Business Bankruptcy Law | Small Business Bankruptcy Laws

This is what Southern District of Texas Bankruptcy website says: An individual cannot file under chapter 13 or any other chapter if, during the preceding 180 days, a prior bankruptcy petition was dismissed due to the debtor’s willful failure to appear before the court or comply with orders of the court or was voluntarily dismissed after creditors sought relief from the bankruptcy court to recover property upon which they hold liens. 11 U.S.C. §§ 109(g), 362(d) and (e)

I have a small retail busiess with a personal guarantee with both my landlord and a couple of creditors. I need to determine the best way to get out of these guarantees without filing personal bankruptcy.

Is it because state pension funds have some of the stock? It’s already in the low single digits and ultimately these companies will fail, so why prolong the agony?

Is it because the unions are against this, since their lucrative contracts will be avoided once the creditors take over? Those contracts are unsustainable anyway, so why not break them now?

Is it that Congress somehow doesn’t understand that Chapter 11 is not the same as Chapter 7, i.e., that the companies will still make cars and stay in business?

Is it that because of the financial crisis, the car companies wouldn’t be able to find DIP financing? In that case let the govt guaranty the DIP financing, rather than just loan money into a black hole?
Holy Cow, if people don’t buy the product a business produces, then the business should be allowed to fail, so that its assets can be used to produce something that people want to buy.

My brother owns and operates a small mechanics shop that caters to race cars and making strret cars ready for racing. He has owned the business for 5 years but is barely making ends meet. He has taken out a second mortage and has obtained about 25k of credit card debt. This is his dream job and loves it and the business is good but he just can’t seem to get ahead and now the debts are pilling up and his luck is running out. Are their government grants, free monies or any advise you can give to help him keep his business, pay off his debts AND feed his family? I have looked at how to stave off the creditors but have come up with little. I know about consolidation but not sure how much this will help in keeping the business! Any advise would be cherished and welcomed. Bankruptcy is not really an option, at least not yet! Thank you for an advise or help!

My mother has 2 houses going into foreclosure worth close to a million dollars, credit card debts, SBA loans, home equity loans, e.t.c. I have a few questions. One, will they EVER come after me(her son), or my father for her debt. Say I drive a BMW and live in a mansion with thousands in my bank account, can they come after it because of my mom? How bout my dad? Also, she’s thinking of filing chapter 7 but none of the lawyers want to touch her case. They’re excuses are: "The amount is too large", "too much work". Most importantly though, her SBA loan was done through a "broker" of sorts, a small business loan taken out from a business that doesn’t exist. The broker used some loopholes to do this, I think this is why lawyers won’t touch us. Please help me sleep in peace at night, will the creditors, banks, come after me or my dad’s assets/money? Also, how do I find a lawyer who handles large cases like this? The total amount for filing should be 1million+

Thanks so much ya’ll.

Hello guys. Unfortunately, due to a failed business, I have no choice but to file for bankruptcy. My question is…I heard in order to file for a Chapter 7 bankrutpcy, that you must pass a means test to see if you qualify. I heard that they look at the last 6 months of your income to see if you quality. My question is…"Is that 6 months of income from the time you file for BK or 6 months of income at the time that you do the "Meeting of the Creditors?" I don’t obviously have income now because of the failed business but am looking for a job in order to live. Also, does the judge take into consideration that I am filing for BK due to a failed business and not because I bought all these luxury items? For anyone that has info on the new BK laws, I would greatly appreciate it. Thank you

I am in substantial debt,and sought help from a debt consolidation company, and was misled by them, and can’t make ends meet even with their "help". They lied about where the money I’m paying them every month is going to, and lied about the fact that they would call my creditors and end the harassing calls. I still get about 5 to 7 calls a day. When I’ve called the company representing me about why I was still being harassed via phone and mail, they told me, "no you misunderstood us, you need to talk with the creditors and give them our phone number". If I had known that, I never would have done business with them. They promised me an end to the calls.They are not representing me like they said they would, and in addition are not handling my money as they agreed too. Can I legally terminate their services, and sue them? I have made an appointment with a Bankruptcy lawyer, that’s how bad things have gotten. I already feel ashamed of myself, please only serious people respond.

