Fort Worth Aerospace Suppliers: 8 Debt Moves That Keep Your FAA Approvals Intact

Why an Aerospace Supplier’s Balance Sheet Misleads Everyone Who Reads It

A Fort Worth machining, forming or finishing shop that holds an FAA production approval and carries a shelf of tagged inventory looks, on paper, like a business with genuine hard collateral, and that appearance is a large part of why the advances got written at all. A sales based financing underwriter prices your file on deposit volume and revenue consistency rather than on what the assets would actually fetch, so a supplier pushing $9 million a year through one operating account reads as strong right up until the week the debits stop clearing. What almost nobody on either side of that table has worked through is that the fixtures, the raw bar stock, the work in process and the finished parts on your racks carry radically different values depending on who is holding them, because federal aviation regulation rather than market demand decides whether a given part can lawfully be sold as an aircraft part at all.

That gap is the whole story of an aerospace restructuring, and it cuts in both directions. It hurts you when a funder that never understood the collateral writes an advance sized to your revenue and then discovers the revenue was never the point, because it helps you enormously in a negotiation once somebody actually explains what a foreclosure would produce. Fort Worth sits near the top of an airframe supply chain, with F-35 production and a deep rotorcraft base pulling tier two and tier three work across Tarrant County and out along the I-35W corridor, and the shops that feed it live on long term agreements signed years before the material, labor and energy costs that now define their margin. The distress in these files is rarely mysterious. It is usually a price locked in 2021 or 2022 meeting a cost structure from 2026. Plenty of tier three shops hold no FAA approval of their own and build to print under a customer’s approval, and for them the equivalent asset is the approved source list position and the qualified process, which behaves the same way in a workout because it also cannot be sold at a foreclosure sale.

The eight items below are written from the counterparty’s chair, which is the only view that changes anybody’s number. A funder settles when the alternative to settling looks expensive, slow or uncertain, and for an aerospace supplier the alternative looks worse than in almost any other industry a receivables desk touches. Every claim here is keyed to the regulation, statute or reported decision that makes it true, because your funder’s counsel will check, and an argument that survives that check is the only kind worth building a settlement on. Where the law is thin or unsettled, and on the question of what happens to a production approval in a foreclosure it genuinely is thin, that is said plainly rather than papered over. If you are comparing outside help, our review of business debt settlement companies in Fort Worth covers who does what and what each approach costs.

1. Price the Collateral the Way a Foreclosure Buyer Has To

The document that lets you build a flight part is not a piece of property in any ordinary sense. Under 14 C.F.R. §21.1(b)(7) a production approval is the FAA’s permission for a specific person to produce a specific article under a specific approved design and an approved quality system, and it comes in three flavors: a production certificate, a parts manufacturer approval, and a technical standard order authorization. Each of the three carries an express, one sentence transfer bar. Section 21.144 says the holder of a production certificate may not transfer it, §21.314 says the same about a PMA, and §21.614 says the same about a TSO authorization or a letter of TSO design approval. There is no consent procedure written underneath any of them, no assignment form and no fee schedule, because the FAA did not build a transfer mechanism to be used.

Set that against §21.47, which does the opposite for design approvals: a type certificate holder may transfer the certificate or license it to somebody else, subject only to written advance notice identifying the transferee and the anticipated date. The regulatory scheme therefore treats the design as an asset that can change hands and the permission to manufacture as something attached to an organization, a quality system, an accountable manager under §21.135, and a set of inspected facilities. Repair stations work the same way and say it even more directly, since §145.57(b) provides that where the holder of a repair station certificate sells or transfers its assets and the new owner wants to run a repair station, the new owner must apply for an amended or a new certificate under §145.51.

Now run a foreclosure through that. A secured party that takes your equipment under Tex. Bus. & Com. Code §9.610 gets machine tools, gauges, fixtures and whatever inventory it can lawfully move. It does not get the production approval, it cannot operate under yours, and if it planned to keep the shop running in place it also runs into §21.139(b), which requires FAA approval before any change in the location of manufacturing facilities, and §145.105(a), which forbids a repair station from changing the location of its housing without written FAA approval. What the lienholder is actually buying is a used equipment auction plus a certification project measured in quarters, and the person who explains that arithmetic to the funder before the demand letter goes out is usually the person who sets the settlement range.

