Chapter 11: It’s Not Just for Businesses

There is a very common mistaken belief that Chapter 11 reorganization bankruptcy is only for business entities.  To the contrary, Chapter 11 is ideal for high-income individuals or individuals with significant assets. Unlike Chapter 13 bankruptcy, there are no debt limits that determine your eligibility for Chapter 11 relief. Like business entities that file Chapter 11, individuals that file Chapter 11 can also take advantage of benefits like:

  • 4 months to develop a repayment plan for creditors
  • 5 years to pay priority taxes
  • The ability to reject unfavorable leases and/or contracts
  • The ability to restructure secured debts (excluding debts secured only by a primary residence)
  • The ability to pay unsecured creditors cents on the dollar (based on your projected disposable income)

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