
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Public Companies Provide New Disclosures to Investors
When firms provide their yearly records, financiers in the country’s openly traded business currently have accessibility to an unmatched degree of business details. For the very first time ever before, these records consist of information concerning a firm’s interior control over monetary coverage.
When a firm determines its interior control over economic coverage, it checks the essential procedures associated with videotaping deals and also preparing economic records. A business currently should reveal its analysis of the performance of its interior control over economic coverage, consisting of a specific declaration regarding whether that control works and also whether administration has actually determined any kind of “product weak point.”
These brand-new disclosures were established by the federal government complying with company failings and also company detractions that started with Enron in 2001. Due to the fact that efficient inner control over monetary coverage aids enhance the integrity of monetary records as well as can be a deterrent to company fraudulence, the disclosures are vital to financiers.
Product weak point in inner control over economic coverage does not indicate that a product economic misstatement has actually happened or will certainly happen, yet that it might happen. It is a caution flag.
It needs to be reviewed in the context of the business’s particular circumstance, consisting of factor to consider of the complying with locations.
* Fraud: Does the weak point entail company scams by elderly monitoring?
* Duration: Was the weak point the outcome of a short-lived malfunction or an extra systemic issue?
* Pervasiveness: Does the weak point associate with issues that may have a prevalent result on monetary coverage?
* Relevance: Is the weak point pertaining to a procedure that is crucial to the firm?
* Investigation: Is the weak point pertaining to a present governing examination or legal action?
* History: Does the firm have a background of restatements?
* Management response: How has administration responded to the product weak point?
* Tone on top: Does the weak point stand for a worry about the “tone on top”? – NU
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In a report issued Sunday, the WHO gave a breakdown of the monkeypox virus’ side effects, transmissibility and its presence in countries worldwide.
Guests: Matt Finn, Miranda Devine, Candace Owens, Jason Rantz, Stephen Miller, Eva Vlaardingerbroek, Jonathan Pelson
Seeking the best sources of funding for your business can feel complex and overwhelming. Most young entrepreneurs today feel like bootstrapping their business feels safer and perfect for their needs.
Unfortunately, most start-up businesses cannot thrive without adequate funding. Since few businesses start with a generous budget, you must seek alternative sources. Loans, sponsorships, partnerships, angel funding, co-investors, and grants are some of the options known to many.
Most of these options require collateral of some sort. Collateral is an asset that you can use to secure a personal or a business loan. In layman’s speak, it’s a promise that you can still cover your loan when you cannot make the payments.
Collaterals can be seized and resold to cover the remainder of the loan. For business loans, assets like business equipment, vehicles, buildings, and inventory can be used as business loan collateral. You can even use accounts receivables to pay off the loan if necessary.
Like any other lenders, banks put a lien on the asset pledged as collateral for the loan. If the borrower falls on hard times and cannot keep up with the payments, the lender has the right to seize the collateral. It is a guarantee that the lender still gets paid no matter what. By pledging collateral, a business owner shows that they are not a high-risk borrower. It leads to reduced interest rates and a more reasonably affordable loan plan.
Today, most business loans and credit lines do not come from conventional banks. There are alternative lenders and investors like Credit Suite who can help you with the steps needed to secure a business loan.
We have a wide array of legitimate funding solutions, each with its own different and unique terms that can match your credit profile. Credit Suite’s business loan programs manage the rates and requirements to help increase your chance of getting approved.
High-value collateral often gets matched with a higher loan value which can be beneficial for the lender. It is logical for business owners to choose a loan option that reflects their capacity to pay. However, not many are aware that they can use less popular options as business loan collateral instead of their properties.
The good news? If you own a public stock, you may use that as collateral to secure a business loan. This article explores how public stocks can be your collateral and what makes them such a good option.
Public stocks are liquid assets which makes them an acceptable form of collateral. Everyone in the industry knows that these stocks have passed compliance standards. Hence they guarantee against the unlikely event of a default. It is natural for any individual to feel a degree of protectionism on what they hold dear. It includes real estate, properties they own like vehicles or artwork, and it extends to stocks. However, in the unfortunate event of a seizure, public stocks affect you differently.
You can still operate your business, protect your image, and operate as usual. Treat your public stocks as one of the assets that can help your business continuity process. It is a lifeline that can save you when you cannot make payments without sacrificing the assets that help your business move (i.e., laptop, vehicles, house, etc.).