Be honest about the limit of the argument, because a well advised creditor will find it. Article 9 anticipates collateral that is licensed or permitted: §9.408(c) makes a rule of law restricting assignment of a general intangible ineffective as to creation, attachment and perfection, but §9.408(d)(1) through (d)(6) then strip the interest of nearly everything that matters, providing that it is not enforceable against the obligated person, imposes no duty on that person, does not entitle the secured party to use or assign the debtor’s rights, and does not entitle the secured party to enforce the interest at all. We could not locate a published decision squarely holding whether an FAA production approval is even a general intangible a lien can reach, and no page should pretend otherwise. What moves the number is that nobody wants to litigate that question while your customer’s line runs short and a program office starts asking who your replacement would be.

2. The Tag Is the Part, and Untagged Stock Prices at Scrap

The physical object on your rack is only half of what your customer is buying, and in a liquidation it is the less valuable half. Section 21.137(o) requires a production approval holder that intends to issue authorized release documents to have written procedures for selecting, appointing, training, managing and removing the individuals who sign them, and the document that ordinarily comes off that process is FAA Form 8130-3, the Authorized Release Certificate and Airworthiness Approval Tag, whose completion the FAA prescribes in Order 8130.21. Behind it sits §21.137(k), which requires quality records to be retained for at least 5 years for articles produced under the approval and at least 10 years for critical components identified under §45.15(c). In this industry the traceability file is a constituent part of the product rather than the administrative record that sits beside it, and a part separated from its file has been separated from most of its value.

That is why an asset based appraiser walking your floor writes a number you will find insulting. Section 21.9(a) provides that a person who knows or should know a replacement or modification article is reasonably likely to be installed on a type certificated product may not produce it except under a type certificate, an FAA production approval, or one of the narrow alternatives such as a standard part or an owner produced part, and §21.9(b) then prohibits representing such a part as suitable for installation on a type certificated product outside those first two routes. Section 21.137(h)(2) goes further and requires procedures ensuring that discarded articles are rendered unusable. A creditor holding your finished goods holds metal that it is not permitted to sell into the market the metal was made for, which is why field liquidation values on aerospace work in process routinely land at a small fraction of standard cost.

The same inventory is worth a great deal to exactly one buyer, and that asymmetry is the most underused leverage in these files. Your prime or your tier one customer holds a build schedule with your part number on it, an approved source list that names you, and a requalification path for any replacement source that runs through first article inspection, source approval, qualification of any special processes, and a quality management system certified to the AS9100 standard published by SAE International through a body such as the Performance Review Institute. A customer facing a line stoppage will often pay early, buy the tagged inventory outright, or fund a bridge, and it will do all three faster than it will requalify a source. None of that value is available to a lienholder, and pointing that out is a negotiation, not a threat.

One thing stays off the table no matter how bad the cash position gets, because nothing in a cash crisis justifies improving the paperwork, back dating a certificate of conformance, or shipping stock whose traceability you cannot substantiate. Under 18 U.S.C. §38(a)(1)(C) it is a federal offense to knowingly and with intent to defraud make or use any materially false writing, certification, record, data plate or label concerning an aircraft part, and §38(a)(2) reaches selling or installing a part by means of a fraudulent document. Where the offense relates to aviation quality and the part is installed, §38(b)(1) authorizes a fine up to $500,000 and up to 15 years, §38(b)(5)(A) allows a fine up to $10,000,000 against an organization, and §38(c)(1)(A) lets a district court order a convicted person to destroy, or mutilate and sell as scrap, entire parts inventories.

3. The Long Term Agreement Signed at the Old Price

Most aerospace supplier distress does not begin at a funder. It begins with a long term agreement, usually a multiyear requirements or blanket structure at fixed or escalator capped pricing, that the shop signed to lock in volume and that has since been overtaken by material, labor and energy costs. Under Tex. Bus. & Com. Code §2.306(a), a term measuring quantity by the buyer’s requirements means the requirements that actually occur in good faith, with the limit that no quantity unreasonably disproportionate to a stated estimate, or in the absence of an estimate to normal or comparable prior requirements, may be tendered or demanded. The section governs quantity alone and says nothing whatever about price, which is the distinction that decides whether a supplier can reopen a long term agreement on cost.

From the prime’s side of the table, that silence is the entire commercial position. Your customer priced its own downstream commitments off your number, holds the same fixed price exposure to its customer that you hold to it, and knows that repricing one distressed supplier is an invitation for every other supplier on the program to open the same conversation. Supply chain organizations at that level are staffed and measured on avoiding exactly that precedent. What they will do instead, and will do quickly, is change the timing and the terms around the price while leaving the price alone: accelerated payment, a tooling buyback, a raw material buy on their paper, a consigned stock arrangement, or a higher price applied only to a future tranche or a new part number.

