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Chapter 11 bankruptcy is meant for a business that is having a hard time financially. It allows them to reorganize their debt. If this sounds like something you’re interested in exploring, call our Clearwater Chapter 11 bankruptcy lawyers today.
You start the process by filing your petition. This petition for bankruptcy gets filed with the court. This decision to file is entirely up to you. You get to make a wise choice to file or not to see what it can do for you.
Chapter 11 is really meant for a bigger business such as a corporation. However, people can file for Chapter 11 if their income or debt is too high to file for Chapter 7 or 13 bankruptcy.
Our Clearwater Chapter 11 bankruptcy lawyers are here to help you better understand this. Sometimes the timeline for a Chapter 11 can be as quick as six months. In other cases, it can take up to two years to wrap up.
You will get a chance to come up with a plan to reorganize your debts for four months. If this plan is a good one and the court agrees it is a good one, you will be able to independently manage these decisions to deal with your debt for up to 18 months. If the circumstances are not ideal, the court can shorten this exclusivity period.
After this time period ends, anyone who has credited you money can look at reorganizing your debt. If they cannot agree, your bankruptcy may become Chapter 7. That is fairly rare, however. Chapter 11 exists to let you reorganize your finances. It’s basically a contract between you and those who lend you money that helps rework how your debt gets paid back down the road. You may be required to downsize or liquidate some assets.
It is pretty rare that Chapter 11 would make you pay all of your debt right away. Your creditors are allowed to vote on if they agree about what your Chapter 11 will entail. This is all something you can discuss with our Clearwater Chapter 11 bankruptcy lawyers.
Your plan has to be approved. This part of the process is going to be called confirmation. Much like you’d review an online purchase before proceeding, your plan has to be reviewed before it’s confirmed. In order to be able to have your Chapter 11 bankruptcy plan confirmed, the bankruptcy court will be looking at:
How Feasible the Plan Is
The bankruptcy court is going to be looking at the feasibility of the plan. They’re looking at how well thought out the plan is and how well it’s laid out. You have to be able to prove that it will work by showing that you can get the money in a reasonable amount of time to be able to pay for the plan and pay the creditors.
The plan that you make has to be legal and in good faith. The court will be looking into whether or not this plan is in good faith. Then you may proceed.
Does the Plan Benefit Creditors?
There are several factors that go into whether or not this plan will be good for the creditors. If the plan is in the best interests of the creditors then the bankruptcy court will be able to confirm the plan. The way to figure this out is to put the plan through a test to see how much it will benefit the creditors in a reasonable manner. Sometimes the test has you pay back the credits in the total amount in which you are indebted to them. That’s certainly not always the case though.
A lot of people in your shoes are really in a lot of money trouble and end up having to only pay back a portion of the debt. The plan still has to be fair no matter how it turns out. There is something called secured credit which has to be paid back in the amount of the collateral. Our Clearwater Chapter 11 bankruptcy lawyers truly care about how this turns out for you.
We want to guide you through this. Be sure to call us right away. We know this is complicated but we can walk you through this step by step. It can go smoothly. We understand you’re in a tough spot where no one wants to be. We can help you get through this. Let us help make your future financially better.
If you have any questions about your decision to file for Chapter 11 bankruptcy or you need guidance through the process please give us a call right away. The future ahead of you can be bright. Contact our Clearwater chapter 11 bankruptcy lawyers today.