How A Chapter 11 Bankruptcy Attorney Can Protect Your Business Assets
A bankruptcy attorney can help you with much more than just bankruptcy filing. Consult with one to determine if there are less costly alternatives to bankruptcy open to you.
All too often, businesses and individuals let their financial
problems go on for too long, and wind up facing bankruptcy. Usually this
is a last resort solution to overwhelming financial burdens, but before
you get to that point there are other options you can pursue.
Consulting a qualified attorney is the best way to protect your assets
and secure your financial future - with or without resorting to
What Is Chapter 11?
Chapter 11 is the most frequently used form of bankruptcy protection for businesses. A filing provides protection from creditors and lawsuits while companies work out a debt repayment plan and/or business reorganization. It can be an expensive, time-consuming, risky and complex solution, which is why the decision to file for this type of protection should not be taken lightly, and should only be undertaken with guidance from a bankruptcy attorney.
Under these protections, the business will undergo a restructure, reorganization and/or develop a repayment plan under court supervision. The business itself is responsible for developing the recovery plan, which is presented to the creditors for approval. Even without creditor approval, the plan may be submitted to the court for approval. Once the business has recovered, a petition to close the Chapter 11 can be filed.
Benefits Of Chapter 11
The attraction of Chapter 11 filing is that it allows the business to remain in operation while the debt repayment or reorganization is underway. Finances can be restructured and credit obligations can be reduced or the payment terms modified to help the company regain profitability. In the meantime, assets are protected from creditors, and lawsuits are barred.
Alternatives To Bankruptcy
Bankruptcy is well-known as a solution to financial problems, but its not the only solution. The cost and complexities of filing mean it should be a last resort.
Some of the less well-known alternatives include: debt negotiation or debt litigation, asset sales, fiduciary alternative, and Section 363 alternative.
Debt Negotiation: Sometimes
mediation and negotiation can result in a favorable outcome for all
parties. The debtor may negotiate debt repayment with each individual
creditor or as a whole.
Each of these alternatives has advantages and disadvantages. A bankruptcy attorney will be able to review your situation and recommend a course of action that works for you.
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ABOUT THE AUTHOR
Latham, Shuker, Eden and Beaudine, LLP is a business and bankruptcy law firm that represents debtors or creditors in refinancings, debt restructurings, asset sales, workouts, and reorganizations. If you are in need of an Orlando bankruptcy attorney contact the firm at (407) 481-5800.