Overall, what matters is that you are protected from your liability against future payments—the benefit trumps, especially when the need for funding is huge. Most people are unaware that you can use public stocks as such and so the next section will guide you on how to use them so that you can feel more confident in deciding that this is the best option for you to take.
Demolish your funding problems with 27 killer ways to get cash for your business.
Lenders will assess your company’s history, business credit, balance sheet, and equity contributions. When you pass the audit, that’s the time when you submit your collateral for review.
Defaulting on a loan has dire consequences for your business and personal life. It would help if you took a realistic stance when you track your assets. Specifically, your public stocks require an exhaustive review. Consider asking for professional help to help you see how your stocks fare.
Feel more confident in your investment decisions by staying up to date on research-based information, current trends, and market analysis. When it comes to your business and money, a serious reputation is important. You can rely on professional advice from experts like Charlie Shrem, Matt McCall, David Stein, and Josh Bannerman to navigate key investing issues.
A good credit rating increases your loan approval. Using public stocks as collateral, how your stocks perform, your investment history, and your level of stock ownership can all influence your loan-to-value ratio. Look for wiggle rooms in terms of restructuring, repayment, frequency, and scheduling. These are basic areas you can cover in negotiating.
Public stocks can help you get lower interest rates because the collateral is being held. It is because of the reduced risk associated with public stocks. This reduction makes lenders more comfortable because there is little chance of default. Depending on your stock’s value and performance, lower interest rates may be warranted. It does not hurt to ask for an interest reconsideration.
Demolish your funding problems with 27 killer ways to get cash for your business.
This country is built on its fair and reasonable business practices. It extends to flexible loan repayment options. Additionally, it is beneficial to both parties as this essentially guarantees loan payment and profit based on interest.
There are common repayment flexibility schemes in the market to minimize the chances of default. These are accelerated repayment which leads to loan recalculation, step-up loans where the value matches a borrower’s growth potential, and balloon repayment scheme where the loan amount is paid in the last installment.
High-performing stocks can be your leverage for greater repayment flexibility. In the event of trouble making payments, you may adjust the rates or payments depending on your lender’s programs and assistance.
Sometimes, conventional banks are not the right fit for your business. Other start-ups claim that alternative lenders can offer funding that aligns with their goals, structure, and profitability. At Credit Suite, our contemporarily diverse strategies can help your business secure the funding you need. Our client’s testimonials prove how effective we are in our role.
Demolish your funding problems with 27 killer ways to get cash for your business.
There are no personal guarantees when you use public stocks as collateral. How your public stocks perform on the market will vary for sure. If the borrower defaults, the lender can seize and sell the business loan collateral. However, if the collateral sells for less than the debt value, the lender cannot seek that deficiency balance from the borrower.
Therefore, public stock collateral is considered as nonrecourse debt. Due to the risks, lenders generally allow only 50% to 60% loan-to-value ratios. Typically, lenders underwrite these collaterals with more care compared to full recourse loans.
Depending on the kind of loan and the value you are applying for, public stocks as collateral are primarily attractive only when you own significant ownership in the company’s stock. Owning penny stocks or junk bonds will only matter if the value is high, but until it does, you have a better chance of securing your business loans with stocks that have high market value.
When we talk of public stocks, the image and quality of the company also matter. It communicates stability which helps secure the loan. The lender communicates with a broker who tracks the daily value of the stocks.
Should the value decrease, the lender may require more money (or additional collateral). Before you decide to submit your stock portfolio as business loan collateral, ask yourself whether this is a risk you are willing to take.
Remember when Apple stocks went down? Everybody seems to know when this happened, and for good reasons. All eyes watch when the big players lose. When we talk about stocks used as collateral, only significant stocks are considered. At the most basic, this can mean market value, the number of stocks, and degree of ownership.
When your stock’s market value drops, your collateral’s value might go down as well. Though this does not immediately mean that you need to submit more collateral, there’s a line drawn to secure your lender’s threshold. If the market drops far enough, there is a risk that you may owe more than the original amount.
Most business owners who want to push forward understand these risks. Your chances of completing loan payments are significantly increased when coupled with confidence in their product or service, along with sensible market research.
Out-of-the-box thinking pays off in business. Look for additional income streams that you can integrate into your business. At Credit Suite, our Partner Program offers you a unique way to boost your sales and exceed your targets.
