Do you really need to form a corporation?

People that are starting a business often think they need to form a new corporation or LLC right away. Not so fast. What are the benefits of operating as a seperate entity? The principal advantage of doing business as a corporation is that there is limited liability. What this means is that the ownwers (shareholders) cannot be held to answer for the debts of the business. Sounds great, but as a practical matter the corporate entity gives very little protection to most small companies. Banks and other grantors of credit usually have the owners sign personally for any credit extended. At least it helps reduce liability or injuries caused by my business, right? It does, but it does not protect you from your own misdeeds, just those of other employees of the company. As the vast majority of businesses have no employees, the owner will always be on the hook for his actions. In addition, the owner is generally able to cover any potential liability claims through insurance. Forming a corporation may make sense, but make sure it does before you waste your valuable time and money.


Eliminate your Second Mortgage

Do you have a second mortgage that you are unable to pay? You may be able to eliminate the payment and pay it off through a Chapter 13 Plan in as little as three years. It sounds too good to be true, but because of the declining value of real estate it is possible. If your First mortgage is equal to or greater than the current value of your house, you can treat the second mortgage the same as you treat ordinary credit card debt. This is called a cram-down because you are forcing the Bank to accept less than they are due under your original agreement. Through your plan you make a small monthly payment to the Bankruptcy Trustee. The Trustee will in turn pay a percentage of your debts. Upon successful completion of your plan, your second mortgage is discharged along with your credit card and other unsecured debt.


Wills, Powers of Attorney, & Health Care Proxies

Doing a simple Estate Plan which includes a Will, Power of Attorney and Health Care Proxy is a GIFT to your family, and will safe them, time money and aggravation if anything happens to you.  It's relatively inexpensive too!  Most simple estate plans are under $500.00.