If you’re a small business owner and you’re considering filing for bankruptcy, it’s important that you have information on which type of bankruptcy you should file for. Filing fort bankrupcy it is definitely not an ideal situation, but sometimes it’s necessary. Having the right information will help you to make the right decision so that you can begin to improve your financial situation in the most effective way possible. If you’re a small business owner in Mankato, MN, then chapter 7 bankruptcy will more than likely be the right option for you. In some cases, however, chapter 13 bankruptcy may be a more viable option.
Let’s take a look at your options to find out which one you should choose:
Reasons to choose chapter 7 bankruptcy:
- It will be settled much faster – Chapter 7 bankruptcy cases usually conclude in a matter of months whereas chapter 13 bankruptcy cases can take three to five years.
- It will be easier to start a new business – You can’t file bankruptcy for your business with chapter 13 bankruptcy. It would be much easier to close your current business down under chapter 7 than to try to keep it afloat while also having to deal with chapter 13 personal bankruptcy. You can deal with your debts and start a new and improved debt free business.
- You aren’t required to pay your unsecured debt – In chapter 13 bankruptcy you will be required to pay at least some of your unsecured debt in most cases. You aren’t obligated to do that under chapter 7 bankruptcy.
When chapter 13 bankruptcy may be the right option:
- You have an asset rich business – If you’re a small business owner and you don’t want your business to be shut down because it has a high amount of valuable assets that you want to keep, you should not file for chapter 7 bankruptcy. You may even want to try and settle your debts on your own and avoid filing altogether.
- You want long term protection – If you want more time to catch up on certain payments like your mortgage or car payment under the protection of bankruptcy law, then chapter 13 bankruptcy is a better option.
- You have a unique asset that you want to keep – If you have a certain asset that is not protected under chapter 7 bankruptcy but is protected under chapter 13 bankruptcy, then choose the latter.
Hopefully this information can help you make the right choice. If you’re a small business owner and are considering filing for bankruptcy or just want more information, contact the professionals at Behm Law Group Ltd in Mankato, MN. We’re here to guide you and help you build a better financial future.