Seeking a bankruptcy lawyer Middletown, CT business owners recommend should be one of your first considerations when determining whether filing for bankruptcy is the proper solution for your financial woes. We know that mounting debt is cause for businesses’ concern across the country, but with the right solutions, it doesn’t have to keep you up at night. Struggling to make payments, falling behind or in default, and experiencing constant calls from creditors can be incredibly overwhelming. It’s important not to ignore the problem. At Eric Lindh Foster Law, LLC, we aim to help business owners resolve their financial woes should bankruptcy be appropriate for their situation. As an attorney with a practice focused on business and bankruptcy, we are committed to providing services to small business owners in need of assistance. We know that you will have many questions moving forward.
What is bankruptcy?
Bankruptcy is a legal process that is overseen by the federal bankruptcy courts. It is designed to assist individuals and businesses to eliminate all or part of their debt or to help them repay a portion of what they owe.
Bankruptcy could be an option for you so that you can get relief from your debt. While all of that sounds great, you must understand that when you declare bankruptcy it is very serious and can have a long-term effect on your credit. Bankruptcy will remain on your credit report for 7 to 10 years. That type of long-term effect could impact your ability to open credit card accounts and to get approved for loans with favorable rates.
It is a complicated process and it isn’t advisable to go through this alone. That is why you need to consult with a bankruptcy lawyer to help you ensure your bankruptcy goes smoothly and you understand every step of the process as it happens.
When you decide to file for bankruptcy there are a few requirements that you will need to meet. You will need to demonstrate that you can repay your debts and you will need to complete credit counseling with a government-approved credit counselor. This counselor will work with you to assess your finances, discuss alternatives to bankruptcy, and help with creating a personal budget plan for you.
All bankruptcy cases in the United States are handled through federal courts. Any decisions that are made in federal bankruptcy cases are made by a bankruptcy judge. A bankruptcy judge will make decisions like whether a debtor is eligible to file and whether they should be discharged of their debts. An officer appointed by the United States Trustee Program of the Department of Justice will represent your estate in the proceeding. There tends to be very little direct contact between the debtor and the judge during a bankruptcy case unless there is some type of objection made in the case by a creditor.
In the United States, bankruptcy filings fall under one of several chapters of the Bankruptcy Code:
- Chapter 7: Involves the liquidation of assets
- Chapter 11: Involves a company or individual reorganizations
- Chapter 13: Arranges for debt repayment with lowered debt covenants or specific payment plans.
What are some advantages and disadvantages of filing bankruptcy?
When it comes to filing for bankruptcy there are some advantages and disadvantages that you need to be aware of. First, bankruptcy can help relieve you of your legal obligation to pay your debts and either save your home, business or just be able to function financially. However, it can lower your credit rating, which will make your life difficult. With a lower credit rating, you will find it to be more difficult to get a loan, mortgage, credit card, buy a home or business, or even rent an apartment. This isn’t ideal for everyone and could pose even more difficulties for you as long as a decade after you declared bankruptcy. You must understand both the disadvantages that come along with bankruptcy before declaring bankruptcy.
Why would a small business owner consider filing for bankruptcy?
For a business owner who has spent time building their business with both their time and finances, filing for bankruptcy is often dreaded. Creating something from the ground up is a significant task, and sometimes, no amount of time and finance can bring consumers through the door. Deciding to file for bankruptcy was likely difficult and not something that was taken lightly. However, the odds for small businesses are not always in their favor, especially with the pandemic that is sweeping the globe. For businesses seeing a decline in revenue and unable to cover their expenses, bankruptcy may be an appropriate option. Our Middletown, Connecticut bankruptcy lawyer should be one of your first calls when considering bankruptcy as an option. The steps to take and the chapter to file will be mostly dependent upon how your business is structured and your particular situation.
What chapter of bankruptcy filing is most appropriate for a small business owner?
The type of bankruptcy filing depends on the type of business you have, the structure, and your hopes for the future. This is a primary reason to work with an experienced lawyer. They will work closely with you to review your small business’s details and help develop a plan for moving forward. However, generally speaking, many small businesses may consider filing for either Chapter 7, Chapter 11, or Chapter 13 bankruptcy.
Why should I choose Eric Lindh Foster to represent my small business?
Eric Lindh Foster brings over 28 years of experience in representing small business owners in business and bankruptcy matters. Not only can services provide counsel for business operations, but we can also advise you on some of the most challenging decisions you might face as a small business owner. With experience advising leading commercial banks, our lawyer will provide you with sound counsel so that you have confidence in knowing that you are making the best decision for yourself and your small business.
Eric Lindh Foster Law, LLC is committed to providing affordable, high-quality legal services and solutions to business owners dealing with debts and financial issues. We know you have worked hard to build your business, and we want to help you develop plans that are in your best interest. For more information about our practice and our services, contact our Middletown, Connecticut bankruptcy lawyer to get started.