Whatever kind of service or product you sell, you can point your customers to our program to complete the sale. We also provide you with all the training and information you need when you become our partner. It’s a win-win situation for the both of us.
Janine Ikan is a teacher, mental health advocate, and freelance writer for The Stock Dork. She has written on psychology, digital marketing, sustainability, and new age spirituality. Her passions include arts, culture, travel, food, social sciences, and community development. She lives in the Philippines with her husband, their energetic toddler, and six cats.
The post How to Use Public Stocks as Business Loan Collateral – and Why You Want to appeared first on Credit Suite.
A derogatory account on credit report doesn’t have to sink your chances for getting business funding. But let’s start with fundability.
Fundability is the ability of a business to get funding. This is everything from getting credit to business loans. Because every business needs money, it quite literally pays to enhance your fundability whenever and wherever you can.
In addition to how well your business pays its bills, and your personal credit score, and whether your industry is a risky one, there’s the matter of public records.
Public records include bankruptcy (both personal and business), liens, judgments, and UCC Filings.
Errors in any of these kinds of public records will affect fundability, so correcting such mistakes will enhance your ability to get funding.
Bankruptcy is a process a business goes through in federal court. The idea to help a business eliminate or repay its debt under the guidance and protection of the bankruptcy court. Business bankruptcies are often described as liquidations or reorganizations. This depends on the type of bankruptcy an entrepreneur takes.
There are three main kinds of business bankruptcy:Chapter 7, Chapter 11, and Chapter 13. The type to use will depend on organizational structure. See thebalancesmb.com/what-is-business-bankruptcy-393017.
Corporations are legal business entities separate from their owners. They are more truly separate than partnerships. But in the event of a bankruptcy, either type of structure commonly will file of Chapter 7 (bankruptcy protection), or Chapter 11 (reorganization). The chapters refer to the US Bankruptcy Code.
This one may be the best choice when the business has no viable future. It is typically used when the debts of the business are so overwhelming that restructuring them is not feasible. Chapter 7 bankruptcy can be used for sole proprietorships, partnerships, or corporations. It is also appropriate when the business does not have any substantial assets. For Chapter 7, see: law.cornell.edu/uscode/text/11/chapter-7.
If a business is a sole proprietorship, and an extension of an owner’s skills, it often does not pay to reorganize it. Hence Chapter 7 would be appropriate.
Before a Chapter 7 bankruptcy gets approval,the applicant is subject to a “means” test. If their income is over a certain level, their application does not get approval. But if a Chapter 7 bankruptcy gets approval, the business is dissolved.
In a Chapter 7 bankruptcy, the bankruptcy court appoints a trustee. The trustee’s job is to take possession of the assets of the business and distribute them among all of the creditors. The order in which creditors get their payments can depend on the type of debt (secured vs. unsecured).
After the distribution of the assets, and the trustee is paid, a sole proprietor receives a “discharge” at the end of the case. It means that the owner of the business is released from any obligation for the debts. But partnerships and corporations do not receive a discharge.
Keep your business protected with our professional business credit monitoring.
Chapter 11 may be a better choice for businesses with a realistic chance to turn things around. It is usually a choice for partnerships and corporations. It can also be an option for sole proprietorships if their income level is too high to qualify for Chapter 13 bankruptcy. For Chapter 11, see: cornell.edu/uscode/text/11/chapter-11.
Chapter 11 is a plan where a company reorganizes and continues in business under a court-appointed trustee. The company files a detailed plan of reorganization explaining how it will deal with its creditors. The company can terminate contracts and leases, recover assets, and repay some of its debts, while discharging others to return to profitability.
The business presents the plan to its creditors who will vote on the plan. If the court finds the plan is fair and equitable, it will approve it. Reorganization plans provide for payments to creditors over some time. Chapter 11 bankruptcies are rather complex and not all of them succeed. It usually takes over a year to confirm a plan.
The Small Business Reorganization Act of 2019 enacted a new subchapter V of Chapter 11. This subchapter of Chapter 11 seems to favor the side of the applicant for business bankruptcy. But it only applies if the applicant wants it to apply. See cornell.edu/uscode/text/11/chapter-11/subchapter-V.