Bailout isn’t going to happen…
and the more I think about it the worse the bailout idea gets

from link:

Reorganization Under the Bankruptcy Code

The chapter of the Bankruptcy Code providing (generally) for reorganization, usually involving a corporation or partnership. (A chapter 11 debtor usually proposes a plan of reorganization to keep its business alive and pay creditors over time. People in business or individuals can also seek relief in chapter 11.)
http://www.uscourts.gov/bankruptcycourts/bankruptcybasics/chapter11.html

That is the way it’s done when company can no longer compete…for whatever reasons…isn’t it?

Hello,
we got into a bad business a couple years ago and have a lot of debt and lost the business. we haven’t been paying our credit card bills since January. We have been getting letters and nonstop phone calls for a few months now. We have a bankruptcy lawyer and are going to file for personal bankruptcy because the business debt is personally guaranteed. However, we can’t file just yet (not until September for personal reasons). We are wondering how long does it take for the creditors to come after us and claim our assets. is that possible? what are our options other than filing for bankruptcy right now. We are also losing our house and we are moving into a rental in July.

our relatives invested 200,000 in a business we bought. however everything is under my name. I am forced to file for personal bankruptcy because all the debts are personally guaranteed the business is bad. my family knows exactly where the money went and how it was spent. they had access to my bank account and the computer etc..
I talked to my bankruptcy lawyer and he said we can put our family members are ‘creditors’ so they can ‘write off’ the 200,000 as a loss.
I am wondering how this will work. how will they benefit from this? will they receive some money from this? how much? if they invested this money in Dec05/Jan 06 can they write it off for this years taxes? the business is still a valid corp. I just don’t want them to be at a complete loss and if I can help them somehow to get their money back or portion at least.
what necessary steps to they have to take? and do we have to file for bankruptcy before they file for their taxes?
please helpp!

I’ve always wondered why when a company files for banruptcy protection but plans on staying in business does the company never satisfy former shareholders by giving their often worthless shares shares in the new company. I understand loans & creditors get first dibs on anything but again if the company plans on coming out of it why not give shareholders part of the new company even if it’s a small part with the bulk going to those it owed money to thus paying their debt through IPO or something like that. Just seems like a big middle finger to shareholders to just write off their ownership or loyalty yet when the company comes out of it insiders who may have been a big part of why it went bankrupt get some. Seems only fair that creditors & shareholders gets something especially over those who might have been a cause. If the company was going out of business I could see why shareholders wouldnt get anything but if it plans on coming back why stick it to shareholders?

So, I need to file bankruptcy. I’ve thought about my situation for a long time now and I’ve decided that it’s what I want to do. I have a few questions though and figured I’d post on here while I did research.
1) What costs are involved?
2) Do you have to have a lawyer and go to court?
3) Can a business refuse to let you file for your account with them? Can they fight it?
4)I don’t know who all I owe money to anymore. I tried to do my credit check but it wouldn’t work. When I file, will they be able to bring up all of my debts and creditors?
5)How long does the process take?
6) I have one (or more) account that is with a collection agency that just told me that they are going to send it over to legal services in the next few days. What does that mean? Can I file bankruptcy on this? Is there anything you cannot file on?
7)Will this affect my financial aid at school?
8)What experiences have you had or observed post bankruptcy? What happens and in what amount oft ime?

I am a business developer, But I am in need of some australian legal advice. One of my clients is being sued by a creditor(Fairfax Newspapers) for an unpaid advertising account(The client did try to organize payment plan, but requested that their advertisement remain printed so that they may have the funds to continue to make payments, but was refused). Their business went belly-up during Christmas last year, and they sadly have not recuperated from the blow, and are suffering some heavy financial troubles. They are young, and stuck, and I am inclined to tell them to apply for bankruptcy to stop the creditors from pursuing them legally. What do law gurus say about this?

Hello,
we got into a bad business a couple years ago and have a lot of debt and lost the business. we haven’t been paying our credit card bills since January. We have been getting letters and nonstop phone calls for a few months now. We have a bankruptcy lawyer and are going to file for personal bankruptcy because the business debt is personally guaranteed. However, we can’t file just yet (not until September for personal reasons). We are wondering how long does it take for the creditors to come after us and claim our assets. is that possible? what are our options other than filing for bankruptcy right now. We are also losing our house and we are moving into a rental in July.

