Chapter 7 Business Bankruptcy Liquidation
Chapter 7 Business Liquidation
Bankruptcy Law – Chapter 7 Business Bankruptcy
Arizona Chapter 7 Business Liquidation
A Chapter 7 business liquidation is a total liquidation process of the business’s assets. While an individual in a consumer Chapter 7 bankruptcy is eligible to receive a discharge of his or her debts at the end of the bankruptcy, a business does not receive a discharge. Rather, the Chapter 7 trustee collects all the business’s assets and sells them at an auction at fire sale prices and distributes the proceeds to the business’s creditors. At the end of the process, the owner closes the business down.
If the owner as an individual qualifies for a Chapter 7 by having an income below the average for a family of his or her size in Arizona, then the owner’s remaining personal debts and the remaining business debts that the owner remains personally liable on can be discharged in the consumer Chapter 7 bankruptcy.
While Chapter 11 is more expensive, it offers a slower, more orderly procedure for selling assets and closing a business, or even selling the entire business to someone else as a going concern. However, if the owner is unable to rehabilitate the business and the business keeps losing money throughout the Chapter 11, the owner can convert the Chapter 11 to a Chapter 7 business liquidation, to dispose of what is left.
Chapter 7 business liquidation is a good solution if the owner is insolvent and qualifies for a consumer Chapter 7 as well, so that any business loans the owner might have personally guaranteed can be discharged, or if the business debts far outweigh the business assets.
Start Your Chapter 7 Bankruptcy Case Today
During our initial consultation, we will help you review your financial situation, assess your options and choose the best course of action for you and your family. To learn more, we encourage you to contact us to schedule an appointment. Please contact us online or call our offices in Phoenix or Cottonwood at 602-275-3238.
If you are seriously considering Bankruptcy as an option to get out from under your debt,
contact us today to schedule a consultation.