Bankruptcy is a legal process used by businesses to discharge debts and restructure their financial situation. Companies can file either Chapter 7, Chapter 13, or Chapter 11 bankruptcy. Businesses will most often file for Chapter 13, which involves a reorganization plan that allows the company to keep assets and continue to make payments, but to also discharge debts through an auction or liquidation. In some cases, businesses will file for bankruptcy even before the debt has reached a point where it would be easy to liquidate.Learn more by visiting Chapter 13 Bankruptcy Attorney
Chapter seven bankruptcy is typically used by companies who have incurred too many debts, while chapter thirteen is for smaller companies who have a smaller amount of debt. A chapter eleven filing is when a company files for bankruptcy to reorganize itself and begin to get back on track. Business bankruptcy attorneys use a process called the ameliorative reorganization in order to help their clients avoid chapter eleven bankruptcy. This is not a type of bankruptcy that occur over time, but it does take place over a number of years. When a company files for chapter eleven, they will be looking for a way to clear their debts and begin to recover their business.
The process of filing for bankruptcy law will begin with a company seeking advice from an attorney. Once the company obtains the right advice, they will file a petition for bankruptcy. There are certain steps in the process that must be followed in order for the company to become eligible to file bankruptcy, including making sure that all of their accounts and credit reports are correct. In addition to bankruptcy law, lawyers will work to help other companies find their way out of trouble, helping them clear their debts and begin to get back on their feet. A business bankruptcy lawyer will help a business determine what their future will look like, how much money they have available to start again, and how to deal with creditors if they have to file bankruptcy. This is why a business should always seek professional help.