When must I pay my creditors during a Chapter 11 bankruptcy?

When filing for Chapter 11 bankruptcy in Oregon, it is important to understand when you must pay your creditors. The court-supervised process of a Chapter 11 Bankruptcy is designed to reorganize and restructure the debtor’s liabilities and allow them to continue to operate its business in a financially viable manner. When filing for Chapter 11 bankruptcy, a debtor is typically required to submit a plan of reorganization to the bankruptcy court. This plan must describe how the debtor proposes to pay its creditors, and it must be approved by the court before it can go into effect. The plan of reorganization will typically include a proposed schedule for repaying creditors, which details when and in what order creditors should expect to be paid. The Chapter 11 Bankruptcy Code also allows a debtor to retain certain assets such as furniture, fixtures, and equipment, and use the proceeds from those assets to pay creditors. The plan of reorganization may also provide for a payment to creditors from future profits or from a settlement with other creditors. Finally, a Chapter 11 Bankruptcy plan may also provide for a partial payment of the outstanding debt. This means that if the debtor cannot pay all of the debt in full, they may be able to pay a portion of the debt within a specified period of time. Ultimately, the details of how and when a debtor must pay creditors will be determined by the court and the details of the debtor’s plan of reorganization.

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When must I pay my creditors during a Chapter 11 bankruptcy?

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