It’s not uncommon for businesses to run into financial trouble from time to time. However, often times those financial problems can lead to bankruptcy. Bankruptcy is usually the final move to help keep a business afloat. If you’re the owner of a business and you’re considering bankruptcy, you’ll have a couple of options to choose from.
Your first option will likely be Chapter 7 bankruptcy, which is the most common choice by most smaller businesses. This option will allow you to practically eliminate all eligible debt. Unfortunately, this kind of bankruptcy help doesn’t come free. Not only will you have to pay for filing and administration fees, but you’ll also have to liquidate some of your property in order to pay your creditors.
There are plenty of other Business Bankruptcy options to choose from. Not every business will qualify for Chapter 7 bankruptcy. If you don’t qualify, you could always choose Chapter 13 bankruptcy instead. Filing for Chapter 13 bankruptcy is one of the best ways to restructure your debt and keep your business open. However, there are certain requirements you must meet. For instance, this option is for businesses owned by individuals and not corporations. Also, if you have too much debt, you won’t be able to file for Chapter 13 bankruptcy.
If you have too much debt and you want to keep your business afloat, you’ll need to consider filing for Chapter 11 bankruptcy. This option is typically for those big businesses that are owned by limited liability companies and corporations. Filing for Chapter 11 bankruptcy is very expensive and risky; you won’t be able to completely eliminate your debt. Businesses will only be allowed to work with their creditors in order to restructure the debt that they now owe.
These are just a few of the Business Bankruptcy options that are available. Again, Chapter 7 bankruptcy is the most common and most affordable option for businesses. Your next option will be Chapter 13 bankruptcy, which will allow you to restructure your debt and get your business back on track. If you’ve accumulated an obscene amount of debt over the years, your only option might be Chapter 11 bankruptcy. Speak with a lawyer to figure out which option would be best for your business.
