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 email@example.com or go to www.orlandobusinessbankruptcy.com