The COVID-19 pandemic has not only claimed lives, but it's also claimed livelihoods. Many businesses and individuals are on the verge of bankruptcy.
Financial experts have been predicting a "tsunami" of bankruptcy filings, but thanks to government aid in the form of stimulus checks, loans to businesses, and moratoriums on evictions, the big tidal wave has been rolling in slower than anticipated.
Lamar Hawkins, an attorney with Guidant Law tells ABC15, right now he is seeing many small businesses filing for bankruptcy.
Enough to keep him at work for 12-14 hours a day and Hawkins predicted a wave of individual filings would be next.
One of his clients was motel owner Robert McDowell. McDowell owns the Canyon's End Motel in Meadview, Arizona.
The town is located at the edge of the Grand Canyon by Lake Mead.
"This place was doing okay. It is in a fantastic location," said McDowell, stating he had purchased it as an investment, with the goal of turning around the motel to become profitable and eventually reselling it someday.
McDowell and his wife had fallen in love with the scenic area and wonderful people in the community.
"We doubled the business here. We had people from 39 countries stay here from all over the world because we're right where the Grand Canyon ends so they're coming to see the Sky Walk in the Hualapai Nation," said McDowell.
The motel had been booked out for nine months in advance at the beginning of the year, but on March 15, 2020, the world as they knew it came to a standstill.
"Unfortunately, President Trump had to restrict flights from Europe and other parts of the world, and it was like turning off a fire hose. Everything just stopped cold," said McDowell.
The Hualapai Nation closed off their roads to visitors and businesses shut down because of the COVID-19 pandemic. Governor Doug Ducey then shut down the Grand Canyon.
McDowell said the pandemic brought uncertainty and made him feel helpless as there was nothing he could do.
"Nobody wants to file bankruptcy unless they have to. It is really the last resort for anybody," said McDowell.
"Bankruptcy was the last resort. There is all kinds of embarrassment and stigma that go with that," he added.
McDowell decided to file because he says, it was the only way he knew to save his motel.
Thanks to a new law that passed in 2020, he was able to take advantage of Subchapter 5.
The law has been a life raft for small businesses trying to stay afloat. It is a way to pay back your creditors over time, rather than giving up your assets immediately.
You can learn more about Subchapter 5 by clicking here.