For example, subchapter V does not require the appointment of a committee of creditors, or that creditors have to approve a court plan. Per the U.S. Department of Justice, the act:act: “imposes shorter deadlines for completing the bankruptcy process, allows for greater flexibility in negotiating restructuring plans with creditors, and provides for a private trustee who will work with the small business debtor and its creditors to facilitate the development of a consensual plan of reorganizations. See justice.gov/opa/pr/us-trustee-program-ready-implement-small-business-reorganization-act-2019.
Chapter 13 bankruptcy is a form of bankruptcy for individuals. Since a sole proprietorship is an extension of its one owner, the owner is responsible for all assets and liabilities of the firm. It is most common for a sole proprietorship to take bankruptcy by filing for Chapter 13. This is a reorganization bankruptcy. See Chapter 13: law.cornell.edu/uscode/text/11/chapter-13.
Chapter 13 is good for small businesses when a reorganization is the goal instead of liquidation. The entrepreneur files a repayment plan with the bankruptcy court. This details how they are going to repay their debts. Note: Chapter 13 and Chapter 7 bankruptcies are very different for businesses.
Chapter 13 is vital for individuals whose personal assets are tied up with their business assets, because they can avoid problems like losing a house if they file Chapter 13 versus Chapter 7. Chapter 13 lets a business stay in business and pay its debts. But Chapter 7 does not.
There are two other forms of individual bankruptcy. These are less common. Chapter 12 is bankruptcy protection for family farmers and family fisherman. See uscourts.gov/services-forms/bankruptcy/bankruptcy-basics/chapter-12-bankruptcy-basics. Chapter 15 is bankruptcy protection when a bankruptcy matter involves people from another country. See uscourts.gov/services-forms/bankruptcy/bankruptcy-basics/chapter-15-bankruptcy-basics.
In general, to correct bankruptcy issues, all you or your lawyer will need to do is file an amendment to your bankruptcy petition. These can be errors like forgetting to list an item of property, or disclosing an incorrect property value, or forgetting a creditor or income from a side business. See alllaw.com/articles/nolo/bankruptcy/bankruptcy-petition-mistake.html.
Keep your business protected with our professional business credit monitoring.
Per Investopedia, “A lien is a claim or legal right against assets that are typically used as collateral to satisfy a debt. A lien could be established by a creditor or a legal judgement. A lien serves to guarantee an underlying obligation, such as the repayment of a loan. If the underlying obligation is not satisfied, the creditor may be able to seize the asset that is the subject of the lien. There are many types of liens that are used to secure assets.”
Some of the worst errors when it comes to liens can involve real estate if land was used to secure a debt. Minor or typographical errors are called Scrivener’s errors. You can often fix them through either rerecording the deed of trust or by recording an instrument explaining and correcting the error. You cannot cure more substantial errors except by a Reformation lawsuit. This type of lawsuit asks a court to correct the deed of trust to reflect the parties’ intent.
Keep your business protected with our professional business credit monitoring.
The main ways you can lose in court are if you: default at the start and never answer a summons and complaint, lose a motion for summary judgment brought by the other side, lose a bench or jury trial, or exhaust all appeals and end up on the losing end.
If you or your business lose in court, then you may have a judgment entered against you. Judgments generally take the form of paying damages (money), or specific performance where you must do (or not do) something. Or the court enters an injunction and to prevent you from doing something. A civil judgment can’t send you to jail (that’s criminal, which is rather different).
Errors can take the form of a judgment entered against the wrong person and/or company. Or they can be a typo in the amount of money damages in the court’s records. Maybe there’s a judgment is entered but it’s already been satisfied (paid). Or there can be fraud or other misrepresentation on the part of one of the parties, or excusable neglect. For example, a city recovering from a major hurricane might not make the proper clerical entry of judgments a priority.
Correcting these errors can take several forms. Different states have differing rules. But every state wants their records to be right. They just have different ways you need to go about correcting the record.
For example, in Massachusetts, you or your lawyer will need to make a motion before the court under Rule 60(a). See mass.gov/rules-of-civil-procedure/civil-procedure-rule-60-relief-from-judgment-or-order. In Texas, you or your lawyer would need to file a motion for judgment nunc pro tunc (a motion to have the judgment corrected). See texaslawhelp.org/article/correcting-clerical-error-court-order-answers-common-questions#toc-9.
In Georgia, correcting a judgment comes under the general umbrella of relief from judgments. See law.justia.com/codes/georgia/2010/title-9/chapter-11/article-7/9-11-60. In Louisiana, it falls under an Amendment of Judgment, and you can correct calculation or language errors via motion. See law.justia.com/codes/louisiana/2015/code-codeofcivilprocedure/ccp-1951.
