When considering bankruptcy, it is important to consult with professionals who are familiar with business law and Orange County complex bankruptcy disputes. Filing for bankruptcy as a business, lender, or investor can be quite different from filing as an individual.
It is important to understand your options to pick the type of bankruptcy that is most effective for you and your assets. To obtain more information on bankruptcy, contact an Orange County bankruptcy litigation attorney today.
The attorneys at Scheer Law Group, LLP, have decades of experience working with a variety of businesses and creditors. From bankruptcy to real estate and property litigation, Scheer Law Group, LLP, has handled many different types of cases for businesses large and small. We have represented clients in both state and federal courts and have helped them maintain as many assets as possible during bankruptcy proceedings.
One of the most important things to determine before filing any kind of bankruptcy proceeding is whether or not it is the most relevant option for your situation. Here are some important things to learn about beforehand:
Talking with a bankruptcy creditor attorney can help educate you on whether or not filing for bankruptcy is the right option for you. They might also know about additional options available to you that can help you avoid bankruptcy.
Some types of bankruptcy require an attorney to assist in the process. Outside of this, however, attorneys are incredibly helpful in the process and can do things like:
The most common forms of bankruptcy are Chapter 7, Chapter 11, and Chapter 13 bankruptcy. The correct type of bankruptcy for you depends on your specific situation.
Chapter 7 bankruptcy is most commonly filed by individuals who are interested in removing all of their debts while remaining housed and employed. Small businesses will sometimes file Chapter 7, but this usually results in them ceasing operation and selling the businesses’ property to its creditors. These types of small business owners are unable to afford a repayment plan.
If a business is interested in staying open after their bankruptcy filing, a Chapter 11 bankruptcy might help them do that. In this type of bankruptcy, business owners negotiate with creditors on restructuring current debt to make it easier for them to repay it while maintaining operations.
In most cases, businesses are not eligible to file for Chapter 13 bankruptcy. A sole proprietor or investor might find this type of bankruptcy more useful because they have the opportunity to restructure both their business debts and personal debts at the same time.
If a business is run by a partnership, it is usually not recommended to file for bankruptcy. In many partnership agreements, if one individual in the partnership applies for bankruptcy, the entire business is dissolved.
The following is a general outline of how a bankruptcy procedure can go. If you have a complicated bankruptcy case, the process might look a bit different, but most of the steps are similar.
In Chapter 7 and Chapter 13 bankruptcy, a debtor must consult with their creditors in a meeting along with their trustee. This meeting is held to make sure the statements you made in your petition are accurate. They will also verify your identity to prevent bankruptcy fraud.
For most debtors, the meeting is quite brief and might only take several minutes. The meeting will also be attended by your bankruptcy trustee and any creditors who want to know additional information about the petition.
In normal circumstances, most creditors do not attend the meeting unless they have a personal reason to do so. If a creditor needs additional time for questions or evaluation, the meeting will usually be rescheduled. If your meeting is successful, you will likely receive a discharge order stating that your debts are relieved.
A reorganization plan is usually created by a business filing for Chapter 11 bankruptcy in an attempt to keep the business open while attempting to pay all of its debts. It typically includes:
Under normal circumstances, a debtor usually has 120 days after filing a bankruptcy petition to submit a reorganization plan. In some cases, extensions may be granted. If the debtor has prepared the plan ahead of time, they are allowed to submit it at the same time as they file for Chapter 11 bankruptcy. After this period has passed, a creditor can submit their own plan, and the court can decide which plan is more appropriate.
After the court decides which plan to review, any creditor who will not be completely repaid due to the agreement must vote to approve or reject the plan. Once one group of creditors accepts the plan, it can be officially reviewed by the court. If the court decides that the plan is reasonable and acceptable for both the debtor and its creditors, it is approved.
If the reorganization plan is successful, then the business can carry on as usual while making payments to its creditors as outlined in the plan. If it is unsuccessful, the bankruptcy trustee can dismiss the case, resulting in the debtor having to file another one. They can also move the Chapter 11 bankruptcy to a Chapter 7 bankruptcy. In this case, a debtor’s assets are unprotected and will most likely be liquidated.
Most people and businesses filing for bankruptcy simply want to erase their debts and refresh their financial status. If you’re concerned about accusations of fraud, however, there are some things you can do to prevent them from happening:
Most fraudulent acts committed during a bankruptcy proceeding are made on accident and are fixed with revisions instead of fraud charges. To prevent anxiety and stress regarding mistakes in a bankruptcy petition, consult a bankruptcy attorney to make sure the paperwork is done right.
A: Chapter 11 bankruptcy can be one of the most complicated types of bankruptcy due to the company attempting to reorganize its assets. These bankruptcies often include many different debtors and creditors to help lower a company’s debts.
Usually, Chapter 11 bankruptcy is only available for businesses, but certain individuals might qualify for it as well. To learn more about your bankruptcy options, contact a bankruptcy attorney.
A: Before filing for bankruptcy in Orange County, it is important to consider all your options. If you decide that bankruptcy is the most effective solution, the next step is determining what type of bankruptcy to file.
These cases are handled on a federal level, so you do not submit any forms to the county; instead, you file forms with the federal government. For additional assistance with filing bankruptcy, contact a California bankruptcy attorney.
A: Most bankruptcy filings in the US are either Chapter 7 or Chapter 13 bankruptcies. While Chapter 7 bankruptcies are often the cheapest, they are usually only available to individuals who make below the median income based on the state they live in.
Chapter 13 bankruptcies are often a bit more complicated and usually require a lawyer to complete the process. To learn more about which type of bankruptcy may be right for you, consider working with an attorney.
A: The length of time for a bankruptcy proceeding largely depends on the type of bankruptcy filed and the assets being evaluated. Less complicated bankruptcies can take four to six months, while more complicated ones can take over a year. Longer bankruptcies usually involve some kind of litigation due to a variety of issues. A bankruptcy attorney can help you evaluate how long your bankruptcy case might take.
It is extremely important to file for bankruptcy correctly the first time. The experienced attorneys at Scheer Law Group, LLP, can help with many stages of the bankruptcy process and help protect your personal and business interests. Schedule a consultation with us today to learn about whether bankruptcy is right for you.
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