The reported requirements contract law lines up with that instinct. In Empire Gas Corp. v. American Bakeries Co., 840 F.2d 1333 (7th Cir. 1988), Judge Posner worked through whether a requirements buyer may reduce its takings to zero and framed the constraint as good faith rather than as a fixed floor, and Texas appellate courts try the same kind of supply fight under the identical state enactment, as in Keyes Helium Co. v. Regency Gas Services, L.P., 393 S.W.3d 858 (Tex. App. Dallas 2012), a U.C.C. supply contract case the jury resolved with a finding of no breach. The flexibility §2.306 creates runs toward the buyer’s quantity rather than toward the seller’s margin, so a supplier reading the section as a repricing clause has misread which party the drafters were worried about.

So do the arithmetic before you do anything else, and do it per shipset rather than in aggregate. Take the contract price per unit, subtract fully burdened cost including scrap, rework, outside processing and expedite freight, and multiply by the units still owed under the agreement. If that product is negative, no financing structure fixes it, and every advance you take converts a contract problem into a contract problem plus a lien. That distinction matters because a funder can be settled with and a signed LTA generally cannot, so the order of operations is to fix the agreement first and then negotiate the paper that was papering over it.

4. Section 2.615 Is Not the Exit It Sounds Like

Every distressed supplier eventually finds commercial impracticability, and it is worth understanding precisely how narrow it is before building a plan on it. Tex. Bus. & Com. Code §2.615(1) excuses delay or non delivery where performance as agreed has been made impracticable by the occurrence of a contingency the non occurrence of which was a basic assumption on which the contract was made, or by good faith compliance with an applicable domestic or foreign governmental regulation or order. The operative phrase is basic assumption, and it does real work. A cost increase, even a severe one, is ordinarily treated as a risk the parties allocated when they wrote a fixed price rather than as an event they assumed away.

The canonical statement of that principle comes from a fixed price fuel supply fight rather than from aerospace. In Northern Indiana Public Service Co. v. Carbon County Coal Co., 799 F.2d 265 (7th Cir. 1986), the Seventh Circuit rejected a long term buyer’s attempt to escape a fixed price contract that market movement had made uneconomic, reasoning that a party who contracts at a fixed price has bought protection against price movement in one direction and sold it in the other. Courts applying §2-615 have generally followed the same instinct, and the honest summary for a Fort Worth machining shop is that raw material inflation, tariff exposure and labor cost will not excuse you from an LTA, and any counsel who says otherwise is selling optimism.

There are two parts of the section suppliers routinely ignore that are worth more than the excuse itself. Section 2.615(2) provides that where the disabling cause affects only part of your capacity, you must allocate production and deliveries among your customers, and you may allocate in any manner that is fair and reasonable while including regular customers not then under contract as well as your own requirements for further manufacture. Section 2.615(3) requires that you notify the buyer seasonably of the delay or non delivery and, where you have allocated, of the estimated quota available to that buyer. A documented, even handed, timely allocation is defensible. A shop that quietly starves its worst priced customer to feed its best has handed that customer a breach claim.

Where the section does have teeth is a genuine supervening event rather than a price shock: a sole source alloy under government allocation, a supplier’s plant destroyed, a regulatory order that forecloses a process you were using. Even then, read what the excuse buys. It excuses delay or non delivery for the period of the contingency. It does not rewrite the price, it does not survive the contingency, and it does not stop your funder’s daily debit. Treat §2.615 as a shield for a specific interval, and build the actual restructuring on the commercial conversation instead.

5. Answer the Assurance Demand Inside Thirty Days

The moment a prime hears that you have a payment default, a new UCC-1 or a supplier financial watch flag, its legal group reaches for Tex. Bus. & Com. Code §2.609. That section says a contract for sale imposes on each party an obligation that the other’s expectation of receiving due performance will not be impaired, and that when reasonable grounds for insecurity arise, the other party may demand adequate assurance of due performance in writing and, if commercially reasonable, may suspend its own performance until the assurance arrives. Between merchants, §2.609(b) measures both the grounds and the adequacy by commercial standards. Subsection (d) sets the clock: failing to provide adequate assurance within a reasonable time not exceeding 30 days after a justified demand is a repudiation of the contract.

