Is Chapter 11 bankruptcy only for businesses?
No, individuals may also be eligible to file Chapter 11 bankruptcy. However, other forms of bankruptcy, such as Chapter 7 or Chapter 13 may be better suited for individuals.
Is Chapter 11 the only type of bankruptcy allowed for businesses?
No, businesses may also file for Chapter 7 bankruptcy. However, businesses are not eligible to file for Chapter 13 bankruptcy protection.
What is Chapter 11 bankruptcy?
In Chapter 11 bankruptcy, a company negotiates with its creditors and stakeholders to develop a Chapter 11 plan. The Chapter 11 plan allows businesses to alter existing contracts and loan arrangements to reduce the amount owed and extend the repayment period.
Do you have to close the business when filing Chapter 11?
Chapter 11 provides businesses with the opportunity to restructure its debt and modify existing contracts. A business will not be required to close as a condition of Chapter 11 bankruptcy.