Some Californians who own businesses might worry that their prior bankruptcy cases may keep them from being able to get approved for business loans. While it might be more difficult to qualify after bankruptcy, it is possible for business owners to find loans that they might be able to obtain.
Some lenders are more concerned about whether the bankruptcy case is over. If a case is closed, an owner may be able to secure a business loan. If the bankruptcy case is still open, it may be more difficult to secure financing.
Other lenders want to see that a bankruptcy case is old. If people have a bankruptcy several years in the past, the lenders may be willing to extend credit to them if they have since established good credit histories. Similarly, lenders may be likelier to approve business owners that have good credit scores regardless of whether or not they filed for bankruptcy protection. In most cases, lenders will be okay with bankruptcies that occurred five or more years in the past.
Having a prior bankruptcy will not necessarily bar business owners from getting approved for business loans. Those who want to learn about how their prior bankruptcy cases might affect them may want to talk to their bankruptcy lawyers. People who are facing unmanageable debt may be better off filing for bankruptcy and then working to rebuild their credit after their debts are discharged. While the bankruptcies may continue to be reported for up to 10 years, it is possible for people to begin rebuilding their credit immediately so that they can have fresh financial starts.