When you decide to sell your business, you have a few options for handling the financial details, such as offering your buyer financing. This not only gives the buyer ample time and flexibility when it comes to acquiring the business but it also gives you more control over the details of the sale. However, when your buyer stops paying, this can throw your finances into a tailspin but there are a few actions you can take as you move forward with your attempts to collect payment.
- Avoid Further Direct Contact
If letters, phone calls and texts have gone unanswered and you believe your buyer is deliberately avoiding you, let him or her know that you intend to pursue legal action for non-payment. Once you have announced your intent, contact an attorney to discover what your collection options might be moving forward. Even if the buyer is having trouble meeting his or her financial obligation to you, this is not an issue he or she has the legal right to avoid.
- Collect Payment Records
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Once you decide to file a lawsuit against the buyer, the burden of proof will likely fall upon you, so take the time to collect past payment records and note a few dates such as the day of purchase and how many actual payments you received. Save text messages related to the sale of your business and submit these to your attorney as you work together to build a case.
- Review the Contract
Reviewing the original business contract with your attorney can help you understand which clauses state payment and financing details clearly and what recourse you have for repayment through legal channels. If the seller claims the language was unclear and led to confusion regarding payments, a thorough review of the contract may disprove the claim.
- Act Via Your Attorney
If the buyer does contact you once you file a lawsuit, it is wise to avoid speaking to him or her until your attorney is present. This can help you avoid making verbal errors that could affect the outcome of your case. You may want to advise the buyer that you are no longer willing to make any further agreements about missed payments until the court case commences. Your attorney can advise you if the buyer wants to resolve the issue in arbitration or wishes to redesign the contract.
When the buyer for your business suddenly terminates financed payments, it can be a frustrating and stressful time, but help is available. Contact a business lawyer, like from the Law Office of Daniel Wright, today for more information and assistance.
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