There are many bankruptcy chapters that individual consumers, businesses, charities and other legal entities can use to get rid of their debts. This legal provision has been provided under the federal bankruptcy act, but state law also has some provisions that guide the entire process. If you have been weighed down by debt, you can use bankruptcy to get a fresh start. The key to success, however, lies in hiring a chapter 11 Oakland lawyer.
This type of bankruptcy is available to businesses and legal entities that have a lot of bad debt. Individual consumers cannot use it to get rid of their debts. There is one important condition that a business must satisfy to qualify. A business must have a stable income source that can be used to pay off the debts.
Liquidation is the default type of bankruptcy. It calls for selling of all the assets owned by the business to pay off debts. The downside with this option is that it prevents the business from continuing with operations, so they may have to close shop. With debt restructuring, debts are restructured to allow for monthly payments throughout the bankruptcy period.
The main advantage of this chapter is that it makes it possible for business owners to retain ownership over their business assets. In business, liquidation translates to shutting down of business operations. It is also much more confidential than liquidation.
After filing the necessary paperwork in court, a bankruptcy trustee will be appointed. This is the person who will be in charge of the entire bankruptcy process. They will carry out due diligence on the financial position of the debtor to confirm that they meet all the minimum requirements for this option. If the debtor has a lot of valuable assets and an unreliable income, the trustee may recommend liquidation as opposed to restructuring of debts.
There are some business debts that cannot be written off no matter what. Taxes, for instance, must be paid together with penalties, fines and interest on overdue taxes. Therefore, you should keep this in mind when filing for bankruptcy. After all, a large fraction of your debt may comprise taxes, fines and penalties as well as interest on the same.
The main benefit of a chapter 11 bankruptcy is that it allows businesses or legal entities to restructure their debts. Once the trustee has been appointed, the firm will be required to come up with a payment plan that they can honor with their average monthly income. This means that the business will continue to operate and retain all personnel as they service their debts.
Bankruptcy should only be considered after other options for dealing with debt, such as refinancing and debt consolidation, have failed. This is because bankruptcy comes with a number of unwanted effects. For instance, the debtor will be blacklisted by lenders as the bankruptcy entry will appear on their credit report. This will make it hard for the business to access credit facilities or any type of financing. Secondly, the business may not be able to get some tenders or jobs that require qualified firms that are not bankrupt.
This type of bankruptcy is available to businesses and legal entities that have a lot of bad debt. Individual consumers cannot use it to get rid of their debts. There is one important condition that a business must satisfy to qualify. A business must have a stable income source that can be used to pay off the debts.
Liquidation is the default type of bankruptcy. It calls for selling of all the assets owned by the business to pay off debts. The downside with this option is that it prevents the business from continuing with operations, so they may have to close shop. With debt restructuring, debts are restructured to allow for monthly payments throughout the bankruptcy period.
The main advantage of this chapter is that it makes it possible for business owners to retain ownership over their business assets. In business, liquidation translates to shutting down of business operations. It is also much more confidential than liquidation.
After filing the necessary paperwork in court, a bankruptcy trustee will be appointed. This is the person who will be in charge of the entire bankruptcy process. They will carry out due diligence on the financial position of the debtor to confirm that they meet all the minimum requirements for this option. If the debtor has a lot of valuable assets and an unreliable income, the trustee may recommend liquidation as opposed to restructuring of debts.
There are some business debts that cannot be written off no matter what. Taxes, for instance, must be paid together with penalties, fines and interest on overdue taxes. Therefore, you should keep this in mind when filing for bankruptcy. After all, a large fraction of your debt may comprise taxes, fines and penalties as well as interest on the same.
The main benefit of a chapter 11 bankruptcy is that it allows businesses or legal entities to restructure their debts. Once the trustee has been appointed, the firm will be required to come up with a payment plan that they can honor with their average monthly income. This means that the business will continue to operate and retain all personnel as they service their debts.
Bankruptcy should only be considered after other options for dealing with debt, such as refinancing and debt consolidation, have failed. This is because bankruptcy comes with a number of unwanted effects. For instance, the debtor will be blacklisted by lenders as the bankruptcy entry will appear on their credit report. This will make it hard for the business to access credit facilities or any type of financing. Secondly, the business may not be able to get some tenders or jobs that require qualified firms that are not bankrupt.
About the Author:
Find an overview of the benefits of consulting a Chapter 11 Oakland attorney and more info about an experienced lawyer at http://www.centralcoastbankruptcy.com/chapter-11.html right now.
No comments:
Post a Comment