SRS Starting to think "Whats the point"

Discussion in 'On Topic' started by Gunna, Jun 1, 2009.

  1. Gunna

    Gunna OT Supporter

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    I've always been pretty upbeat, but in recent times i've started to think "whats the point"

    Backstory:
    Bought a business with my brother and mother, we went thirds in it. Business failed due to accountant of previous owner being damn good at masking incorrect sales and dodgy dealings as well as a downturn in business, despite us doing everything we could, including injecting over $20k in various ways to increase sales, the business still failed, pretty much left us with $150k in debt, now mum was going to loose her house as it was used as collateral on the loans we took out to buy the business.

    So I stepped up and went with her in the loans needed to re-finance for her to keep her house, but all three of us pay an equal amount in the loans for the business debt, which we are paying extra on as well, we each pay $110 a week and the loan only requires us to pay $900 a month, mum has an extra $70k to pay that was remaining on her old home loan, which has been taken out as a 2nd loan, so my share of the loan is $50k, mums is $50k(with an extra $70k home loan) and my brothers is $50k, now my brother and mum are pretty much set in regards to having houses, work etc.

    But it just seems as soon as I try to get anything for myself that requires a credit check(I want a Motorbike, I have no car, sold it and money went on my personal loan, 6 months at current repayments owning and I'm paying $140 a month more then i need too)i get knocked back due to me being on the loan for mums house, even though the repayments would be less then i'm making now on my current personal loan, and the home loan won't get paid off for the next 15-20 years at the current rate we are paying it off at, i feel that i'll have to go without for the next 2 decades and i don't know what to do......

    I mean I love my mum to bits, but I want to live my life, have the things I think I work hard to get but it just seems i'm the one going without so everyone else can maintain their current life style. I mean my brother, who in the next 5 - 10 years is going to do very very well hasn't offered at all to try to get my name off the loan and put his on instead seeing as he won't need to apply for loans etc any more.....

    I'm just stuck, i mean it's not like I want mum to sell her house or anything like that, i just don't like the situation i'm in and i feel all i'm doing is living to allow everyone else to have what they need/want and it's getting me down in a big way
     
  2. Darketernal

    Darketernal Watch: Aria The Origination =)

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    Well they say 'if your going thru hell keep going', if possible you guys should sue the previous owners ass to try to get some money back. The main focus should lie on deleting the enormous debt as soon as possible. Unfortunatly that means moving and living in a lot smaller space and sell all great assets to delete the huge debt as soon as possible.

    So under ordinairy circumstances personally i would sell your moms house, but the house market couldn't be worse at the time, so i still think you did a good job into trying to keep your mothers house, it would also be a psychological shock for her to sell such an asset, i think that 'if circumstances improve in the house market in the future', it would be a more wise moment to sell, also because your mom would be more accustomed to the bad situation and would have more understanding in financially trying to be in a neutral zone instead of debt. So don't sell the house unless better circumstances arrive and be weary not to be scammed anymore.

    If possible i would try to keep the bussiness going, or start somewhere else ,trying to push yourself thru the difficult circumstances because if your bussiness is profitable then in long term you could fight yourself out of this mess. But this requires a lot of carefull planning, i feel really bad for you not being able to get that bike, but maby that would be the point for you to keep fighting on so that eventually you will be able to ride on that bike.
     
  3. Gunna

    Gunna OT Supporter

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    Cheers for the advice.

    We looked into taking the accountant to court, however in Australia because the debt would be greater then 250k(This includes the price of the business and the profits the business was supposed to make, as well as court costs) we need to go to the Supreme Court of Australia, this means hiring a barrister, a forensic accountant and more people on the legal team, we would be looking at spending close to $160 000 to sue, and if we loose we need to pay the court costs of the other people. So seeing as we would be suing him and he has insurance we would be dealing with the insurance company, and generally these cases are who has the most money. So a debt of $150 000 could turn into $600 000 if we loose.

    The business has gone under already, so being able to sell or increase business isn't an option. Also the house market in mums area is pretty poor, having dropped roughly $30 000 in last 12 months :/
     
  4. GregFarz78

    GregFarz78 New Member

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    No offense but you should've thought about that before entering a business partnership with family, most businesses fail its just a fact so now you need to face the fallout and pay off the portion of the debt that is yours
     
  5. Gunna

    Gunna OT Supporter

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    Oh we did, but what hurt us was that the business was loosing $1000 a week from day one, so we had to cover that as well as inject money into the business, this business was an established business who had been around a while(7 years), so from a buyers point of view the chances of it going under appeared to be reduced then say a new business, which statistically go under int he 1st 12 months, however the previous accountant made it look like it was making $1300 a week. We were under the impression that the business would cover the loans and if we sold/went under it would be after the business had paid of a decent chunk of the loan, this was the advice we were given with the figures provided, however with us having to over extend to keep the business afloat from day one, it begun to dig us deeper and deeper into debt, until finally it all came crashing down.
     

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