Understand what that letter is on the other side of the table. It is not a prelude to termination in most cases, because termination is the outcome the supply chain organization is trying hardest to avoid. Requalifying a source on a flight critical detail means finding a shop with the right process approvals and capacity, running first article inspection, updating the approved source list, and absorbing schedule risk on a program where late deliveries carry consequences that dwarf your entire receivable. The assurance demand is the mechanism by which that organization gets internal authority to help you, and the file it opens is the file in which somebody has to decide whether helping is cheaper than replacing.

So answer it, in writing, inside the window, with something a procurement director can take to a review board: a current thirteen week cash forecast, the specific plan for the funded debt including who is negotiating it, confirmation of raw material coverage for the next release, and a named commitment on the next three delivery dates. Then, in the same conversation and not a separate one, make your commercial ask. Accelerated payment terms, a prepayment against future releases, a raw material buy on the customer’s paper, purchase of the tagged inventory already built to their part numbers, or an economic price adjustment applied prospectively are all things primes do routinely, and all of them are cheaper for the customer than a source change.

Two things are worth guarding against on the way through that exchange. Anything you write in that response is a document your funder’s counsel may eventually read, so the numbers in it must match the numbers in your settlement file, and overstating your position to keep a customer calm is how an ordinary workout becomes a fraud allegation. And if you say nothing at all, §2.610 gives the aggrieved party its options on anticipatory repudiation, including suspending its own performance and resorting to remedies for breach, which in practice means the purchase orders stop and the receivable your funder is counting on stops with them.

6. Government Property on Your Floor Belongs to Somebody Else

If any part of your work reaches a defense program, there is a reasonable chance that some of what sits in your shop is not yours and never was. FAR 52.245-1(e)(1) provides that the Government retains title to all government furnished property, and that title to government property is not affected by its incorporation into or attachment to any property not owned by the Government, nor does that property become a fixture or lose its identity as personal property by being attached to real property. Under FAR 52.232-16(d), where a contract carries progress payments, title vests in the Government in parts, materials, inventories, work in process, special tooling and special test equipment, and in nondurable tools, jigs, dies, fixtures, molds, patterns, gauges and similar manufacturing aids allocable to that contract.

The clause reaches down the chain rather than stopping at the prime. FAR 52.245-1(b)(3) requires the contractor to include the requirements of the clause in all subcontracts under which government property is acquired or furnished for subcontract performance, which is how a tier three finishing shop that has never seen a contracting officer ends up holding accountable property. The consequence for a creditor is straightforward and worth stating to that creditor early: a sheriff executing on a judgment, a receiver taking possession, or a secured party conducting a §9.610 sale reaches only your own rights in the collateral, and your rights in property titled to the United States are custodial. A borrowing base or an appraisal that counted that tooling was overstated from the day it was written.

That protection is conditional on discipline you may have let slip while you were busy surviving. FAR 52.245-1(f)(1)(viii)(B) says that unless otherwise authorized, the contractor shall not commingle government material with material not owned by the Government, and (f)(1)(iii)(A) requires property records enabling a complete, current, auditable record of all transactions. Paragraph (c)(1) limits use of the property to performing that contract and (c)(3) forbids cannibalizing it without approval. Commingled, unmarked, unrecorded government material is exactly the material a levying officer scoops up and a bankruptcy trustee later has to litigate about, and the cost of that fight lands on you.

There is a second edge to the same clause set that suppliers do not see coming. FAR 52.232-16(c) lets the contracting officer reduce or suspend progress payments or increase the liquidation rate on substantial evidence of, among other things, performance endangered by the contractor’s unsatisfactory financial condition under (c)(2)(ii), or delinquency in paying the costs of performing the contract in the ordinary course of business under (c)(4). Your distress is itself a contractual trigger on the government side, which means the cash you were counting on to fund a settlement can be reduced precisely because you needed a settlement. Sequence the conversations accordingly, with counsel, before anyone outside your building learns the order in which you stopped paying people.

7. ITAR Decides Who Is Allowed to Buy You

A distressed sale is often the cleanest resolution available, and export control is what determines whether the buyer you found can actually close. Under 22 C.F.R. §122.1(a), any person who engages in the United States in the business of manufacturing defense articles must register with the Directorate of Defense Trade Controls, and the section is explicit that a manufacturer who never exports anything must nevertheless register, and that a single occasion of manufacturing a defense article is enough to require it. Section 122.1(c) is equally explicit that registration confers no export rights and is merely a precondition to any license. The annual fee under §122.3(a) starts at $3,000 for Tier 1 and $4,000 for Tier 2, with Tier 3 calculated at $4,000 plus $1,100 for each favorable determination beyond five.

