Deciding to file for Chapter 11 is not an easy decision to make. If you find that you or your company may need to file for Chapter 11 bankruptcy, you should seek an attorney that has the expertise and experience to give you the best advice on what you should do. Here are some tips on why you would need a long island Chapter 11 attorney and if you may be eligible to file.
Are you eligible?
Chapter 11 can be filed by both businesses and individuals. Businesses can file if they have a partnership, corporation, LLC or any other legally filed business entity. However, trusts are not eligible under Chapter 11 bankruptcy laws. If you are an individual and are considering filing for Chapter 11, it does not matter if you have a sole proprietorship business or if you work for someone else.
When should you file for Chapter 11?
There are three basic reasons to file for Chapter 11. If you are an individual that has a sole proprietorship and need to reorganize your business, Chapter 11 will allow you to get your business back on track while you can continue to operate your business without legal interruption. Another reason for filing Chapter 11 is for liquidation purposes. Liquidation under Chapter 11 allows the debtor to control their assets in satisfying creditors as opposed to a court-appointed trustee under Chapter 7 liquidation law. The third main reason is that some individuals simply are not eligible for Chapters 7 or 13 bankruptcies due to a high income to high debt ratio, so Chapter 11 is their only choice.
How can Chapter 11 help your situation?
Chapter 11 bankruptcy is the most flexible of all chapters. It does not appoint a trustee to oversee the case. The debtor is completely “in possession” of their own estate. Chapter 11 can help the debtor get short-term relief from debt payments, lower interest rates, and restructure payment terms. A large amount of debt can be discharged among many other Chapter 11 benefits to help an individual get back on their financial feet.
If you are in a dire financial situation and don’t know where to turn, Chapter 11 can be a great option, but you have to be prepared and understand how it works. It will be a great feeling once you have control over your finances. The above is just some general information on helping you make a decision on whether or not you want to contact an attorney to help you with a Chapter 11 case. While Chapter 11 bankruptcy may not be right for everyone in a dire financial situation, it is worth exploring the option. If you think you may need assistance, contact a Chapter 11 attorney for more information and advice on what you should do. Chapter 11 should not be taken lightly. It is a commitment and should only happen after careful consideration along with a consultation with an experienced and knowledgeable Chapter 11 bankruptcy attorney.