{"id":414,"date":"2021-11-19T08:15:02","date_gmt":"2021-11-19T08:15:02","guid":{"rendered":"https:\/\/wordpress-596623-2274183.cloudwaysapps.com\/?p=414"},"modified":"2021-11-19T08:15:02","modified_gmt":"2021-11-19T08:15:02","slug":"business-debts-getting-uncontrollable-consider-bankruptcy","status":"publish","type":"post","link":"https:\/\/www.thinkfinanceinc.com\/business-debts-getting-uncontrollable-consider-bankruptcy\/","title":{"rendered":"Business Debts Getting Uncontrollable! Consider Bankruptcy"},"content":{"rendered":"\n

Bankruptcy\nmay be the scariest word for a small business owner. When you hear bankruptcy,\nyou may think of the financial ruin, losing your business, your home, your car,\nyour other property which put on a stake for your business. You may even feel\nlike you may never get another shot at entrepreneurship or any more business\nloans for you. <\/p>\n\n\n\n

Why file bankruptcy?<\/strong><\/p>\n\n\n\n

If your\nbusiness is consistently under debt and is unable to keep with the expenses\nthen it is already on a short trajectory towards bankruptcy. Filing for\nbankruptcy can offer you options to stay afloat and keep many of your assets.\nYou can still keep your business running after declaring bankruptcy while you\npay off your debts through the negotiation of terms, reorganization, and\nconsolidation.<\/p>\n\n\n\n

Moreover, filing bankruptcy might prove to be the smart next to save your struggling small business<\/strong><\/a>. It can save your business from the creditors who might want to liquidate your assets. However, you eventually have to pay them what you owe or less, but bankruptcy will buy you more time or even a reduction in the debts. <\/p>\n\n\n\n

Therefore,\nbankruptcy may be exactly what your business needs to get back on its feet.<\/p>\n\n\n\n

 What are the\ntypes of business bankruptcies?<\/strong><\/p>\n\n\n\n

You can file under three types of bankruptcies depending upon your situation as different businesses get affected by bankruptcy in different ways. Filing under the incorrect bankruptcy can have a negative effect on your finances and may even lead you to litigation. So, it is very important and off course wise to consult the best bankruptcy attorney Colorado Springs inhabits. <\/p>\n\n\n\n

However,\nthe three types of bankruptcies are:<\/p>\n\n\n\n

  1. Chapter 7<\/strong>– In this,\nyour business needs to be closed and is liquidated to pay all the debts. The\nsole proprietors file personal Chapter 7, covering both business and personal\ndebts<\/li>
  2. Chapter 11<\/strong>– In this,\nyou plan according to your business to reorganize and repay the debt. However,\nthe said plan must be approved by the creditors. Meanwhile, you make the\nrepayments you can keep your business open and maintain your assets. <\/li>
  3. Chapter 13<\/strong>– A payment\nplan is created by you to pay the debt along with a part of future income\nwithin three to five years. Companies and corporations do not qualify for this\ntype of bankruptcy. <\/li><\/ol>\n\n\n\n

    Sole\nproprietor business is eligible for all the three types whereas partnerships\nand corporations can file for Chapter 7 and Chapter 11. <\/p>\n\n\n\n

    When you should consider filing for bankruptcy?<\/strong><\/p>\n\n\n\n

    Here are\nsome of the points as when you should consider filing for the bankruptcy:<\/p>\n\n\n\n