Like with most things, the faster you work to correct a legal judgment, the less it will cost you. In particular if the wrong person (you) is the defendant in a lawsuit, acting as fast as possible will save you in legal fees. Ignoring these problems will not make them go away.
When you secure a loan with property, creditors can tell other creditors about any of your assets in use as collateral for the secured transaction. UCC liens filed with Secretary of State offices act as a public notice by the creditor of the creditor’s interest in the property. It’s in a creditor’s best interests to check for UCC filings, so they can make sure they’re the only creditor with a claim on that collateral.
Like anything else, there can be typographical errors in UCC filings. But the law says that, unless the errors “make the financing statement seriously misleading”, the UCC filing is still in effect. So if you’re depending on a typo to get out of a UCC filing, you might want to rethink that strategy. See law.cornell.edu/ucc/9/9-506.
For the most part, unless the errors are seriously misleading, the UCC says you don’t have to correct them. This is because the policy behind the law governing secured transactions under the UCC explains financing statements provide notice of a transaction. They give enough information to later potential creditors that the debtor’s property may be covered by an earlier creditor’s security interest. Essentially, a financing statement is the starting point in a later creditor’s due diligence process, not the conclusion. See jdsupra.com/legalnews/it-may-be-foul-but-there-is-no-harm-not-11403.
You can fix errors in public documents like judgments and UCC filings, but the mechanism for doing so will differ. This depends on the error, the type of record, and the jurisdiction. The faster you act, the better (and cheaper). Ignoring these mistakes will not make them go away. Correcting mistakes can make your business more fundable.
The post Credit is More Than a Score: How to Address a Derogatory Account on Credit Report When You’re Fighting a Public Record appeared first on Credit Suite.
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Either a personal or a business credit record can have errors in it. There are all sorts of reasons why you or your business would not be able to get funding. Correcting mistakes is one way to make it easier for your business to get money.
Let’s look at errors in public records.
But what’s fundability? Fundability is the ability of a business to get funding. This is everything from getting credit to business loans. Because every business needs money, it quite literally pays to enhance your fundability whenever and wherever you can.
In addition to how well your business pays its bills, and your personal credit score, and whether your industry is felt to be a risky one, there’s the matter of public records.
Public records include bankruptcy (both personal and business), liens, judgments, and UCC filings. Errors in any of these kinds of public records will affect fundability, so correcting such mistakes will enhance your ability to get cash for your business.
Bankruptcy is a process a business goes through in federal court. The idea is to help a business eliminate or repay its debt under the guidance and protection of the bankruptcy court. Business bankruptcies are often liquidations or reorganizations. This depends on the type of bankruptcy an entrepreneur takes.
There are three kinds of business bankruptcy. They are Chapter 7, Chapter 11, and Chapter 13. These types depend on organizational structure. See thebalancesmb.com/what-is-business-bankruptcy-393017.
Corporations are legal business entities separate from their owners. They are more truly separate than partnerships. But in the event of a bankruptcy, either type of structure commonly will file of Chapter 7 (bankruptcy protection), or Chapter 11 (reorganization). The chapters refer to the US Bankruptcy Code.
This one may be the best choice when the business has no viable future. It is often used when the debts of the business are so overwhelming that restructuring them is not feasible. Chapter 7 bankruptcy can be used for sole proprietorships, partnerships, or corporations. It is also appropriate when the business does not have any substantial assets. To read the full text of Chapter 7, go here: law.cornell.edu/uscode/text/11/chapter-7.
If a business is a sole proprietorship, and an extension of an owner’s skills, it often does not pay to reorganize it. Hence Chapter 7 would be appropriate.
Before a Chapter 7 bankruptcy gets approval, the applicant is subject to a “means” test. If their income is over a certain level, their application does not get approval. But if a Chapter 7 bankruptcy gets approval, the business is dissolved.
In a Chapter 7 bankruptcy, a trustee is appointed by the bankruptcy court. The trustee’s job is to take possession of the assets of the business and distribute them among all of the creditors.
The order in which creditors are paid can depend on the type of debt (secured vs. unsecured). Collateral is what you use to secure a debt. With no collateral, a debt is unsecured. As a result, those types of debts are further down the line when it comes to decided who will be paid in a bankruptcy.
