What Is Chapter 11 Bankruptcy and Why Do You Need to Know About It?
Many people know of Chapter 11 bankruptcy as the “business bankruptcy” — the type of bankruptcy used by businesses and organizations that can no longer manage their debts. And while this is true, there’s much more to this financial restructuring and reorganization than meets the eye.
So do you know as much as you probably should about Chapter 11 bankruptcy — especially when 8,980 of them were filed in 2013?
Here’s all the information you should know about Chapter 11 bankruptcy explained:
1. Chapter 11 bankruptcy helps businesses stay afloat: For businesses and companies that can’t make their debt payments, a Chapter 11 bankruptcy helps them create a reorganized debt repayment plant that both consolidates their debts and creates a repayment schedule that fits the business’ needs. This lets the business continue with its everyday practices and operations while getting out of debt.
2. How long does Chapter 11 bankruptcy last?: The length of a Chapter 11 bankruptcy varies from case to case — in more complicated filings, it can take as long as several years. However long your company’s bankruptcy repayment plan lasts, it’s important to stay committed to making your payments and staying on-track.
3. Individuals may sometimes file for Chapter 11 bankruptcy: It might seem impossible — Chapter 11 bankruptcy for individuals? But in fact, while the majority of individuals do tend to file Chapter 13 or Chapter 7 bankruptcy, some people can file a Chapter 11 bankruptcy in extenuating circumstances.
4. Chapter 11 bankruptcy is nearly impossible without an attorney: Companies should never file a Chapter 11 bankruptcy without the help of a qualified attorney who works exclusively with these types of bankruptcies. Because businesses’ bankruptcies are much more complex than individual bankruptcies, you’ll need to get all the bankruptcy help you can for your debt reorganization plan. Reference links.