Chapter 11 Bankruptcy
What is a Chapter 11 Bankruptcy?
Chapter 11 is known as the reorganization chapter of the bankruptcy code because it permits a debtor to reorganize financial obligations while retaining assets, which may be accomplished through the sale of certain assets to pay down debt and refinance existing debts.
Both individuals and businesses can file a Chapter 11 bankruptcy. But, individual cannot file under chapter 11 or any other chapter if, during the preceding 180 days, a prior bankruptcy petition was dismissed due to the debtor’s willful failure to appear before the court or comply with orders of the court, or was voluntarily dismissed after creditors sought relief from the bankruptcy court to recover property upon which they hold liens.
In addition, no individual may be a debtor under chapter 11 or any chapter of the Bankruptcy Code unless he or she has, within 180 days before filing, received credit counseling from an approved credit counseling agency either in an individual or group briefing.
There are situations where the bankruptcy administrator determines that there are insufficient approved agencies to provide the required credit counseling debt management plan is developed during required counseling, it must be filed with the court.
The U.S. Trustee or Bankruptcy Administrator
The U.S. trustee plays a major role; monitoring the progress of a chapter 11 case and supervising its administration. The U.S. trustee is responsible for monitoring the debtor in possession’s operation of the business and the submission of operating reports and fees.
In addition, the U.S. trustee monitors applications for compensation and reimbursement by professionals, plans and disclosure statements filed with the court, and creditors’ committees.
The U.S. trustee conducts a meeting of the creditors, often referred to as the “section 341 meeting”. The U.S. trustee and creditors may question the debtor under oath at the section 341 meeting concerning the debtor’s acts, conduct, property, and the administration of the case.
The Automatic Stay
All judgments, collection activities, foreclosures, and repossessions of property are suspended for a period of time and may not be pursued by the creditors on any debt or claim that arose before the filing of the bankruptcy petition.
A stay of creditor actions against the chapter 11 debtor automatically goes into effect when the bankruptcy petition is filed. During this time negotiations can take place to try to resolve the debtor’s financial situation.
No other bankruptcy lawyer in Riverside or the High Desert area can offer you that same level of judicial experience and success as Todd Turoci, Turoci Bankruptcy Firm, has to offer. Experience that will help you save time, money and stress.
You can file for bankruptcy in person or over the phone. Either way there is no difference regarding service. More people prefer ‘bankruptcy by phone’ over ‘in-person’.