Chapter 11 Bankruptcy Attorneys in Middlesex County, New Jersey
In New Jersey, businesses — including corporations and partnerships going through financial hardship — may be eligible to seek debt relief through Chapter 11 bankruptcy. Essentially, filing for protection under Chapter 11 can give you sufficient time to restructure your business affairs and settle your debts while staying in business. If you're considering filing for Chapter 11 bankruptcy, reaching out to a knowledgeable New Jersey bankruptcy attorney is imperative for clear legal direction.
At Schwartz, Hanna, Olsen, & Taus, P.C., we enjoy giving comprehensive and experienced legal counsel to clients in business bankruptcy-related matters. Our seasoned legal team can analyze your specific financial situation and determine whether you can restructure your business under Chapter 11. In addition, we will help file your bankruptcy petition and represent you diligently in every phase of the legal proceedings.
If you're located in the New Jersey areas of Middlesex, Morris, Somerset, Essex, Bergen, and Passaic Counties, or anywhere else in the state, contact Schwartz, Hanna, Olsen, & Taus, P.C. today to schedule a free consultation.
What is Chapter 11 Bankruptcy?
Chapter 11 bankruptcy – also referred to as "reorganization" bankruptcy – is designed to give businesses facing financial distress or overwhelmed with debts the adequate time they need to restructure their business assets, affairs, and debt obligations while keeping the company afloat.
In a Chapter 11 case, the debtor (business owner or partnerships) will propose a structured repayment plan to repay the outstanding debts to the creditors – using potential revenue – without stopping their business operations.
Essentially, both the creditor and the court must approve the plan, and it must be in the creditor's best interests. However, filing for protection under Chapter 11 is expensive and time-consuming.
Additionally, Chapter 11 bankruptcy works best with partnerships and corporations. Regardless, you may be eligible to seek protection under Chapter 11 bankruptcy if:
You need time to reorganize business affairs, finances, and debts.
Your unsecured debt or secured debt is more than the limits of a Chapter 13 bankruptcy filing.
A knowledgeable lawyer can guide you through the legal processes involved in filing for Chapter 11 bankruptcy and help you navigate crucial decisions.
The Process of Filing
Here are the steps involved in filing for protection under Chapter 11 of the U.S. Bankruptcy Code:
File a Petition: Hire an attorney to help file your Chapter 11 petition. The petition should include your disclosure statement – the business's financial statements, debts, assets, outstanding leases, and contracts.
Automatic Stay: Upon filing your petition, an automatic stay order will go into effect. This will bar creditors from seeking debts or taking further legal action against you or your business.
Create a Reorganization Plan: Create a reorganization plan outlining how you intend to restructure business operations and reduce overhead costs. Any profit generated going forward will be used to offset your debts. Both the creditor and court must approve the reorganization plan.
Attend a Hearing: Attend the confirmation hearing where the court will decide whether to approve the restructuring plan. Once confirmed by the court, the plan will become effective, and the debtor must execute it. You will receive a discharge at the end of your plan.
A seasoned Chapter 11 bankruptcy attorney can help simplify the entire bankruptcy process and ensure that you make intelligent financial decisions moving forward.
What is a "Debtor in Possession?"
A "debtor in possession" can be described as the debtor in a Chapter 11 case without a court-appointed trustee. As such, the debtor in possession (the debtor) will have the duties, responsibilities, rights, and obligations of the trustee. Hence, they must adhere to the rules and provisions of Chapter 11, as well as other bankruptcy court orders.
Furthermore, in a Chapter 11 case, a creditor committee may be established comprising at least three (3) unsecured creditors. The aim of the creditor committee is to represent the best interests of all other unsecured creditors.
The disclosure statement is a legal document containing detailed information about the debtor's assets, finances, debts, liability, and business affairs. The creditor will review the disclosure statement in order to make an informed decision about the restructuring plan proposed by the debtor.
When is Chapter 11 a Good Option?
Furthermore, Chapter 11 may be an ideal option if:
You run a large corporation or business establishment.
You have more debt to reorganize than permissible under Chapter 13 "debt limits."
You want to keep your company afloat while restructuring your business affairs, finances, and debts.
Get Help from a Trusted Bankruptcy Attorney
Filing for Chapter 11 bankruptcy in New Jersey usually involves several complicated processes. Determining your eligibility, filing your bankruptcy petition, attending court proceedings, and settling creditor disputes can make the whole procedure exhausting. Therefore, getting knowledgeable guidance from a reliable bankruptcy attorney is crucial to help you navigate tough decisions and avoid costly errors.
With over 80 years of combined experience, our attorneys at Schwartz, Hanna, Olsen, & Taus, P.C., have the resources and skills to advise and guide businesses in the legal matters of bankruptcy. As your lawyer, we will assess the financial condition of your business and determine whether you qualify for Chapter 11. Also, we will help with your filings, represent you in court, and help negotiate a feasible restructuring plan with your creditors.
Chapter 11 Bankruptcy Attorneys Serving Middlesex County, New Jersey
If you need proper guidance filing Chapter 11 bankruptcy, call us at Schwartz, Hanna, Olsen, & Taus, P.C. today to learn about your options. Our wise team has the personalized legal guidance and skill you need to navigate intelligent decisions in your business bankruptcy. If you're located in the New Jersey areas of Middlesex, Somerset, Morris, Passaic, Essex, and Bergen Counties, or anywhere else in the state, contact our law firm today.