There is no doubt that the COVID-19 pandemic has significantly impacted all of us – especially those who were forced to close their small businesses since early March pursuant to government orders to help stop or reduce the spread of the coronavirus. Due to these current events, your small business may be facing bleak prospects in the short term, regardless of how strong your business is overall. Depending on your specific circumstances, this could be a good time to consider filing bankruptcy.
If you have little hope that you will be able to rebuild when circumstances improve, filing Chapter 7 liquidation bankruptcy may be the best option for you. On the other hand, if your business is up and running, filing Chapter 11 reorganization bankruptcy may be a better option.
How Can Chapter 7 Bankruptcy Help?
A Chapter 7 bankruptcy involves liquidating your company’s assets. The bankruptcy trustee assigned to your case will gather up all of your business’s assets and sell it in order to use the proceeds to pay creditors in accordance with the provisions of the Bankruptcy Code.
Filing for Chapter 7 bankruptcy will allow you to close your business without substantial debt. After the trustee sells your company’s assets and pays off creditors, most of the remaining debts will be discharged. However, some debts are not dischargeable so it is in your best interest to discuss what debts can and cannot be discharged in a potential bankruptcy filing. Your Central Valley bankruptcy attorney will need to determine how effective Chapter 7 may be in your case.
Deciding What Is Best For You
Determining what type of bankruptcy is best for you or your business, or whether you should file bankruptcy at all, is fact specific. In order to make the best decision given the specific facts of your case, you should talk to an experienced bankruptcy attorney as soon as possible.
Call an Experienced Central Valley Bankruptcy Attorney
If you or your business has been impacted by the COVID-19 pandemic and are planning to file or in the midst of a bankruptcy proceeding, it is in your best interest to consult with an experienced bankruptcy attorney to help you learn your legal rights and options, especially with respect to Chapter 7 bankruptcy.