Bankruptcy can happen to anyone, and that includes small businesses. Businesses can be put into financial distress for reasons out of their control. These types of events can lead to bankruptcy. Luckily, our bankruptcy law firm can help in these situations. Let's learn more about how our bankruptcy law firm can help you when your small business is in trouble.

Help You Understand Different Types of Bankruptcy

In our experience, when it comes to filing for bankruptcy as a business, there are a few options available. The first option you can choose is Chapter 7, which is a liquidation that will require your business to give over most of its assets to a trustee. They will use these assets to pay off creditors as much as possible. Any remaining debt is discharged and in this case, the business would cease to exist. If this isn't clear, we're happy to explain this more!

Another option would be a Chapter 11 proceeding. This allows for the business to stay in operation during the bankruptcy and reorganization. Our experts indicate that the business would need to proceed with a court-approved plan for creditors. A sub-chapter V proceeding is a scaled-down version of Chapter 11. This is made for businesses that can't obtain a normal reorganization process. This is often used if the debt is less than $7.5 million and the business would be able to pay off most of its debts in three to five years under the court-approved plan, according to the Department of Justice. Payment plans are allowed through U.S. courts for certain types of bankruptcy. We would be happy to review this with you more in-depth!

Explain How Bankruptcy Can Help

Although many people view filing for bankruptcy as a tragedy, it can also be a helpful solution to get out of dire financial hardships. In our experience, once you file, creditors must stop collection efforts. This can also mean there's the possibility of avoiding foreclosure on commercial property. Most businesses can continue normal operations as well under a Subchapter V proceeding. You'll need the help of a bankruptcy law firm like us for this process. There is no avenue to file these proceedings on your own. We're happy to explain every step of the way. We also know that there are many different versions of bankruptcy. For example, according to the U.S. Courts, when you file for Chapter 13 bankruptcy, you can make payments over 60 months to repay your debts or have them discharged.

These are just a few facts to get you started. If you have more questions or you need bankruptcy assistance, please contact Cox Law Group, PLLC today. We are a reputable bankruptcy law firm that is here for your bankruptcy needs.