Chapter 11 bankruptcy: what to know

This form of bankruptcy involves the reorganization of a debtor’s business affairs, debts, and assets. Named after the U.S. bankruptcy code 11, corporations and partnerships generally file Chapter 11 if they require time to restructure their debts.

Chapter 11 debtors usually propose a plan of reorganization to keep their business alive and pay creditors over time. People in business or individuals can also seek relief under chapter 11.