Business Bankruptcy Laws
What is a business bankruptcy?The meaning of business bankruptcy is when a business cannot pay their own bills. What this means is that the money coming into the business is not enough to pay the creditors. Normally bankruptcy is confirmed when the business’s financial condition seems useless. When some business decide to wait a long times to file bankruptcy these business’s normally end up having many creditors disturb involuntary bankruptcy on this business. In many other cases, sometimes more than one creditors can try to disturb a lien on the possessions of which the business owner must pay, this can include taxes or even creditors also can be intimidating in order to require the owners to guarantee debts of an incorporated business.
What is the process in filing business bankruptcy?When deciding to file for business bankruptcy the individual will need to understand that there is more than one way to file. A chapter 7 will include a total liquidation of any possessions and closure of the business. In Chapters 11 and 13 this will allow a type of protection from the creditors and then allow them to repay any debts over a certain time period of which will include three to five years. In the Chapter 13 filing this filing can be used by sole proprietorship and partnership with a protected debt of less than $807,750 and any unprotected debts less than $269,250. After deciding what filing this person will be taking, they may need to consult an attorney to make sure that this is the right filing for them. When meeting with the attorney the person will need to provide the attorney with all their business finances, income, possessions and debts that way the attorney can file these legally with the bankruptcy court. In many cases after this the company will have been granted protection right away from the creditors and the court will contact all the creditors involved in the bankruptcy and then have a meeting with these creditors. When meeting with the creditors this will take place about a month after they have filed Chapter 7, and at this point in time they are expected to give up the nonexempt possessions to the selected trustee by the court. The person must keep in mind that they will need to turn in a statement on how they plan to repay or reorganize their business if they in fact have filed a Chapter 11 or 13. After filing the Chapter 7 the individual can possibly be released after a very few short months and they will be released from the debt.
In the state of Texas if someone has already filed a Chapter 11 can they change it to a Chapter 7? Now, if they are expecting a refund check can they wait to receive these funds and then apply this to their house legally?In the state of Texas and in this case the individual will not be allowed to change this. The reason for this is because they have already filed a bankruptcy chapter 11 and all the possessions are to be managed by the trustee. In this case a refund will be considered a possession. Now if they dismiss their Chapter 11, they can get their refund and then file a new Chapter 7 and the put the refund towards the home.
In the state of Texas if someone files a business bankruptcy under Chapter 7 or 11 can this stop foreclosure of a real estate?There are a few things to consider, if the business is a separate legal unit such as a corporation, Limited Liability Company, Limited Partnership, Limited Liability Partnership then the Chapter 11 is the only option they will have, this is because only individuals can file a Chapter 7. Now, if the business is a sole proprietorship, they can file a Chapter 7 and avoid the foreclosure for about 30 days. After the 30 days have passes, the lender will more than likely have the bankruptcy court to lift the stay, and that then would allow the foreclosure to carry on, regardless of the bankruptcy.
If someone has mainly business debts but then owes an individual $1,200 and they have repaid this person is it required to state this repayment on#10A of the Statement of Financial Affairs and also is it recoverable as a fraudulent transfer?In this case the loan payment is not required to be put anywhere n the Statement of Financial Affairs. This kind of repayment would not be considered a “fraudulent transfer”; this is the transfer of property without enough reimbursement. Repaying this loan is not a transfer of property without enough reimbursement.
When filing business bankruptcy the laws can often be very confusing, and a very long process. These different laws for business bankruptcy may not be known to someone where this is their first time. When different questions arise, this can leave a person scared and not knowing where to turn for help, the online Experts are available to assist and provide legal answers to the many different business bankruptcy law questions.