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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 bankruptcy option is available to corporate or business debtors, so individual consumers cannot use this option to get rid of their personal debts. There is one major requirement that a firm must satisfy to qualify for this option; they must have a reliable source of income that can be utilized in servicing the reorganized debt.
While the default type of bankruptcy calls for liquidation of assets owned by the firm to offset their debts, this option provides for reorganization of debts. The debtor is declared bankrupt, and gets all bankruptcy protections. In return, they agree to make monthly payments to the trustee, who distributes the payments to all the creditors. This goes on throughout the bankruptcy period, after which all unpaid debts are written off.
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.
A trustee is normally appointed by the court when a bankruptcy petition is received. The work of the trustee is to carry out due diligence and ensure the law is followed to the letter throughout the bankruptcy process. The trustee also acts as the intermediary between creditors and the debtor.
It is important to note that there are many types of debts that cannot be written off through bankruptcy. Taxes, penalties and interest on unpaid taxes are not subject to bankruptcy proceedings, so you still have to pay off your taxes when you are declared bankrupt. Only death can absolve you from paying taxes.
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 is only an option of last resort, so you should never rush to seek bankruptcy protections. This is because there are many downsides of becoming bankrupt. For one, your business will not be able to access credit facilities from mainstream lenders throughout the bankruptcy period. Secondly, your bankruptcy status will be made public, and this may affect your business prospects as most investors and suppliers do not want to work with bankrupt individuals. Therefore, you should consider other options before declaring bankruptcy.
This bankruptcy option is available to corporate or business debtors, so individual consumers cannot use this option to get rid of their personal debts. There is one major requirement that a firm must satisfy to qualify for this option; they must have a reliable source of income that can be utilized in servicing the reorganized debt.
While the default type of bankruptcy calls for liquidation of assets owned by the firm to offset their debts, this option provides for reorganization of debts. The debtor is declared bankrupt, and gets all bankruptcy protections. In return, they agree to make monthly payments to the trustee, who distributes the payments to all the creditors. This goes on throughout the bankruptcy period, after which all unpaid debts are written off.
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.
A trustee is normally appointed by the court when a bankruptcy petition is received. The work of the trustee is to carry out due diligence and ensure the law is followed to the letter throughout the bankruptcy process. The trustee also acts as the intermediary between creditors and the debtor.
It is important to note that there are many types of debts that cannot be written off through bankruptcy. Taxes, penalties and interest on unpaid taxes are not subject to bankruptcy proceedings, so you still have to pay off your taxes when you are declared bankrupt. Only death can absolve you from paying taxes.
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 is only an option of last resort, so you should never rush to seek bankruptcy protections. This is because there are many downsides of becoming bankrupt. For one, your business will not be able to access credit facilities from mainstream lenders throughout the bankruptcy period. Secondly, your bankruptcy status will be made public, and this may affect your business prospects as most investors and suppliers do not want to work with bankrupt individuals. Therefore, you should consider other options before declaring bankruptcy.
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.
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