Personal Bankruptcy vs. Business Bankruptcy in Chicago IL
Chapter 11 bankruptcy can rescue a sound business that is going through a rough patch. Chapter 11 can also prolong the pain and leave you personally liable for debts of a doomed enterprise.
Atlas Consumer Law has enabled many businesses to successfully weather the storm through bankruptcy. Yet we believe that the majority of Chapter 11 business reorganizations should have been filed as personal Chapter 7 bankruptcies. We often represent clients after they have been talked into expending tens of thousands of dollars on a futile Chapter 11 plan.
Our knowledgeable attorneys practice exclusively in bankruptcy and foreclosure. We can analyze your financial and your business prospects to determine whether to seek a Chapter 11 reprieve from creditors or whether to liquidate the business and move on.
Contact us online or call our Lombard law office at (312) 313-1613 to speak with an experienced Chicago bankruptcy attorney.
Chapter 11 Reorganization vs. Chapter 7 Personal Bankruptcy
We get countless inquiries from small-business owners about keeping a business afloat through Chapter 11 bankruptcy. Only a rigorous study of your full financial picture can influence the decision of whether or not to file a Chapter 11.
There are two key questions among the many considerations. What is the value of the business and what is the personal exposure if the Chapter 11 doesn't pan out? For most small-business owners, they are the business and the entity has little value other than limited receivables. The best move may be to fold a troubled business through Chapter 7 and walk away. You can start a new business.
Brad and Angelina* own a medical practice in Elmhurst, Illinois. They owe $400,000 in equipment loans, plus Brad is the personal guarantor for $200,000 in unsecured loans. They also carry $80,000 in credit card debt incurred to keep the business afloat. Through a Chapter 7 liquidation, they discharge both the business and personal debts. The trustee seizes assets of the dissolved business, but they keep their house and all personal assets.
We Help You Weigh Business vs. Personal Bankruptcy
When people are stressed about debt or financial straits - and remember that is a relative term - they limit their spending, which has trickle-down effect throughout the economy. The Bankruptcy Code is meant to help you move on, not to hold you back and punish you for business debts. That was the intent of Congress, to have people move forward and to spend again, invest again and rejoin the consumer economy.
*Brad and Angelina are fictitious characters created to illustrate bankruptcy scenarios.
Talk to our experienced bankruptcy lawyers about the pros and cons of Chapter 11 bankruptcy or a personal Chapter 7 filing. Contact Atlas Consumer Law online or call (312) 313-1613 to arrange a consultation.