Our Riverside bankruptcy lawyers often work with small business owners. Bankruptcy is one of the hardest decisions that many people will make. Bankruptcy is even more difficult if the person happens to be a small business owner. However, Chapter 13 bankruptcy can help save personal and business finances from further ruin.
Who Can File a Chapter 13
Chapter 13 is designed for an individual. Therefore, corporations and LLCs cannot file Chapter 13 bankruptcy. However, Chapter 13 can help sole proprietors or a partner in a partnership.
How Debts Are Dealt With
In Chapter 13, debts are restructured into a payment plan. A personal guarantor filing bankruptcy can include business credit cards and business debts into the Chapter 13 plan. Moreover, you can include your personal debts. You will make one payment each month for a set period of time. The amount of the plan is determined by your bankruptcy attorney, the bankruptcy trustee, creditors and judge in your case.
Getting Credit in the Future with the Help of A Riverside Bankruptcy Lawyer
Many small business owners clients want to know if they are able to get a small business loan after they file for bankruptcy. The answer is that you should be able to get some level of credit. Getting a small business loan depends on the business and its structure. It also depends on your ability to present the business in the best possible light. Filing Chapter 13 bankruptcy will make it harder to obtain credit. However, it will not make it impossible.
As a Riverside bankruptcy lawyer, one of the first things we remind clients of is that once you file your Chapter 13 bankruptcy, you will have a clean slate. However, you cannot file bankruptcy again for a number of years. On the other hand this makes you less of a credit risk than you might imagine. It also becomes possible for lenders to work with you. It is a good idea to be prepared to answer some basic questions like why you had to file bankruptcy in the first place. You also need to be able to demonstrate that your financial situation changed significantly which will make you a good credit risk. One of the easiest ways to show your improved credit situation is to make sure that you keep paying your agreed bankruptcy payments. Keep in mind that you will need to request the court’s permission to incur additional debt during your Chapter 13.
Ask a Riverside Bankruptcy Lawyer to Help you File your Chapter 13
As a Riverside bankruptcy lawyer who has represented many clients who also own small businesses in their personal bankruptcy filing, we recommend that you meet with us prior to making any bankruptcy decisions. We can help you to clear up your business and personal debt at the same time while also protecting your assets.
NOTE: This is for informational purposes only and does not constitute legal advice.