When to Choose Arizona Chapter 11 Bankruptcy

Businesses and individuals that have too much debt to qualify for Chapter 13 bankruptcy may choose to file Arizona Chapter 11 bankruptcy. Since there is no debt limit with a Chapter 11 case, it may be an alternative when the liabilities are over the debt limits of Chapter 13. Furthermore, some businesses with excessive debt or sole proprietor businesses might find that Chapter 11 bankruptcy is a better solution overall even if they do qualify for Chapter 13 or Chapter 7.

Arizona Chapter 11 Bankruptcy is a Reorganization Bankruptcy

In a Chapter 11 bankruptcy, your business usually proposes a plan to repay creditors while the business remains open and running, assets remain in your control, and you work to achieve a fresh start. The creditors must vote in favor of the debt repayment plan, which is different, and more complicated, than in a Chapter 13 case. To build a plan that will be approved, an experienced bankruptcy attorney must be involved. The success of a Chapter 11 plan of reorganization depends on an experienced bankruptcy lawyer who understands the unique challenges of Chapter 11.

Arizona Chapter 11 Bankruptcy is Not Just for Businesses

Chapter 11 bankruptcy can benefit individuals, too, if they do not qualify for a Chapter 13 or if their financial situation is more complex. For example, an individual Chapter 11 bankruptcy can help protect investment property while restructuring mortgage debt in more flexible ways than in Chapter 13. By proposing a repayment plan that receives creditor approval, individuals can gain time to repay their debts without forfeiting their assets.

Filing for Chapter 11 bankruptcy in Arizona is very different than either Chapter 13 or Chapter 7. It is especially important to consult with knowledgeable bankruptcy attorneys, such as those at Radix Law in Phoenix and Scottsdale, AZ. The bankruptcy lawyers at Radix Law successfully represent individual Chapter 11 debtors.

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