Bankruptcy For Small Businesses And Individuals
Chapter 11 bankruptcy offers debt relief to corporations and individuals with complicated financial situations. It is most similar to Chapter 13 in that it offers a solution for businesses to stay open and maintain ownership while they restructure their debts, and also provides a plan on how to pay back debt.
Chapter 11 also works for individuals on rare occasions with a plan for profitability after bankruptcy. New York business owners filing a petition of bankruptcy can keep creditors from collecting as you restructure and seek new sources of income. A debtor or creditor can file for Chapter 11. Once the filing is made in U.S. Bankruptcy Court, all collection processes are legally halted. The debtor continues to operate uninterrupted, but they must formulate a plan to repay creditors.
At the Law Office of John Gonzalez, P.C., we can help you determine what is the right type of bankruptcy for you, and we also serve businesses looking for debt relief under Chapter 11. An attorney who focuses on bankruptcy, Mr. Gonzalez understands firsthand what his clients are going through, and he has a depth of knowledge that comes after 20 years of bankruptcy work in Medford, Syosset and Hauppauge. Every case is unique, but it is extremely likely that he has experience with your particular bankruptcy needs.
The Reorganization Plan
We can assist in formulating a plan for a business to become profitable. This can be done using the following strategies over the course of 180 days:
Renegotiating a lease for the workspace
Renegotiating contracts with suppliers or services
Negotiating debts to be discharged or partially paid
The filer must report to the court each month, keeping it apprized of their progress in executing the plan. If it is determined the company or individual will not become profitable, a Chapter 11 will be converted to a Chapter 7 by the courts. If this is the case, assets and goods are liquidated in a "fire sale" to raise income.
As with other types of bankruptcy, creditors are prioritized. The order is as follows:
Top priority: Federal and state taxes, employees owed wages and stockholder interests.
Secured creditors: Those who provided credit in the form of tangible assets.
Unsecured creditors: These include credit card companies and unspecified loans.
A Bankruptcy Lawyer Can Help
Once the plan has been executed and the debts have been paid off to the satisfaction of the bankruptcy court, the bankruptcy will be discharged. Some think that best option is to simply file for Chapter 7 and start over, but a bankruptcy attorney can be crucial in determining the best course of action for you.
Contact John Gonzalez With Chapter 11 Questions
Call 631-346-6253 to speak with Mr. Gonzalez. You can also reach us through our contact page.
We are a debt relief agency. We help people file for bankruptcy relief under the Bankruptcy Code.