Watch this video to learn why a company files Chapter 11 bankruptcy in Georgia. Then call Hall & Navarro for a consultation.
Why do individuals or companies choose to file chapter 11 bankruptcies?
Many times, people ask us why a company would file a Chapter 11 bankruptcy in Georgia. There are basically two reasons to file a Chapter 11 bankruptcy. One is to obtain an orderly liquidation of assets, for instance, if the company is not profitable. It cannot be profitable, but yet, there needs to be an orderly liquidation of its assets. Then a Chapter 11 might work. The other reason and primary reason that we file Chapter 11s is that the business is truly profitable but just has a cash flow crunch such as might be the case for some businesses during COVID-19, if you haven’t been able to work your business like you normally do. Your sales have fallen down. You still have employee salaries that need to be paid, but yet, in the long term, the business can be profitable.
A Chapter 11 would give you a breathing spell. For instance, in a Chapter 11, you can have up to four and six months to actually file a plan to start repayment to your creditors. During this time the court allows you time to reorganize your debts, your assets, and your business so that it can have a profitable future. This gives your business a lifespan that it would not have otherwise because the creditors might foreclose and take your assets away. If you have any questions concerning filing of Chapter 11, we’ve done many Chapter 11s. We’d be happy to help you.
Are you or a loved one in the process of filing for bankruptcy in Statesboro, Springfield, or Swainsboro and have questions about why a company files Chapter 11 bankruptcy in Georgia? Contact the experienced Georgia bankruptcy attorneys at Hall & Navarro today for a consultation and case evaluation. We can help get your life back on track.