American Express is one of the most common creditors that we encounter when dealing with consumer credit cards, but they are also an enormous lender when it comes to business loans, lines of credit and credit cards. American Express credit cards are broken into two kinds, business credit cards and corporate credit cards. The difference primarily is that a business card is personally guaranteed by someone at the business while a corporate card lacks the personal guarantee. Corporate cards are usually given to larger businesses with larger annual revenues as well as larger total annual spending who they believe to be less of a risk. Obviously if a corporate card holder defaults on their debt, American Express can only enforce against the business whereas they can enforce against the personal guarantor in business card defaults. American Express prefers to have a personal guarantor for this reason. An LLC on a smaller level can easily be shut down or just left as defunct and American Express would have trouble collecting or enforcing on the debt if they did not have a personal guarantor to pursue. American Express business lines of credit and loans are not very different from their credit cards. Most require personal guarantors unless the larger company can show the requirements to keep the debt at the corporate level alone.
American Express doesn’t typically wait when a default occurs on their business debt loans and credit products. They are extremely aggressive and pursue collection immediately. If collection proves to be ineffective, then they pursue litigation. When they sue a business, they usually choose whether to keep it in house and have their internal attorneys at American Express Legal handle the lawsuit or they decide to send it to and outside law firm like: Doyle & Hoefs, Zwicker & Associates and or Relin, Goldstein and Crane who are the primary outside law firms that handle lawsuits for American Express. Business debt lawsuits tend to have a higher debt value and can easily exceed six figures or more. It is extremely important to avoid a default judgment for this reason alone given that a large debt can increase to an even larger amount in judgment due to standard judgment interest and fees involved. Submitting an answer with defenses against an American Express Business or Corporate lawsuit is the most important step in order to prevent a default judgment, to keep the burden on American Express to prove their case and to keep leverage on the side of the business debtor. If a default is obtained, then a motion to vacate the judgment or an Order to Show Cause must be filed immediately to re-open the case and prevent or remove any levies, liens, or garnishments.
In our experience, American Express has been willing to negotiate fair settlement terms to resolve business debt matters whether with American Express Legal or with the outside counsel mentioned above. We have been able to negotiate reductions between 30% - 65% off in these matters as well as obtaining interest-free repayment plans spanning 12-60 months or more depending on how high the debt amount is. The most important step is to work with an attorney who knows Amex as well as this niche field of business debt collection and can help defend against them as well as negotiate favorable and affordable payment terms for the business.