After the distribution of the assets and paying the trustee, a sole proprietor gets a “discharge” at the end of the case. It means that the owner of the business is released from any obligation for the debts. But partnerships and corporations do not receive a discharge.
Chapter 11 may be a better choice for businesses with a realistic chance to turn it all around. It is often used for partnerships and corporations. It can also be used by sole proprietorships if their income level is too high to qualify for Chapter 13 bankruptcy. For the full text of Chapter 11 go to: cornell.edu/uscode/text/11/chapter-11.
Chapter 11 is a plan where a company reorganizes and continues in business under a court-appointed trustee. The company files a detailed plan of reorganization. Such a plan explains how it will deal with its creditors. The company can terminate contracts and leases, recover assets, and repay some of its debts, while discharging others to return to profitability.
The business presents the plan to its creditors who will vote on the plan. If the court finds the plan is fair and equitable, it will approve it. Reorganization plans provide for payments to creditors over some time. Chapter 11 bankruptcies are rather complex and not all of them succeed. It usually takes over a year to confirm a plan.
The Small Business Reorganization Act of 2019 enacted a new subchapter V of Chapter 11. This subchapter of Chapter 11 seems to favor the side of the applicant for business bankruptcy. But it only applies if the applicant wants it to apply. See cornell.edu/uscode/text/11/chapter-11/subchapter-V.
For example, subchapter V does not require that a committee of creditors be appointed, or that creditors have to approve a court plan.
Per the U.S. Department of Justice, the act: “imposes shorter deadlines for completing the bankruptcy process, allows for greater flexibility in negotiating restructuring plans with creditors, and provides for a private trustee who will work with the small business debtor and its creditors to facilitate the development of a consensual plan of reorganization.” See justice.gov/opa/pr/us-trustee-program-ready-implement-small-business-reorganization-act-2019.
Chapter 13 bankruptcy is a form of bankruptcy for individuals. Since a sole proprietorship is an extension of its one owner, the owner is responsible for all assets and liabilities of the firm. It is most common for a sole proprietorship to take bankruptcy via Chapter 13. This is a reorganization bankruptcy. For the full text of Chapter 13, go to: law.cornell.edu/uscode/text/11/chapter-13.
Use Chapter 13 small businesses when a reorganization is the goal instead of liquidation. The entrepreneur files a repayment plan with the bankruptcy court. This details how they will repay their debts. Note: Chapter 13 and Chapter 7 bankruptcies are very different for businesses.
Chapter 13 is vital for individuals whose personal assets are tied up with their business assets, because they can avoid problems like losing a home if they file Chapter 13 versus Chapter 7. Chapter 13 lets a business stay in business and pay its debts. But Chapter 7 does not.
There are two other forms of individual bankruptcy. These are less common. Chapter 12 is bankruptcy protection for family farmers and family fisherman. See uscourts.gov/services-forms/bankruptcy/bankruptcy-basics/chapter-12-bankruptcy-basics.
Chapter 15 is bankruptcy protection when a bankruptcy matter involves people from another country. See uscourts.gov/services-forms/bankruptcy/bankruptcy-basics/chapter-15-bankruptcy-basics.
In general, to correct bankruptcy issues, all you or your lawyer will need to do is file an amendment to your bankruptcy petition. These can be errors like forgetting to list an item of property. Or it can be disclosing an incorrect property value or forgetting a creditor or income from a side business. See alllaw.com/articles/nolo/bankruptcy/bankruptcy-petition-mistake.html.
What’s a lien?
Per Investopedia: “A lien is a claim or legal right against assets that are typically used as collateral to satisfy a debt. A lien could be established by a creditor or a legal judgement. A lien serves to guarantee an underlying obligation, such as the repayment of a loan. If the underlying obligation is not satisfied, the creditor may be able to seize the asset that is the subject of the lien. There are many types of liens that are used to secure assets.”
Some of the worst errors when it comes to liens can involve real estate if using land to secure a debt. Minor or typographical errors are called Scrivener’s errors. You can often correct them by rerecording the deed of trust or by recording an instrument explaining and correcting the error. But you cannot cure more substantial errors except by a Reformation lawsuit. This type of lawsuit asks a court to correct the deed of trust to reflect the parties’ intent.
Businesses of all sizes can be on the defense end of a lawsuit. Lawsuits can be for everything from a customer slipping on ice in your parking lot to a supplier suing to get you to pay them.
