Today's challenging economy has left many small business owners in debt. If your small business is in debt and you are looking for ways out of it, there are places to turn for help. You should realize you are not alone in your situation, and there are a few guidelines you can use to help eliminate your small business debt.

Get a copy of your credit report.

You need to first evaluate where your business finances stand. For many small business owners, you have used your personal credit to establish your business. Thus, your business debt is your personal debt. You should obtain a copy of your credit report and thoroughly review it. If there is any wrong information you will need to correct it by contacting the credit agency and filing a formal dispute. To receive a free credit report visit www.annualcreditreport.com.

Add up your small business debt.

Now you will need to add up the total amount of your small business debt. Include outstanding debts from your credit report, creditors, any amounts owed to suppliers and employees, and more. You will need a true calculation of what you owe to start to make a plan for eliminating it.

Run the numbers

You need to start running some number projections to prepare a plan to eliminate your small business debt. Conservatively guesstimate how much you expect to profit in the every month for the next year. Then, look for ways in which you can increase your profits. Can you work more hours? Can you raise prices? After maximizing your profits, looks for ways to decrease expenses. Can you cut back on employee hours or positions? Can you eliminate some expenses?

Apply for a debt consolidation loan

If your credit standing is good or excellent, you may qualify for a debt consolidation loan for small business owners. This would combine all of your outstanding debts into one new loan with one payment. Typically this will lower the interest rate you pay and may make your debt obligations more manageable. Bankrate.com displays local interest rates on their website.

Consider asking friends and family for a consolidation loan

If your credit standing is not in good enough shape for a conventional debt consolidation loan, you may need to seek assistance from a friend or family member. They can invest their money with you so you can consolidation your debts. In return, you would pay them a higher interest rate than they could make in a savings account. To satisfy both parties, put the loan terms in writing. Websites such as www.legaldocs.com and www.lawdepot.com has loan agreements for these purposes.

Use credit cards

As a last resort you may need to consolidate your debts onto a low interest credit card. If so, make sure you have a plan to repay this credit card. Step 9 will have added details on doing so.

Do not incur new debt.

After consolidating your debts, you must commit to not taking on any new debts. You should only pay cash for items you need until your business is out of the red. If the numbers don't jive, you will need to look for ways to increase your income.

Earn more income

If you cannot generate enough income with your small business to pay your debts, you may have to seek part time employment to earn more money. This money should only be used to pay off your debts.

Contact your creditors

You should contact each and every creditor to explain how you are paying off your small business debt. Let them know how much money you can pay every month. If any of your debts are delinquent you may need to enter into a debt settlement where they will take pennies on the dollar. Be wary of these agreements because they can lower your credit score.

Use the debt snowball method

The debt snowball method of debt reduction is a process for eliminating debt fast. This works by paying the minimum payments on all of your debts except the smallest debt. On the smallest debt you will pay more than the minimum. The amount extra you pay will be based on what you can afford. Once that bill is completely paid off you will move onto the next smallest debt and start applying more payments to that debt. You will continue in this fashion until all of your debts are paid off.

Example: Your MasterCard has a balance of $2000.00 with a minimum $50.00 payment and your Visa has a balance of $1000.00 with a minimum $15.00 payment. You can afford a $150 monthly payment. Using the debt snowball method, pay MasterCard $50.00 and pay Visa $160.00 (minimum + $150.00 extra). Once Visa is paid off, pay $210.00 to MasterCard until that bill is paid off.

Don't get into small business debt again.

After you have eliminated your small business debt you must keep the cycle from repeating. Make a promise to yourself to not get into small business debt again. Stick to a realistic budget and always look for ways to increase your profits.