During bankruptcy proceedings, there are a few steps that need to be completed. Whether you are a business owner or an individual claiming bankruptcy, you may have to attend a meeting of creditors. At this meeting, your creditors that you owe money to will attend. They will be waiting to hear what your reorganization plan is for your finances. This will inform them of how you plan to pay back the money you owe to them. This plan will need to be approved by the bankruptcy court in order for it to go into effect.
For businesses, your debt payments may be restructured to help your business maintain a revenue stream while you pay back your debts. The payments to your creditors may be paid back over the course of a five-year plan that is presented to them. This organizational plan can keep your business open and running as usual. This will allow your employers to continue working and they will not have to worry about losing their jobs.
For individuals going through Chapter 13 bankruptcy proceedings, they may also have to attend a meeting with creditors. At this meeting, you, your attorney, your trustee and creditors who wish to attend will discuss your financial situation and decide on a repayment plan that everyone agrees on. You should have previously filed a repayment plan that detailed the schedule of compensation that the trustee will distribute to creditors. A judge will decide within 45 days if the repayment plan is sufficient and if cleared, the payments should begin within 30 days after filing.
What processes include the automatic stay?
Bankruptcy proceedings include the automatic stay that goes into effect to benefit the debtor. The automatic stay is involved in individual and business bankruptcy. It can help alleviate the stress of the debtor by barring contact from creditors. Creditors are not able to harass these debtors any longer for the money that is owed to them. This can help the debtor focus on creating a plan to fix their financial situation. During this time, they can work with their attorney and complete the process for either individual or business bankruptcy. The automatic stay is a useful tool in bankruptcy processes since it can ease the stress that the debtor is facing.
If you require the services of an experienced Business Law or Bankruptcy attorney, contact the Law Offices of Allen A. Kolber, Esq. today to schedule a consultation and discuss your options.