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Bankruptcy

Chapter 11 bankruptcy is usually only filed by businesses

Chapter 11 bankruptcy is similar to Chapter 13 bankruptcy in that it involves reorganizing and restructuring debts. However, it is not a personal type of debt and in fact is usually only filed by businesses. This type of bankruptcy is also fairly expensive and difficult to file for, so you should only consider it if you are running a business that you do not want to lose.

Chapter 11 bankruptcy will allow you to stay in business even after you file bankruptcy. This is why it is usually filed by other businesses. However, you should keep in mind that some of your profits will have to go toward paying off your debts each month. Also, after you file for bankruptcy, your business will be overseen by a bankruptcy court in order to make sure that your debts are being paid off properly.

If you have a small business debt – for instance, less than two million dollars, then you will not need to go through all of the bankruptcy proceedings that are required for a much larger debt. Instead, you can request a fast track process that will allow you to get through the bankruptcy proceedings quicker and back in business.

However, some thing that you should keep in mind is that there are still some disadvantages to filing for fast track. Basically, you will not have as much time as you would otherwise in order to pay off your business debts. This can be a disadvantage, but considering that you have a much smaller debt than most other businesses, you should be able to pay off all of your debts during the time allotted.

Another thing that is a part of Chapter 11 bankruptcy is called the automatic stay. Basically what this means is that for a short period of time after the bankruptcy is filed, none of the creditors are allowed to ask for money from the debtor. During this time, it is possible for the debtor to put his or her assets in order and get set up in order to be able to pay off any outstanding debts. This stay starts as soon as Chapter 11 is filed. Keep in mind, however, that the stay can be lifted on some debts.