If you are a business, corporation or an individual in Williamson County, Cedar Park or Round Rock suffering financial hardship, and you need relief from debt with re-organization under Chapter 11, you should contact an attorney who understands bankruptcy law and who is able to guide you through the process. The Jackson Law Firm is ready to assist you in successfully navigating your bankruptcy case no matter how complex.
The are four types of Bankruptcy that can be filed under the law. Each differs slightly:
Chapter 11 Bankruptcy can be a relief from heavy financial losses which are heavy burdens. It can also offer a reorganization and recovery by corporations, business partnerships and sometimes individuals if they have major debt and Chapter 7 or 13 was not an option for them. Most cases of bankruptcy are not the result of reckless spending or mismanagement but by financial hardship, or business fluctuation and other losses from which a business, corporation or an individual is unable to recover by themselves.
When a business or corporation is in financial trouble they usually don’t have any other options but to liquidate their assets or file for Chapter 11 Bankruptcy, which will keep them in business and secure them from ruin. Some businesses fail and file Chapter 7 which provides immediate relief from creditor collections and harassment. In this case, a trustee is appointed by the court to liquidate all of the business assets in order to pay creditors. In the case of Chapter 7 for Limited Liability Companies (LLC) and corporations, no debt is discharged.
Chapter 11 does not absolve businesses or individuals from their responsibilities such as paying employee wages or paying income taxes, and the court will supervise the business operations while the business is undergoing the process of bankruptcy. Individuals who file Chapter 7 can convert it into Chapter 11 in some cases, which will allow them to keep their property. The entire process may be time-consuming depending on the financial assets and restructuring plan.
If you are a business, LLC or corporation, bankruptcy reorganization can offer downsizing of excessive or unprofitable locations of your brand, renegotiate terms with the IRS and reduce the amount of unsecured debt, though each bankruptcy case is individual and unique and each case with different details and elements involved. The Jackson Law Firm are experts who understand that bankruptcy can be a challenging and confusing process, and will regard your case in a professional and serious manner.
The steps taken to file Chapter 11 begin before you file your petition with the court.
11 U.S.C. §§ 109, 111 states that no one may file any chapter of the Bankruptcy Code unless they have received credit counseling within 180 days before filing with the court.
Then the petition can be filed. The language of the document declares the reason for filing, lists the assets in the case, a list of creditors who are owed, and the plan of reorganization of the petitioner’s business, corporation or partnership. Once the petition is filed with the court, the court issues a “Stay” which means all creditors are informed of the bankruptcy filing and they must cease any and all legal action, including garnishments against the petitioner.
The amount of time from filing the petition to finalizing the bankruptcy can only be determined by the financial and property assets included in each individual case. Complicated cases have been known to last as long as three years or more.
Although the petitioner has the right, for a period of time, to determine the nature of the reorganization plan, a creditor may also have the right to submit their own plan that would be beneficial to their interests and their plan of action will also be examined by the court. Their plan must list the entire debt owed to them in detail and how they would be able to settle the debt more effectively in their favor rather than liquidating. There may be more than one creditor and there is no limit to the number of creditors who may present their own plan.
Although bankruptcy cannot cure all financial issues, some of the relief from filing bankruptcy is a great benefit for the individual, business or corporation such as it can eliminate some rights of creditors to seize a mortgage or other property or put a lien on property as collateral for the debt owed. It can protect co-signers on your debts such as when a relative has co-signed on a loan for you, and the consumer discharges the loan in bankruptcy and it discharges debts that arise after bankruptcy has been filed.
There are fees to file for bankruptcy, both for the petition and miscellaneous administrative fees. These are usually the same for each state but some states may differ in miscellaneous fees. The average cost to file your case with the court is $1,167 per case and approximately $550 in miscellaneous administrative fees. The fees are usually paid to the clerk upon filing but may be paid by installments if given permission by the court.
If you are considering filing for bankruptcy, call the law offices of the Jackson Family Law Firm today. We serve all of Williamson County, including Cedar Park and Round Rock. And we are waiting to serve your needs.
