chapter 11 bankruptcy for business

Chapter 11 Business Bankruptcy Attorneys

Experienced Detroit Area Bankruptcy Attorneys | Wayne, Macomb & Oakland County

Chapter 11 of the Bankruptcy Code provides for reorganization of a business’s debt. A Chapter 11 debtor usually agrees to a reorganization plan to keep their business afloat and pay creditors over time. People in business or individuals in certain business related situations can also seek relief in Chapter 11.

Chapter 11 is typically used to reorganize a corporation, sole proprietorship, or partnership. A corporation exists separate and apart from its owners, the stockholders. A Chapter 11 Bankruptcy does not put the personal assets of the stockholders at risk. A sole proprietorship Chapter 11 bankruptcy, on the other hand, includes both the business and personal assets of the owners-debtors. Like a corporation, a partnership exists separate and apart from its partners. However, in a partnership Chapter 11, the partners’ personal assets may, in some cases, be used to pay creditors – or the partners themselves may also be forced to file.