Many businesses have suffered during the recession. In some instances, businesses have had trouble paying their creditors including lenders and vendors. As the amount of unpaid bills mount, there will be pressure by creditors to pay. Eventually, a business that does not have enough cash to pay all creditors will need to consider filing for a Business Bankruptcy in Chicago. There are a number of reasons why it may be best to file for a business bankruptcy.
First of all, it may be possible for the business to stay alive after a bankruptcy. With a chapter 11 bankruptcy, the debts of the company will be reduced by the bankruptcy trustee in order to enable the company to continue operations. Although creditors will not get payment in full, they will get a partial payment as ordered by the trustee. This option is also good for the employees who would be able to maintain their employment. Paychecks would be continued to be paid as well. However, it is very important for business owners to have a viable financial plan to keep the company running in the future after the chapter 11 filing. If the trustee does not feel the company can survive, the chapter 11 filing may not be granted.
The other option for a business bankruptcy is a chapter 7. Unfortunately, this will lead to the dissolution of the company. Employees will no longer have jobs. This is the best option when there is no way for the company to survive. The trustee will start the process of selling all remaining assets of the company. The proceeds will go to pay creditors, vendors, and employees. In many instances, creditors will only receive a partial payment. Creditors may have to suffer steep losses after the bankruptcy.
To begin the process of filing for a business bankruptcy, company owners should talk to a good business bankruptcy lawyer to figure out if filing bankruptcy is the right decision to make. The lawyer will help the company owner decide what type of bankruptcy will be filed. Once the decision to file has been made, the attorney will begin the long and complex process to file for bankruptcy protection. visit the Chicago Debt Solutions for more details. You can like them on Facebook.
