What happens to my assets during a Chapter 11 bankruptcy?

In Washington, during a Chapter 11 Bankruptcy, a person’s assets are protected from being immediately seized. However, the court may require a person to use their assets to pay creditors to a certain degree. This means that a person could potentially lose some of their assets, but they will not lose them all. The first step of a Chapter 11 Bankruptcy is the filing of a petition with the court. This petition is known as a reorganization plan, and it outlines how much of a person’s assets will be used to pay creditors. The court will then review the reorganization plan to make sure that it meets certain criteria. The court may approve the plan if it is feasible, with certain modifications if necessary. If the court approves the reorganization plan, the assets of the person filing for bankruptcy will be protected and distributed according to the plan. This means that the assets will not be sold immediately, but will instead be used to pay creditors over time. The assets will remain in the debtor’s control, and their credit score will not be adversely affected. After the reorganization plan is approved, it will become binding upon the creditors and the debtor. The creditors will be required to follow the plan, and the debtor will begin to make payments according to the plan. This will allow the debtor to slowly pay off their debts over time.

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