Chapter 11 Lowell Business Bankruptcy Lawyer & Business Bankruptcy Law Firm

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

A bankruptcy case filed under Chapter 11 of the U.S. Bankruptcy Code will generally be filed by a Lowell 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 Middlesex 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 Lowell 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 Lowell, Middlesex County, Massachusetts, area can provide invaluable financial support to businesses and provide guidance of when it might be time to seek the advice of a qualified Lowell Chapter 11 bankruptcy attorney. Some Lowell 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, a Lowell Chapter 11 bankruptcy is much more complicated and requires the advice of a qualified Lowell Bankruptcy Attorney.

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

Banks and Mortgage Companies such as Bank of New England-North, National Association (61 Merrimack Street, Lowell, Massachusetts 1853) and Butler Bank (10 George Street, Lowell, Massachusetts 1852).

Car Dealers such as Advanced Auto Sales (479 Broadway Street, Lowell, MA 01854) and Advanced Automobile Sales (577 Middlesex Street Front, Lowell, MA 01851).

Jewelry Stores such as Lowell Jewelry & Loan (181 Easy Merrimack Street, Lowell, MA 01852).

The Basics of a Chapter 11 Lowell Bankruptcy:

A qualified Lowell 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 Lowell and Middlesex County, Massachusetts (but they may vary depending on specific circumstances):

► The case begins when the petition is filed with the bankruptcy court. Middlesex County cases are filed with the Massachusetts Southern Bankruptcy Court located in 1101 O'Neill Federal Building, 10 Causeway Street, Boston, MA 02222, (617) 565-8950.

► 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 Lowell Bankruptcy Attorney will advise you on the effects of confirmation of your plan.

Contact a Lowell Bankruptcy Attorney for advice and consultation about filing a Ch. 11 Middlesex County Bankruptcy.

Serving clients throughout Eastern Massachusetts, including Andover, Beverly, Billerica, Boston, Bridgewater, Brockton, Cambridge, Chelmsford, Danvers, Dedham, Easton Center, Fall River, Framingham, Franklin, Gloucester, Haverhill, Hingham, Ipswich, Lawrence, Lexington, Lowell, Lynn, Manchester, Marblehead, Marlborough, Medford, Methuen, Milford, New Bedford, Newton, North Attleboro, Norwood, Peabody, Plymouth, Portsmouth, Providence, Quincy, Randolph, Revere, Salem, Tewksbury, Wakefield, Waltham, Wellesley, Weymouth, Woburn, Worcester, areas in the vicinity of Logan Inernational Airport, and other communities in Middlesex County.