Chat with us, powered by LiveChat

How One Manufacturer Negotiated Debt Relief to Keep Its Doors Open

When business slowed to a crawl last year, J&S Manufacturing faced a harsh reality – without an influx of cash or new business, they would likely have to shut down permanently. “We saw orders drying up left and right as clients cut back on spending,” said Jim Thompson, J&S’s CEO. “Within a few months, revenue was less than half of what it was pre-pandemic.”

The abrupt change left J&S struggling to make payroll and payments on their loans and lines of credit. As Jim describes it, “We had all our eggs in one basket when COVID hit, and that basket got smashed.”

- -

After attempting to negotiate with their creditors on their own for several months with no success, J&S eventually turned to a debt relief company for support. “We just didn’t have the expertise or bandwidth to effectively negotiate complex settlements. The debt relief company took all that off our plate so we could focus on operating the business,” Jim explained.

Choosing a Legitimate Debt Relief Company

With so many debt relief companies making dubious claims, J&S moved cautiously in vetting potential partners. They specifically avoided companies that:

  • Promised to make debt “magically go away” or stop all collection calls immediately;
  • Pushed a “new government program” to eliminate personal debt;
  • Guaranteed they could settle debt for pennies on the dollar without reviewing individual accounts;
  • Instructed them to stop communicating with creditors.

“If it sounds too good to be true, it probably is,” Jim said. “We ultimately went with Rhodes Debt Negotiation because they took the time to understand our specific situation.”

Rhodes reviewed all outstanding debts and developed customized proposals for each creditor, rather than making blanket promises. “It was clear they did their homework on the accounts and had a lot of experience getting deals done,” said Jim.

Negotiating with an Empathetic Approach

J&S and Rhodes decided an empathetic approach would give them the best shot at striking a deal with creditors. “We focused the conversations on how COVID significantly reduced business, making it impossible to meet existing payment terms,” Jim explained. “We made it clear we wanted to pay what we could, but needed some compromise to avoid bankruptcy.”

Tapping into the financial hardship J&S faced made creditors more willing to negotiate – after all, partial payment is better than no payment at all. “We had to show them we were truly in distress. Most understood and wanted to work something out,” said Jim.

J&S and Rhodes made sure not to lose sight of what payment amounts were feasible, however. “If we offered too much, we’d be back in the same hole in 6 months,” Jim said. “We started the negotiations pretty low, knowing we’d eventually land somewhere in the middle.”

Securing Agreements in Writing

After months of discussions, J&S successfully negotiated discounted settlements with all outstanding debts. With Rhodes’ help, they achieved an average 67% reduction across the accounts.

Once new terms were agreed upon, getting everything in writing was crucial. As Jim put it, “Verbal agreements don’t mean much – creditors can still send an account to collections even after a handshake deal.”

To date, J&S has formal settlement contracts in place with their bank, two equipment financing companies, and their largest vendor. “The written agreements give us confidence and prevent misunderstandings down the road,” said Jim.

Delancey Street is here for you

Our team is available always to help you. Regardless of whether you need advice, or just want to run a scenario by us. We take pride in the fact our team loves working with our clients - and truly cares about their financial and mental wellbeing.

"Super fast, and super courteous, Delancey Street is amazing"
$500,000 MCA Restructured Over 3 Years
"Thanks for helping me in literally 24 hours"
$250,000 SBA Loan Offer in Compromise
"Great choice for business owners who need a trustworthy partner"
$350,000 MCA Restructured Over 2 Years

In The Media

Delancey Street CEO discusses ways to reward employees
Delancey Street CEO discusses the benefits of franchising on Forbes.
Delancey Street CEO discusses management on AMEX.
How to Lower Your Monthly Auto Loan Payment

How to Lower Your Monthly Auto Loan Payment A high…

Boston Merchant Cash Advance Attorney

Boston Merchant Cash Advance Attorney Getting a merchant cash advance…

How To Get Out Of A Merchant Cash Advance – MCA Debt Relief

How to Get Out of a Merchant Cash Advance So…

Getting Free Help with Your Student Loans is Incredibly Easy

Getting Free Help with Your Student Loans is Incredibly Easy…

6 Signs Your Future Spouse Is Bad With Money

  6 Signs Your Future Spouse Is Bad With Money…

Delancey Street simply gets it. You're talking to experts.
Steven Norris
Get Help Today

Ready To Get Started?

If you have questions, feel free to shoot us an email, or fill out our live chat.

Schedule Consultation