Tempe lawyer describes steps for businesses to avoid bankruptcy
PHOENIX – Many Maricopa County businesses are on the verge of bankruptcy as the coronavirus outbreak continues to take its economic toll.
“That really loud noise you hear behind you is a massive tidal wave that’s getting ready to crash on you – of bankruptcies,” Lamar Hawkins, an attorney with Guidant Law Firm in Tempe, told KTAR News 92.3 FM.
Business facing dire financial circumstances can avoid economic collapse if they act quickly, he says.
Hawkins encourages business to first try and place as many loans into forbearance as possible.
It’s also important that business owners protect cash reserves and keep from making any extra payments until the coronavirus outbreak ends, Hawkins advised.
He also recommends businesses call their billers, creditors and landlords with requests to delay payments until after the coronavirus crisis ends.
Bankruptcies were up 5% in March year-over-year in Maricopa County, according to Hawkins.
Hawkins noted that evictions are also far from a simple process during the current health crisis.
“Right now, a landlord can’t kick a tenant out with a forcible detainer action and a writ of execution on it,” Hawkins said.
He believes landlords want to keep their tenants instead of finding new ones to help them pay their mortgages.
“The immediate thing you need to say to your landlord is: ‘Look, I can’t make you a dime of payments today until my business is back up and running, and as soon as it is, I want to work something out. I want you to know I’m here. I want to be here. I want to stay here,’” Hawkins said.