Types of Business Bankruptcy
Just as individuals can come into financial difficulties and unsustainable debt situations, businesses may also overextend themselves to such a degree that they are no longer able to pay their creditors sufficiently to remain in business. The United States Bankruptcy Code offers outlets for businesses in such financial distress, and with the guidance of a skilled business bankruptcy attorney you may be able to successfully eliminate your business’s debts and return to solvency with a fresh slate.
At the Russell Van Beustring P.C., our legal team is dedicated to helping distressed businesses find workable solutions for their debt situations, and will work tirelessly to help ensure that your bankruptcy proceedings move forward smoothly and effectively. To learn more about how an experienced Houston bankruptcy attorney can help solve your debt problems, contact us at 713-973-6650.
Types of Bankruptcy
Businesses do not share the same rights as individuals with regards to bankruptcy law, but still have options for discharging or managing debt. The following are the two principal modes of bankruptcy available to businesses:
- Chapter 7 Liquidation: Businesses cannot actually file for Chapter 7, but in many sole proprietorships or limited partnerships in which an individual is responsible for the business debts of their company, that individual may file for Chapter 7 in order to liquidate their business holdings and discharge their debt. It is important to note that this will result in the termination of the business.
- Chapter 11 Restructuring: In a Chapter 11 bankruptcy, the business remains in operation while restructuring both its operations and the terms of its repayment agreements with creditors. This is conducted under the supervision and at the discretion of the bankruptcy court, and a business that successfully completes the requirements may emerge from bankruptcy, whereas a business that makes insufficient progress may be forced to convert the case to a Chapter 7 bankruptcy.
If your business has reached a point where you no longer see any way to effectively pay your debts, it may be time to consider filing for bankruptcy. If you would like to speak with a Houston business bankruptcy lawyer of the Russell Van Beustring P.C., contact us by calling 713-973-6650, today.