There a number of options in the case of filing for chapter 7 bankruptcy in San Antonio is considered. That is if it comes to the inevitable that indeed a bankruptcy has to be filed. Discussed in brief are the different options at hand.
Chapter 7 Bankruptcy
This is in other words, filing for liquidation. With this method a person’s assets are disposed of and the liability taken care of. If the amount of debts is higher than the assets, then it gets written off. There is a certain condition to qualify for a Chapter 7 and that is that the person must earn lower than the state median income in a year.
The disadvantage of this method is that the entity does not get to conduct business activity during the process of the liquidation.
Chapter 11 Bankruptcy
Probably the most commonly used method of taking protection from debt is this method. Here the debtors are given a time period to submit a business plan to pay out the debts that has been accumulated and it must be acceptable to the creditors as well. The plans of revival if found acceptable are executed to bring about a complete turnaround of the situation with some of the debts being recast or written off.
It is possible for businesses filling for a Chapter 11 to conduct the normal course of business. At times the time taken to get different debtors to agree to a common plan can be a huge draw back.
Chapter 12 Bankruptcy
This is the plan that is meant to be used by the farmers and fisher folks. The debtors are given a chance to come clean after having reconstituted the moneys owed. In case a suited formula as such is not arrived at then the creditors would get themselves involved in trying to effect a recovery.
Chapter 13 Bankruptcy
Here the debtors are kept in total control of the debt owed and a repayment plan that is suited to the better health of the enterprise is arrived at. This is more of a reforming of debts to come to a more useful and benign version of a high debt situation.
The disadvantage of this type of filing is that the business cannot take on any more extra debt. This could be at times time consuming often subjecting the firms to a slow death if not properly executed.
What makes filing for Chapter 7 bankruptcy in San Antonio or for that matter any bankruptcy filing an undesirable affair
The first image that a firm or enterprise gives out to the people when filing for any form of bankruptcy is that of financial mismanagement. But there are instances when the situation could well be due to factors beyond the control of a management. It is best that the health of a concern is protected at all times and recourse to bankruptcy laws be taken to the very least.