Chapter 11 Bankruptcy Can Benefit Businesses And Individuals
Chapter 11 is a form of debt reorganization used by businesses to allow them to keep operating under a debt repayment plan. It is also an effective bankruptcy tool for individuals who have more than $1.08 million in secured debt and $330,000 in unsecured debt and do not qualify for Chapter 13.
Usually corporations are the ones that file for Chapter 11, but small businesses might file for it as well. Individuals might also file for Chapter 11 in limited circumstances.
Advantages of Chapter 11 Bankruptcy Reorganization
Although the Chapter 11 process can take more time and cost more money than Chapter 7 and Chapter 13 bankruptcy, there are advantages that come with it.
For example, debtors are provided more time to create a plan to pay back their debts and to reorganize their businesses. In most cases, the primary purpose of Chapter 11 is to aid businesses to reorganize and trim costs in such a way that they can become more profitable and financially stable following bankruptcy.
Either the debtor business or creditors of that business can file for Chapter 11. When creditors file, it’s known as an involuntary Chapter 11 petition. After it has been filed, an automatic stay will go into effect. This ceases all debt collection activities on the part of creditors.
The debtor will then create a business and debt reorganization plan. The debtor will also negotiate more realistic payback terms with creditors.
After filing the petition, the business will continue operations uninterrupted. With the assistance of the bankruptcy court, the debtor will also create a debt repayment plan. Repayment amounts will usually be less than the original amount of the debt.
Numerous businesses throughout the nation have saved their bottom line — and the future viability of their operations — via Chapter 11 bankruptcy proceedings. Could your business benefit from Chapter 11 bankruptcy? We will help you find out.
Experienced Chapter 11 Attorneys
Unlike attorneys who advise on Chapter 7 and Chapter 13 consumer bankruptcy, fewer lawyers have experience with Chapter 11 reorganization or understand how to use it to their client’s advantage. At The Law Offices of Ronald I. Chorches, our Hartford, CT, Chapter 11 bankruptcy lawyers have helped scores of individuals and businesses create a workable payment plan under Chapter 11 and eliminate much of their unsecured debt or financing.
When you contact us, we help you prepare a plan of action and prepare you for court appearances at the U.S. Trustee’s Office. Our goal is to get you or your business back on its feet, eliminate as much debt as possible and devise a plan that allows you to make payments that work within your budget.
Get Your Bankruptcy Questions Answered
For a free, confidential consultation on how Chapter 11 bankruptcy can benefit businesses and individuals, please contact us online or call The Law Offices of Ronald I. Chorches at 860-952-3878.