Whether you are a business owner with significant debts or you are struggling to keep your business open, it is important to hire a skilled Business Bankruptcy Attorney in Phoenix AZ. They can assist you in understanding the process of filing for bankruptcy, negotiating with creditors and assisting you with creating a reorganization plan that will give you the financial relief you need.
Often times, businesses face periods of downturn in sales and profits that make it difficult for them to continue operating. During these tough times, it may seem as though the only solution to your debt problems is bankruptcy. However, it is not always the right choice for every business.
In many situations, a business owner can still save their company without filing for bankruptcy. They can use alternative methods of debt restructuring and out-of-court settlements to avoid filing for bankruptcy altogether.
Some businesses can also restructure their debts without filing for bankruptcy by reducing the number of payments made to creditors. This can be a good option for some debtors who have low monthly income and little assets.
A skilled Business Bankruptcy Attorney in Phoenix will help you evaluate the situation you are in and recommend whether a bankruptcy filing is necessary. They will also help you determine what type of bankruptcy is right for your business and what steps to take to protect your rights and interests in the process.
Chapter 7 Cases
In a Chapter 7 bankruptcy, the court liquidates all non-exempt assets that belong to the debtor. The assets are then used to pay unsecured creditors, including tax bills and utility bills. In addition to these unsecured debts, a Chapter 7 trustee may also sell other assets to repay secured lenders.
During the bankruptcy process, creditors may come to court to ask questions or to file a claim against you. During this process, it is important to be honest and answer all the questions they ask under oath.
Sole Proprietorships, Limited Liability Companies and Corporations can generally keep their assets and operate their businesses after filing for bankruptcy. They can use legal exemptions under state law and bankruptcy laws to protect their assets.
When a business files for bankruptcy, the business will begin by filing a petition and schedules. These will detail all the debts, assets, income and expenses of the business.
The business will then attend a First Meeting of Creditors (also known as a 341 meeting). This is an opportunity for the business to discuss its finances with creditors.
In most cases, a plan of reorganization will be filed in the bankruptcy proceeding. This plan will outline a plan to pay off the creditors in a manner that makes sense for the business and allows it to continue operating.
Our experienced Bankruptcy and Creditors’ Rights attorneys have extensive experience in both Chapter 7 and Chapter 11 bankruptcies, as well as cross-border insolvency issues under Chapter 15. They have worked with numerous clients to successfully resolve their cases.