The change of control rules are where a rescue timeline goes to die. Section 122.4(a) requires written notification signed by a senior officer within five days of a change in the registrant’s name, address, legal organization structure, ownership or control, board of directors, senior officers, partners or owners. Section 122.4(b) is the one that reshapes a deal: a registrant must notify DDTC by registered mail at least 60 days in advance of any intended sale or transfer to a foreign person of ownership or control, and the notice exists so the Department can consider whether section 38(g)(6) of the Arms Export Control Act should be invoked. Section 122.4(c) then requires the surviving entity after a merger or acquisition to identify which registration number survives and to list every license on which unshipped balances will move, warning that any license not the subject of the notification will be considered invalid.

Read that from a buyer’s underwriting desk. A domestic strategic buyer with its own registration can close on an ordinary timeline and absorb the five day notice as housekeeping. A fund with foreign limited partners, a foreign parent, or foreign persons on the board is looking at a 60 day advance notice, a certification under §122.2(b)(2) explaining the ownership or control and naming the foreign persons behind it, and the real possibility of a separate CFIUS conversation. Cash on a distressed timeline is worth a great deal, and the buyers with the most flexible cash are frequently the buyers who cannot move on your calendar. None of that is an obstacle to argue around, and the only useful response is to start the process eight weeks earlier than you wanted to and to qualify buyers on their control structure before you qualify them on price.

Stack that on the certification problem from the first item and the picture gets sharper for everyone in the room. A buyer of your assets is acquiring equipment, a customer list, an ITAR notification obligation and a re-approval project, because §21.144 and §145.57(b) mean the approvals do not ride along with the bill of sale. That is why aerospace suppliers are far more often rescued through a recapitalization, a customer funded bridge or a negotiated settlement that leaves the operating entity intact than through a clean asset sale, and it is why a settlement that keeps the entity certified is usually worth more to every creditor in the stack than a foreclosure that does not.

8. Your Receivable Is a Purchase Order With Chargebacks Attached

The invoice a funder advanced against is not money. It is a claim under a purchase order issued beneath a long term agreement that contains warranty terms, quality provisions, a right to reject nonconforming articles and, on most aerospace paper, an express setoff right. Tex. Bus. & Com. Code §9.404(a) puts the assignee in that position rather than above it, providing that unless the account debtor has made an enforceable agreement not to assert defenses, the assignee’s rights are subject to all terms of the agreement between the account debtor and the assignor, to any defense or claim in recoupment arising from the transaction that gave rise to the contract, and to any other defense or claim accruing before the account debtor receives an authenticated notification of the assignment. Subsection (b) then limits those other claims to reducing what is owed rather than creating affirmative recovery.

In aerospace that framework has teeth a general contractor receivable never has. A quality escape discovered eighteen months after delivery, a source inspection finding, a fallout charge on a heat treat lot, or the cost of a customer sorting a suspect batch all arrive as chargebacks against open invoices, and because they arise from the same supply agreement they read as recoupment rather than as unrelated setoff. Section 21.137(n) requires you to maintain procedures for identifying, analyzing and correcting quality escapes, and your customer’s procedures for pushing the cost of one back onto you are equally mature. A funder that underwrote your accounts as though they were fixed obligations of a large investment grade buyer underwrote something that does not exist.

The notification mechanics matter more than most owners realize. Under §9.406(a) the account debtor may discharge its obligation by paying you until it receives an authenticated notification that the amount has been assigned and that payment is to be made to the assignee, and §9.406(c) lets the account debtor keep paying you even after notification if the assignee does not seasonably furnish reasonable proof of the assignment on request. Section 9.406(d) makes contractual anti assignment terms ineffective as between you and your funder. In practice, an aerospace accounts payable department that receives conflicting directions from a factor and an advance funder freezes the payment and asks for an intercreditor agreement, which is how a supplier with adequate receivables still misses payroll.

Texas added a regulatory layer to that fight in 2026 that is worth knowing before it happens to you. 7 TAC §86.312(b)(12), adopted by the Finance Commission and effective July 9, 2026, makes it an unfair, deceptive or abusive act for a sales based financing provider to instruct a recipient or the recipient’s customer to redirect payments previously scheduled to another person, and the rule names a creditor or factor as the example. If a later position funder has been calling your prime’s accounts payable group to redirect remittances that already run to your factor, that conduct sits squarely inside the rule, and the enforcement route runs through the Office of Consumer Credit Commissioner rather than through a private suit.

