Chapter 11’s Are Meant for Struggling Businesses
Video Transcribed: Oklahoma Bankruptcy Attorney Edward Kelley here, answering your bankruptcy questions with oklahomacitybankruptcyattorney.pro. So I’m still sheltered in, so I get to do this, I’m going to take advantage. Okay so, I enjoyed doing all the chapters series, so I’m going to extend that out a little bit and do three, three part series covering the major points in each chapter.
So I’m going to start this one with chapter 11, and we’re going to talk about who can qualify. So this is meant for a business, that’s the purpose of a chapter 11, and it’s meant for a business that has a chance for success. So, unfortunately if you have a business that simply isn’t going to see any daylight, you are going to go to tremendous expense and trouble for a chapter 11 that probably ultimately won’t succeed.
As I’ve mentioned in the previous videos, the trustee and the creditors have a uniquely powerful position in this bankruptcy and the idea is to keep your business alive and the idea behind it is that by staying in operation, ultimately those creditors will get more than they would get if you just folded, so it’s a symbiotic, mutual advantage by necessity.
So you’re going to have to be able to convince those creditors and the trustee in order to get anything approved that by staying afloat you’re going to do better than you would have. So this is the idea and this is where a chapter 11 can benefit you. So how do you gauge that, are you a good candidate? Well, do you have accounts receivables out there?
What assets could you litigate? How could you trim the fat from your business, so to speak. You’re going to get a lot of advice and help and although that can be annoying, that can be a great thing. Where can you streamline your operations?
Do you have a product or service that if it’s not in demand now, will be back in demand? Do you have relationships that can be salvaged with your creditors? So again, it’s like anything else, if something’s a lost cause maybe it’s just time to let it go.
But if you can look at your books, at your assets, at the black and red and you can see a way out that’s rational and reasonable, chapter 11 will give you the power of the automatic stay to do it, which I’ll talk about in the next video. So that’s who should do a chapter 11, number one in a series of three. As always you can reach me at 1-888-debtline, firstname.lastname@example.org, or on Facebook at Oklahoman’s for Debt Relief. Talk to you soon.