Businesses that reach a point of filing for bankruptcy can testify about the challenging circumstances that precede such a difficult decision. The federal bankruptcy code sets out the stipulations for bankruptcy filing for individuals struggling with debt.
Similarly, Chapter 11 Bankruptcy Millburn NJ, also sets out procedures for struggling businesses, offering such businesses a reprieve to reorganize and restructure their business debts. Noteworthy to point out that Chapter 11 has differences and similarities to Chapter 7 and Chapter 13 for a bankruptcy filing.
Suppose you are a business owner within the Millburn area. In that case, bankruptcy lawyers in Millburn NJ can advise you on the applicable differences in Chapter 11 bankruptcy laws before you file for bankruptcy. Goodgold West & Bennett LLC attorneys can guide business owners on the requisite process for a bankruptcy filing under Chapter 11. Read on about the eligibility for Chapter 11 bankruptcy, the procedure, and how to file for bankruptcy.
What is Chapter 11 Bankruptcy?
Chapter 11 bankruptcy is a “reorgan
ization” law that allows businesses to restructure debts and plan for debt payment arrangements while maintaining ownership of their businesses. Individuals can also qualify for Chapter 11 to process an orderly liquidation of assets.
Chapter 11 bankruptcy offers a better bargain for business owners to avoid severe alternatives of complete business closure and liquidation of assets. Business owners may apply to restructure their finances to save their businesses from total collapse if they do not qualify for a bankruptcy filing under Chapters 7 and 13.
All bankruptcy proceedings have non-dischargeable and dischargeable debts. Bankruptcy attorneys in Millburn NJ can advise you on how Chapter 11 can be applicable to reorganize mortgages and other liabilities where a debtor does not qualify for Chapter 7 and 13 bankruptcy filing.
Filing under Chapter 11 initiates an “automatic stay,” which halts the collection of debts until the formulation and confirmation of the repayment plan. Proceedings for filing under Chapter 11 are tedious, time- consuming and expensive.
Business owners intending to file should engage an experienced Millburn bankruptcy lawyer to discuss the rules and requirements to ensure a successful plan to repay their debts. Attorneys at Goodgold West & Bennett LLC Law Firm offer professional legal services and guidance to clients in Millburn, NJ, and surrounding locations.
Eligibility and Requirements for Filing for Chapter 11 in New Jersey
The “debtors in possession,” who are business owners, are the ones who file for Chapter 11. Occasionally, business creditors may file bankruptcy petitions when businesses can no longer cover their debts.
Individuals are also eligible for Chapter 11, although procedurally, it is cost-effective for individuals to pursue the bankruptcy process through Chapter 13.
Several requirements are necessary for businesses and individuals opting for Chapter 11 filing:
- Fees: The current cost for Chapter 11 is $1,720 for filing and other applicable miscellaneous fees.
- Credit Counseling: Similar to Chapters 7 and 13, a debtor in possession has to attend a credit counseling program within 180 days before filing for bankruptcy and show the developed repayment plan.
- Payment Plan: Debtors in possession have to show the plan for debt repayment or declare an intention for the same according to the rules under Chapter 11.
- Disclosure Statement: A disclosure statement is mandatory and needs filing with the court during the application process. The disclosure should indicate the businesses’ assets, liabilities, and proposed plans to allow the creditors to make an informed decision about the stated proposals.
The Disclosure Statement in Chapter 11 Bankruptcy Filing in NJ
A Millburn NJ Chapter 11 bankruptcy attorney can testify how crucial the disclosure statement is under Chapter 11. An inaccurate disclosure statement can result in a dismissed application. The disclosure statement should include:
- The business description
- Financial information of the business/individual
- The repayment plan
Other requirements for review under the submitted financial information include:
- Statements on insider transactions
- Analysis of the consequences of liquidating business assets
- Disclosure of all professional fees paid
- The applicable tax chargeable
Do you Need Help Filing for Chapter 11 Bankruptcy in NJ?
A Millburn bankruptcy attorney can assist you in filing for Chapter 11 bankruptcy and give your business a reprieve to avoid asset liquidation. Suppose you need legal services and advice within Millburn and the surrounding location.
In that case, it is essential that you speak to an experienced Millburn Chapter 11 bankruptcy lawyer to offer you the proper guidance and explain to you your options as a debtor in possession seeking bankruptcy under Chapter 11 of the bankruptcy code.
For all queries and guidance on filing for Chapter 11 bankruptcy, contact experienced bankruptcy attorneys in Millburn, NJ at Goodgold West & Bennett LLC or call us at 973-544-0800 to speak to one of our attorneys or to schedule an appointment.
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