Who Can File for Chapter 11 Bankruptcy?
Chapter 11 is typically reserved for businesses that meet certain debt limits. The current debt limit for Chapter 13 debt is $1,081,400 for secured debt, and $360,475 for unsecured debt. If you do not fall under those qualifications, you will not be able to file for bankruptcy under Chapter 11.
Chapter 11 bankruptcies are normally filed by:
- Small businesses
- Corporations
- Partnerships
There are some individuals that can file under Chapter 11, but only if they have too much debt or income to qualify under Chapter 7 or Chapter 13 bankruptcies.
What Are the Benefits of Chapter 11?
Bankruptcies under Chapter 11 are noticeably distinct in comparison to bankruptcies of other chapters, and can offer several benefits.
Chapter 11 can provide a variety of advantages:
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Maintain possession of most property during filing instead of liquidating under other bankruptcies
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The ability to keep your business running to still make a profit while maintaining payments to your creditor(s).
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Automatic stay is put in place to immediately stop creditors from harassing you or trying to collect debts.
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You gain independence in reorganizing your debts to make for smaller payments each month.
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High-interest loans can be lowered
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Most debts are dischargeable
Unlike other forms of bankruptcy, Chapter 13 does not require you to actually liquidate your property, and give you a multitude of options to gain back your independence.
How Chapter 11 Works
Chapter 11 is the best way to file for bankruptcy while avoiding the liquidation of assets. Instead, it provides more time to extend payment plans and even divide payments into smaller and more manageable portions. There are instances in which companies can sell some of their assets to return payments, but this can also be done by restructuring the plan itself.
Contact Our California Bankruptcy Attorneys Today!
Our team has a deep understanding of the complexities of bankruptcy, and compassionately apply our skills to help you improve your financial situation. Filing for bankruptcy can be a daunting task, but you don’t have to do it alone. Our team has helped countless clients across Riverside, Victorville, and all over Southern California with their debts.
If you are looking into filing for bankruptcy and need sound guidance, get in touch with us by filling out a contact form on our website, or give us a call at 888-332-8362!