What Texas Law Adds Once the Daily Debits Start

Texas regulated commercial sales based financing for the first time in 2025. H.B. 700 of the 89th Legislature created Tex. Fin. Code ch. 398, effective September 1, 2025, covering commercial sales based financing under $1,000,000, and three of its sections change how a Fort Worth supplier should read its own paperwork. Section 398.055 provides that a contract containing a confession of judgment provision or any similar provision is void and unenforceable, which is broader than it looks because it voids the contract and not merely the clause. Section 398.004 provides that a sales based financing transaction is not an account purchase transaction for purposes of §306.103 regardless of the principal amount, removing the safe harbor that has historically defeated recharacterization arguments in Texas.

Section 398.056 is the provision most commonly described wrongly, including on pages that should know better. It prohibits a provider or broker from establishing a mechanism for automatically debiting a recipient’s deposit account unless the provider holds a validly perfected security interest in the recipient’s account under Chapter 9 with first priority against all other persons. The word account is a defined term, and §9.102(a)(2) excludes deposit accounts from it. The Finance Commission resolved the ambiguity in 7 TAC §86.313(c), effective July 9, 2026, which reads the requirement as a first priority interest in all of the recipient’s accounts receivable, perfected by UCC-1 filing under §9.310(a) with priority under §9.322(a)(1). The practical effect for a stacked supplier is significant: a third or fourth position funder debiting your account daily almost certainly does not hold what the statute requires.

Temper that with what the chapter withholds. Section 398.102 says the chapter creates no private right of action, so a violation is not a lawsuit you file. Section 398.101 sets a $10,000 civil penalty per violation and 7 TAC §86.321(c) sets the administrative penalty at $1,000 per day capped at $10,000 per violation, with §86.321(b)(2) permitting an injunction that orders restitution to an identifiable person, which is the closest thing to a merchant remedy the chapter contains. Chapter 398 is also prospective, so paper signed before September 1, 2025 is governed by the older framework, where the confession of judgment question runs through Tex. R. Civ. P. 314 and its requirement of an appearance in open court and a creditor’s sworn statement. No Texas appellate decision construes §398.004, §398.055 or §398.056 yet, so treat any argument on them as argument on fresh text rather than as settled law, and read our Texas MCA default page for how those clocks run once a funder accelerates.

The Guaranty You Signed, and What Texas Leaves Standing

Nearly every advance in this industry carries a personal guaranty, and the guaranty is usually what keeps an owner awake rather than the corporate balance. Texas is one of the strongest states in the country to be a guarantor in, and the reason is the homestead. Tex. Prop. Code §41.001(a) exempts the homestead from seizure for the claims of creditors except for encumbrances properly fixed under §41.001(b), a closed list that runs to purchase money, taxes, properly contracted improvements, owelty of partition, certain refinances, home equity extensions meeting Art. XVI §50(a)(6), and qualifying reverse mortgages. A judgment on a business guaranty appears nowhere on that list, and the exemption carries no dollar cap at all.

The acreage rather than the value defines the limit. Section 41.002(a) allows an urban homestead of up to 10 acres in one or more contiguous lots with improvements, and it expressly contemplates property used both as an urban home and as a place to exercise a calling or business. Rural homesteads run to 200 acres for a family and 100 for a single adult under §41.002(b), and §41.003 preserves homestead character through temporary renting so long as no other homestead has been acquired. Section 41.001(c) protects the proceeds of a homestead sale from seizure for six months. Outside the homestead, Tex. Prop. Code §42.001 caps exempt personal property at $100,000 of fair market value for a family and $50,000 for a single adult, both exclusive of liens.

Two limits keep this from being a plan. Converting business cash into homestead equity on the eve of a judgment invites a voidable transfer claim, and in bankruptcy 11 U.S.C. §522(p) caps the homestead interest acquired within the 1,215 days before filing at $214,000, a figure adjusted April 1, 2025 and next adjusted April 1, 2028. The other limit is arithmetic: a strong homestead protects the house, not the company, and a supplier whose aggregate noncontingent liquidated secured and unsecured debts run under $3,424,000 may have a Subchapter V reorganization available under 11 U.S.C. §101(51D), which is a different conversation than a settlement. Take advice from counsel before moving a dollar, and see how the trade off looks against a Texas consolidation loan before you sign new paper.

Who Should You Call? Our Top-Rated Business Debt Firms

One firm on this list works the entire lifecycle of a business debt file, from stopping the daily debits through attorney-led negotiation, UCC lien removal, and a signed release. The other two cover broader debt categories that often sit alongside the advances. Choose accordingly.