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Chapter 11 Bankruptcy Attorney

A Chapter 11 bankruptcy, sometimes called business reorganization or business restructuring, is primarily designed to help struggling businesses reorganize their financial affairs to be able to continue operating. A Chapter 11 bankruptcy may also be used by individuals who do not operate a business, but a Chapter 11 is only advisable for such individuals if their debts are too high to qualify them for Chapter 13 bankruptcy, and they do not qualify for or for other reasons cannot file for Chapter 7 bankruptcy.

One of the policies underlying Chapter 11 bankruptcy is that it is better to enable a business to continue operating, as opposed to simply liquidating, because this preserves the going concern value of the business, and in addition preserves jobs and avoids the other detrimental effects on the local community that usually result from the dissolution of a business. As a result, a Chapter 11 bankruptcy offers many options and significant flexibility to a business debtor that are not available outside of bankruptcy.

Chapter 11 Bankruptcy Benefits

In addition to the automatic stay, which prevents most creditors from taking any collection action against the debtor, a Chapter 11 bankruptcy enables the debtor to:

  • eliminate or in other ways modify unsecured debt
  • reduce secured debt
  • reduce interest rates on secured debt
  • reject unfavorable contracts
  • obtain new financing by offering the lender incentives that are not available outside of bankruptcy, such as a lien with priority over all pre-existing liens
  • use, sell, or lease property of the estate, even if the property is subject to a lien
  • recover transferred property
  • avoid preferential, fraudulent, and certain other transfers

Of course, whether any one of these options is available to any particular debtor depends on that debtor’s specific circumstances.

Even if there is no intent to reorganize a business, a Chapter 11 bankruptcy is often beneficial to allow for an orderly liquidation of the business. If the business can continue operating and producing income, or if there are assets unencumbered by liens, this option should be considered.

Chapter 11 Bankruptcy Process

A Chapter 11 bankruptcy is implemented through the proposal and court approval of a reorganization or liquidation plan, a document which sets out the terms on which the reorganization or liquidation will take place. Importantly, the debtor usually has the exclusive right to propose such a plan during the 120 days after the filing of bankruptcy. This allows the debtor additional time and leeway to determine how best to proceed in restructuring or liquidating its business.

Ultimately, each Chapter 11 bankruptcy requires an individualized approach, based on the business’s unique financial condition and the goals of its management. Because of the complexity involved in Chapter 11 bankruptcy cases, and the planning that is often required in order to take full advantage of the benefits of bankruptcy, it is best to contact an experienced bankruptcy attorney as soon as the business begins to experience significant financial difficulties.

Learn More About Chapter 11 Bankruptcy

To learn whether Chapter 11 bankruptcy is advisable in your situation, please contact a Mesa and Tucson Chapter 11 bankruptcy attorney at Yusufov Law Firm PLLC via this website or by calling (520) 745-4429 in Tucson, or (480) 788-0098 in Mesa and Phoenix, for a for a free consultation.

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Tucson Location
Yusufov Law Firm PLLC
5151 E. Broadway Blvd, Suite 1600
Tucson, AZ 85711

Phone: (520) 745-4429
Email: info@yusufovlaw.com

Mesa/Phoenix Location
Yusufov Law Firm PLLC
2266 South Dobson Road, Suite 200
Mesa, AZ 85202
Phone: (480) 788-0098
Email: info@yusufovlaw.com

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To discuss your financial situation and learn more about your debt relief options, give us a call at (520) 745-4429 or (480) 788-0098 or contact us via our website to schedule a free consultation.

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We represent clients throughout Mesa, greater Phoenix area, Tucson, and Southern Arizona, including Maricopa, Pima, Pinal, Santa Cruz, Cochise, Graham, and Greenlee counties.

Disclaimer: Submitting information through this website or via e-mail does not create an attorney-client relationship, and the information submitted will not be confidential, privileged, or otherwise protected. Please do not submit any confidential or sensitive through this website or via e-mail until you have spoken to an attorney from our firm either by telephone or in person.

We are a debt relief agency. We help people file for bankruptcy under the Bankruptcy Code. The material and information contained on these pages and any pages linked to from these pages is intended to provide general information only and not legal advice. You should consult with an attorney licensed to practice in your jurisdiction before relying on any of the information presented here. You are advised that the acts of sending e-mail to or viewing or downloading information from this website does not constitute an attorney-client relationship.

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