Chapter 11 bankruptcy is used by businesses that believe they can pay off their debts by restructuring themselves. After speaking with an experienced Chapter 11 attorney, business owners know that they can remain in business and retain assets as they develop and execute their debt repayment plans. A court-appointed trustee supervises the business to ensure it complies with reorganization guidelines.
Most people think of Chapter 11 as a process for reorganizing a business. Individuals whose income, assets or debt exceed the limits of a Chapter 13 bankruptcy may also file Chapter 11. Our lawyers can review your case and determine whether filing Chapter 11 bankruptcy is an option in you.
In a Chapter 11 bankruptcy, the debtor initially has an exclusive opportunity to file a debt restructuring plan. The plan must be accepted by creditors and approved by the court. Under certain circumstances creditors may be permitted to file their own plan. Disputes over competing plans can complicate and delay a Chapter 11 bankruptcy proceeding. Our firm can represent you in filing bankruptcy as well as in any litigation that may develop during the process.
Immediately after a Chapter 11 bankruptcy case has been filed, an automatic stay prevents creditors from taking collection actions against the Debtor and its property, including judgments, lawsuits and garnishments. The debtor does not have to pay most pre-petition debt, including taxes, during this time.
Chapter 11 allows the debtor to retain assets and allows businesses to continue to function during the reorganization period. It can result in a significant reduction in debt and a chance for a fresh financial start.