Category Archives: Debt Collection
Fending Off Creditors’ Challenges in Bankruptcy Adversary Proceedings
An adversary proceeding in bankruptcy is essentially a lawsuit within the context of a bankruptcy case. It is initiated by a creditor or another party who seeks to challenge certain aspects of the bankruptcy or to resolve disputes that arise within the bankruptcy process. These proceedings can significantly affect the debtor’s ability to obtain a […]
Deciding Whether Chapter 11 Is Right for Your Business
In the face of financial distress, businesses can find themselves weighing the options available to address their operational challenges. Among these options, Chapter 11 bankruptcy stands out as a potential avenue for businesses to restructure their debts and reorganize their operations. This form of relief offers advantages but also involves complexities that necessitate careful consideration. […]
Defending Against Adversary Proceedings Brought by Creditors
Bankruptcy offers a fresh start for debtors struggling with overwhelming debt. However, this process isn’t always smooth sailing. Creditors may object to various aspects of the bankruptcy case by bringing an adversary proceeding — essentially, a case within the case. Such proceedings can arise when creditors challenge discharge of debts, allege fraudulent transfers or attempt […]
How Chapter 11 Restructures Business Debt
When a business finds itself drowning in debt, Chapter 11 bankruptcy can offer a lifeline. Unlike Chapter 7, which liquidates assets to repay creditors, Chapter 11 allows for debt reorganization. This means the business gets a chance to develop a plan to reorganize its debts and return to solvency. Here’s how Chapter 11 tackles these […]
Using Chapter 13 for Relief From Credit Card Debt
Crushing debt from credit card charges can feel inescapable. Minimum payments barely make a dent, and the stress of looming balances can be paralyzing. If you’ve explored other options and are still overwhelmed, Chapter 13 might be a path to financial freedom. Here is a primer on how this form of bankruptcy treats credit card […]
The Basics of DIP Financing During a Chapter 11
In a Chapter 11 bankruptcy, the person or corporation under bankruptcy protection is usually designated a debtor-in-possession (DIP), which means they can continue to manage the business freely though subject to obtaining court approval for major decisions. But a successful reorganization of the business requires infusion of additional capital. DIP financing is a remedy for […]
When Can a Chapter 11 Be Converted to a Chapter 7?
Businesses under financial distress can pursue a Chapter 11 bankruptcy if they believe they can reorganize and return to profitability. However, as the reorganization proceeds, there may be obstacles that cannot be overcome. In certain circumstances, a conversion to a Chapter 7 liquidation plan may be necessary. A Chapter 11 debtor usually has the right […]
Grounds for Creditors’ Relief from the Bankruptcy Automatic Stay
Once a bankruptcy petition is filed in court, an automatic stay goes into effect that prevents creditors from taking further action to enforce most debt obligations. The purpose of the stay is to give the debtor time to reorganize its finances through the bankruptcy process. The stay remains in effect throughout the duration of the […]
Obtaining Debtor-in-Possession (DIP) Financing During Chapter 11
For companies bordering on financial collapse, Chapter 11 bankruptcy can offer relief through protection from creditors and a debt restructuring plan that provides a way to return to solvency. But the reorganization process requires access to capital. This is why debtor-in-possession (DIP) financing is critical. It allows the debtor, who remains in possession of the […]
Facing Adversary Proceedings That Challenge Discharge of Debts
The goal of a bankruptcy is to obtain a fresh financial start by having some or all of your debts discharged — namely, wiped out. However, there may be reasons that a creditor or the bankruptcy trustee objects to the discharge of certain debts or to all of them. This sometimes results in an adversary […]