The main ways you can lose in court are if you default at the start and never answer a summons and complaint. Or you could lose a motion for summary judgment brought by the other side. Another way to lose is to lose a bench or jury trial. Or you could exhaust all appeals and end up on the losing end.
If you or your business lose in court, then a judgment may be entered against you. Judgments generally take the form of paying damages, which is money. Or the judgment could be for specific performance where you’re required to do (or not do) something. Another option is an injunction is entered and you may be prevented from doing something. A civil judgment can’t send you to jail. That’s criminal, which is rather different.
Errors often take the form of a judgment entered against the wrong person and/or company, or a typo in the amount of money damages listed in the court’s records. Or the judgment is entered but it’s already been satisfied (paid). Another kind of error is fraud or other misrepresentation on the part of one of the parties. Plus there could be excusable neglect. For example, a city recovering from a major hurricane might not make the proper clerical entry of judgments a priority.
Correcting these errors can take several forms. Different states have differing rules. But every state wants their records to be correct. They just have different ways you need to go about correcting the record.
You or your lawyer will need to look up how to correct mistakes in a legal judgment in your state (or the District of Columbia or a US territory, like Puerto Rico).
For example, in Massachusetts, you or your lawyer will need to make a motion before the court under Rule 60(a). See mass.gov/rules-of-civil-procedure/civil-procedure-rule-60-relief-from-judgment-or-order. But in Texas, you or your lawyer would need to file a motion for judgment nunc pro tunc. This is a motion to correct the judgment. See texaslawhelp.org/article/correcting-clerical-error-court-order-answers-common-questions#toc-9.
In Georgia, correcting a judgment comes under the general umbrella of relief from judgments. See law.justia.com/codes/georgia/2010/title-9/chapter-11/article-7/9-11-60. In Louisiana, it falls under an Amendment of Judgment, and you can fix calculation or language errors ia motion. See law.justia.com/codes/louisiana/2015/code-codeofcivilprocedure/ccp-1951/.
Like with most things, the faster you work to correct a legal judgment, the less it will cost you. In particular if the wrong person (you) is the defendant, acting as quickly as possible will save you in legal fees. Ignoring these problems will not make them go away.
When you secure a loan with property, creditors can tell other creditors about any of your assets in use as collateral for the secured transaction. UCC liens filed with Secretary of State offices act as a creditor’s public notice of their interest in the property.
It’s in a creditor’s best interests to check for UCC filings. This is so they can make sure they’re the only creditor with a claim on that collateral.
Like anything else, there can be typographical errors in UCC filings. But the law says that, unless the errors “make the financing statement seriously misleading”, the UCC filing is still in effect. Are you depending on a typo to get out of a UCC filing? You might want to rethink that strategy. See law.cornell.edu/ucc/9/9-506.
For the most part, unless the errors are seriously misleading, the UCC says you don’t have to fix them. This is because of the policy behind the law governing secured transactions under the UCC. Essentially, financing statements exist to provide notice of a transaction. And they are also meant to give enough information to later potential creditors that the debtor’s property may be covered by an earlier creditor’s security interest.
Hence, a financing statement exists as a starting point in a later creditor’s due diligence process, not the conclusion. See jdsupra.com/legalnews/it-may-be-foul-but-there-is-no-harm-not-11403/.
Your personal credit record can directly impact your business credit record. Both need to be right. And correct records are more likely to get your business money.
It’s possible to fix errors in public documents like judgments and UCC filings. But the mechanism for doing so will differ. This depends on the error, the type of record, and the jurisdiction. The more quickly you act, the better and cheaper it will be for you. Ignoring these mistakes will not make them go away. Correcting mistakes can make your business more fundable.
For more information on fundability and getting business credit, contact us today.
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V. Promotion, Sales, Public Relations, Marketing, and also Advertising If they are not to continue to be latent possibilities, benefits have actually to be interacted to possible clients. Interaction alone – the exchange of details – is not sufficient. Customers need to be affected as well as inspired to see a nation, purchase it, or … Continue reading Country Branding as well as Place Marketing – V. Promotion, Sales, Public Relations, Marketing, as well as Advertising
Bill and his guests – Rep. Adam Schiff, Jon Favreau, Michael “Killer Mike” Render, Matt Welch, and Annabelle Gurwitch – answer viewer questions after the show. (Originally aired 5/12/17)
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