Tuesday, August 31, 2010

A Few Advantages for Business in Chapter 11 Bankruptcy

There are several reasons for businesses facing tough financial times to look towards Chapter 11 for help. Just a few reasons are listed below:

1. It allows businesses to restructure unsecured debt. This means a business may only have to pay a fraction of their actual debt back to creditors and can still successfully operate their business during and after the Chapter 11 case.

2. It allows multi-location businesses to close some locations and to keep other locations up and running. This allows a business to keep profitable locations and to close unprofitable ones with little to no financial consequences.

3. It provides businesses time to deal with IRS and other tax debt, allowing these debts to be repaid over a long period of time with little to no interest and absolutely no penalties.

4. It allows businesses to stop foreclosure on valuable property that is imperative to the business.

5. It allows businesses to restructure real property loans to the current market value with a fixed interest rate over a new term.

6. It stops payments to creditors for a period of time after filing, allowing businesses to build up a possible cash reserve while deciding how to proceed with the business.

7. It allows businesses to deal with union contracts that may be killing cash flow.

8. It immediately stops any legal action against the company, including foreclosure proceedings.

There are many other advantages for a business to at least consider Chapter 11 bankruptcy when faced with tough financial times. Please feel free to call (407) 494-0665 or (386) 868-2650 to set up a free consultation to discuss what a Chapter 11 can and cannot do for your business.  You can also email me at jason@cwbfl.com or go to www.orlandobusinessbankruptcy.com

Monday, August 23, 2010

Individual Real Estate Investor Chapter 11 Cases

Individual Real Estate Investor Chapter 11 cases have been on the rise in FLorida because of the decline in the real estate market.  Real estate investors really have a lot to gain from a Chapter 11.  Below are just a few things that Chapter 11 may be able to do for the struggling investor.

1. It allows real estate investors to lower loan balances to the current market value of the real property and to restructure that loan over a new term with a low, fixed interest rate.

2.  It allows real estate investors to completely remove second or third mortgages from properties where the value is less than the first mortgage balance.  The second and third mortgages are then treated as completely unsecured and are discharged at the completion of the case just like a credit card debt.

3.  It allows individuals to restructure their unsecured debt, including unsecured second and third mortgages.  Individuals have to pay back anywhere from 0% to 100% to their unsecured creditors depending on their particular circumstances.  Even if 100% is required, it is paid back over at least five years with little to no interest and absolutely no penalties or late fees.


4.  It immediately stops any legal proceeding against the individual, including foreclosure proceedings.

5.  It provides a period of time where no payments are made on unsecured debt and smaller payments are made on secured debt which allows individuals to save up a cash reserve to operate.

There are many other reasons for real estate investors to consider Chapter 11 bankruptcy when faced with tough financial times.  Please feel free to call (904) 374-0111 or (386) 868-2650 to setup a free consultation to consider your particular situation and options.  You may also email jason@cwbfl.com or for more information please visit www.chapter11jax.com