To start with, our average client has 18.6 lenders!
When you retain a professional to assist you in the restructuring of your debt, it usually takes about four weeks to gather all the financial information (depending on what rental software you are using), assess the rental operations performance, build a viable and sustainable cash flow model, determine the type of bank restructure you are going to request, and prepare a presentation to your lenders.
Our firm normally contacts all of your lenders, immediately, to let them know that we have been retained to assist you. Once we have made the presentation to the lenders, things start to slow down, as now it is up to the lenders to review the package and determine if they have an interest in participating in the restructure. Then it has to go to committees for approval, and some lenders have as many as five different committees that must approve the restructure. Any one of committees could turn down the proposal, or request additional information, or send it back to yet another committee. This is a really tedious procedure and most rental owners wear down during this part of the process if they are trying to do the debt restructure themselves.
So you can continue to run your business, a great deal of that burden will be taken from your shoulders by the firm you retain to develop and manage your debt restructuring program. Our company, for example, represents its clients throughout the entire refinancing process - from comprehensive program development in a format that meets all lender requirements, and a working business model for you through all of the personal negotiations with your lending resources.
To answer the question of how long does it take to get a debt restructure done....it could be as fast as six weeks from start to finish, or as long as eight months.
Questions or comments? Contact Mike Farley at [email protected].
