Chapter 11 bankruptcy typically is used for business reorganizations. However, this type of bankruptcy is not just handy for a business owner in Massachusetts. Individuals can also take advantage of it if they have business debt issues or consumer debt problems.
Individuals have eligibility for Chapter 11 if they have unsecured debt totaling over $360,475. They can also proceed with a Chapter 11 bankruptcy filing if they have secured debt totaling over $1,081,400. An attorney can outline how a Chapter 11 bankruptcy filing may prove beneficial in either of these situations.
In Chapter 11, filers serve as their own trustees unless the bankruptcy court chooses to appoint trustees for them. This means they can recover particular payments that have been made to creditors, and they can also object to any claims. As trustees, individuals can also propose plans to creditors for partial or full payment of any claims made against the individuals. These individuals essentially exercise most of the duties and powers that trustees would have.
In Chapter 11, the United States Trustee, which is a part of the United States Department of Justice, is responsible for monitoring a person’s case. The person filing bankruptcy will have to fill out reports each month detailing his or her income as well as payments. The government will then collect a fee from the person each quarter based on how much he or she has spent.
In Massachusetts and all other states, cases involving Chapter 11 bankruptcy are usually more expensive and complex than those involving other chapters. This is true for both an individual and a business owner. Accordingly, it makes good sense to speak with an attorney about all of your options for debt relief before making a decision on how to address your particular circumstances.