What is Chapter 11 bankruptcy?

Chapter 11 bankruptcy is a form of bankruptcy protection that allows businesses or individuals to reorganize their debt and finances. In Chapter 11 bankruptcy, the debtor (the person or business filing bankruptcy) proposes a plan that reorganizes their debt and assets. The plan must be approved by the court before it can be enforced. This type of bankruptcy can allow the business or individual to continue operations while restructuring their debt. Chapter 11 bankruptcy comes with a number of requirements. In Washington, these requirements include filing a petition with the court, providing the court with a detailed bankruptcy petition, and providing information on the debtor’s assets, liabilities and current financial standing. The debtor must also attend a creditors’ meeting and a confirmation hearing, where a judge will approve the proposed plan. At the end of the process, the debtor’s debts can be reduced, payments can be extended, or the debt can be cleared altogether. Once the plan is accepted, the debtor is responsible for following it and paying back the new terms of the debts. It’s important to note that the creditors have the right to object to the proposed plan, so they must agree to the new terms before they can be enforced. In Washington, Chapter 11 bankruptcy is a powerful tool to help businesses and individuals get back on their feet financially. It also offers a way out for those who may have accumulated too much debt to repay.

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What is Chapter 11 bankruptcy?

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