Chapter 11 Elk Grove Business Bankruptcy Lawyer & Business Bankruptcy Law Firm

What is a Chapter 11 Business Bankruptcy? Who would file a Chapter 11 bankruptcy in Elk Grove?

A bankruptcy case filed under Chapter 11 of the U.S. Bankruptcy Code will generally be filed by an Elk Grove area business, although this chapter is also available to individuals. While a business may choose to file a Chapter 7 bankruptcy (liquidation), it may not file a Chapter 13 bankruptcy (reorganization) because these are reserved for individuals. But it is very common for a business to want to reorganize its debts and stay in business rather than filing a Chapter 7 and liquidating all of its assets. Chapter 11 bankruptcies are available to Sacramento County businesses for this purpose (i.e., staying in business and restructuring the company's debts). Whether you are a small business or a large business, debt can beome overriding.

There are some famous Chapter 11 bankruptcy cases filed by some high profile companies: Lehman Brothers in 2008 (during the Wall Street collapse); Washington Mutual Bank which was quickly acquired by Chase Bank; and the Enron bankruptcy which brought to light unlawful accounting practices. It doesn't take unlawful accounting practices to get a business, even a small business, into trouble ... the current economy combined with poor bookkeeping and/or lack of financial planning can cause problems and conceal a looming financial crisis for Elk Grove businesses.

A business does not have to be completely insolvent before it is allowed to file a Chapter 11 bankruptcy case. Accountants and bookkeepers in the Elk Grove, Sacramento County, California, area can provide invaluable financial support to businesses and provide guidance of when it might be time to seek the advice of a qualified Elk Grove Chapter 11 bankruptcy attorney. Some Elk Grove area financial professionals include:

The main reason an individual or married couple would want to file a Ch. 11 bankruptcy instead of a Ch. 13 case is because their debts may exceed the limits allowed in chapter 13 bankruptcy cases. Although similar to ch.13, an Elk Grove Chapter 11 bankruptcy is much more complicated and requires the advice of a qualified Elk Grove Bankruptcy Attorney.

Common types of creditors in Elk Grove, California, with whom a person may have very high debts that disqualify them filing a chapter 13 bankruptcy:

Banks and Mortgage Companies such as Jpmorgan Chase Bank, National Association (9610 Bruceville Road, Elk Grove, CA 95757) and Wells Fargo Bank, National Association (5120 Laguna Boulevard, Elk Grove, CA 95758).

Car Dealers such as Elk Grove Buick Pontiac GMC (8450 Laguna Grove Drive, Elk Grove, CA 95757) and Maita's Elk Grove Chevrolet (9131 Elkmont Way, Elk Grove, CA 95758).

Jewelry Stores such as Folsom Fine Jewelry (632 E Bidwell Street, Folsom, CA 95630) and Kwan's Fine Jewelry (4005 Manzanita Avenue Suite 5, Carmichael, CA 95608).

The Basics of a Chapter 11 Elk Grove Bankruptcy:

A qualified Elk Grove Bankruptcy Law Firm will have the expertise to guide their clients through the Chapter 11 bankruptcy process. Here are the common steps for Chapter 11 cases filed in Elk Grove and Sacramento County, California (but they may vary depending on specific circumstances):

► The case begins when the petition is filed with the bankruptcy court. Sacramento County cases are filed with the California Eastern Bankruptcy Court located in the 501 I Street, Suite 3-200, Sacramento, CA 95814.

► The filing fee of $1,000 and administrative fee of $39 are paid.

► Upon filing of the petition and pursuant to Section 1107 of the bankruptcy code, the debtor assumes the responsibilities normally assigned to a trustee (as in a Chapter 7 or Chapter 11 case) and is known as "debtor in possession." This means the debtor may continue to operate the business, including paying employees.

► The debtor in possession also has the responsibility of filing monthly operating reports with the Court and the U.S. Trustee, filing and paying taxes, and creating a plan for reorganization.

► Although the debtor is given the authority to continue to operate the business in the ordinary course of business, the debtor is expected to do so in a manner in the best interest of all concerned. The interest of the creditors is protected by the formation of various creditor committees. These committees will have much influence on the reorganization plan being developed by the debtor in possession.

► A plan is proposed, a confirmation hearing is held, and eventually a plan will be confirmed.

► The plan is implemented.

► Confirmation of the plan can also mean discharge of debts incurred prior to confirmation, but there are many variables including whether the debtor is an individual or a business. Your Elk Grove Bankruptcy Attorney will advise you on the effects of confirmation of your plan.

Contact an Elk Grove Bankruptcy Attorney for advice and consultation about filing a Ch. 11 Sacramento County Bankruptcy.

Serving clients throughout Central California, including Antioch, Auburn, Brentwood, Citrus Heights, Concord, Davis, Dixon, Elk Grove, Fairfield, Folsom, Galt, Lincoln, Lodi, Manteca, Modesto, North Highlands, Parkway, Pittsburg, Placerville, Rancho Cordova, Rio Vista, Rocklin, Sacramento, South Lake Tahoe, Stockton, Vacaville, Vallejo, Winters, Woodland, Yuba City, areas in the vicinity of Sacramento Mather Airport, and other communities in Sacramento County.