I am sick of people not paying! If you sign your name to something you should have to pay for it!
Have some pride and go see your creditors if you cant pay! Try to work out a new plan! ONly lawyers win in bankruptcy…they charge high fees and you will pay more than u owe!! Lots more!
Why should you get something free? Yea if you bought something and did not pay for it you really shafted the business! I am in business and I lost respect for those that file bankruptcy!
I dont owe you anything! If you cant pay the bill dont do the deal!
Your just a bunch of lazy no good bums trying to rip off those people that work hard and have some sense of responsibilty!

My sister in law is thinking of declaring bankruptcy. I’m concerned about this because I hold two rental properties with her. We are holding the homes in an LLC. So I think were okay but just wanted to double check. Is there anyway that the creditors could come after the business’s assets?

I am currently being sued in civil court, and have no money for an attorney, the case has gone on for a year now in federal court, and have basically lost my business because of all the time I’ve put into defending myself from something I did not do, and am being "lawyered" to death by 6 lawyers. Because of all this, even if I "would easily win" if I could afford an attorney, I will have to file bankruptcy (chapter 7 for me).

Therefore, relating to an ONGOING CIVIL case and a need to file BANKRUPTCY, here’s my QUESTIONS if you would please use the same numbering system to answer them so I can keep track (thanks thanks thanks):

I would LOVE it if filing the bankruptcy would END the case so I could go on with my life, find another job, build another company etc. I read a lot of yahoo answers and one said “If they haven’t gotten judgment against you … then your bankruptcy filing can and will stop the case.”, but I need to be sure.

1) is there any ADVANTAGE to me in filing bankruptcy BEFORE the judgment (now is preferred so that I can go on with my life which has been destroyed)?…. and what will opposition do if they know I’ve filed for bankruptcy? Will they attempt to continue the case when they know the bankruptcy will go thru? If so, why would they continue the case?

2) Since I’m going to be filing In advance" of the judgement, can I "claim" the "injuries" they haven’t yet enumerated " …on my petition for bankruptcy? …or do I just “list the case” and say “amount pending”? THANKS.

I know about the "automatic stay" (keeps creditors (I currently have NONE and a perfect credit score I’ve worked hard to build all my life) from coming after you etc).

3) After I file for bankruptcy (I know it takes so many months to go thru), these additional related questions, thanks:

3a) what happens to the current civil case?
3b) what do i tell the judge? Do i have to tell the judge or just inform the other side?
3c) will i still have to finish the case (expected one more year of my life)?
3d) if we’re currently in discovery, will it / can it stop discovery / subpoenas etc?
3e) ….or…does it just “suspend” the case until the b/k procedings are over? …or does the case just continue on in real-time?

Thanks so much for answering all of these "sub-parts" to my ‘compound" question. They’re really important to my life and my families lives.
Ryan K,

That was totally useless. I can’t believe you actually answered 195 other people. You’re a joke.

Now that congress has passed the new bankruptcy laws that do not allow credit obligations to be totally wiped clean, this has given creditors free reign to file lawsuits for bad credit. The amount of lawsuits are jumping high as it is forcing people to file bankruptcy which under the new rules forces them to pay regardless. This use to be bad policy for creditors as it created bad business for consumers.

Do creditors have right to sue consumers with money they have made off of consumers? Should credit be regarded as an investment made by a creditor to a consumer and if that investment goes bad to not cry about it? Are in likewise manner people allowed to sue companies and stock brokers if our investments are lost for one reason or another? So if that cannot be allowed should corporations be allowed to sue consumers for their own bad investments?

Should this be allowed or should congress amend the law to disallow lawsuits for credit obligations?

I lost my business, home, etc and owe a lot of business and personal debt. I want to pay it in time but can’t afford to pay anything right now. The creditors are harassing me and so I need to file now because one has filed a judgment against me.

I own a bridal store that I bought in 2006, it has not profited since. I have not received pay roll since I purchased the store. Now that the economy has gotten so bad and with debt to creditor and suppliers, I am thinking of claiming bankruptcy. It is a sole prop. and I am planning also to claim personal bankruptcy. I found out my step mom has cancer again and I’ve been so stressed with the business and the cancer issue, that I would like to claim bankruptcy.
What is the process in ch 7 bankruptcy? mainly the trustee part. Does it mean that I no longer need to open the business and someone else will be at the store selling off all our gowns and basically closing the store and paying off our debt? what is the time line for that? Also, I feel so embarrassed that I can’t pay off my debt in the business, do I contact my creditors and suppliers or does someone else contact them?
Thank you for your help. I am planning to talk to a lawyer soon. Thanks again.