Are there any restrictions on how much I can borrow during a Chapter 11 bankruptcy?

Yes, there are restrictions on how much you can borrow during a Chapter 11 Bankruptcy in South Carolina. The Bankruptcy Code sets a maximum amount that you can borrow, or “debtor-in-possession” financing. This amount is based on various factors, including the amount of your allowed secured and unsecured claims, your projected disposable income, reasonable additional expenses, and the availability of other financing. The Bankruptcy Code also requires that any debt you take on during the bankruptcy reorganization is necessary for your reorganization and is reasonably necessary for the operation of your business. This means that the debt must be necessary for your business to operate, rather than to fund an extravagant lifestyle or to pay creditors money that is not owed to them. In addition, any new debt you take on must be approved by the court. The court will review the debt to ensure that it is necessary and for the benefit of your business and its creditors. If the court decides that the debt is necessary and beneficial to your business and creditors, the court will approve the loan. Finally, when considering whether or not to approve a loan, the court will also consider the amount of cash collateral that you have available to secure the loan. If you have too little cash collateral to secure the loan, the court may deny the loan. Overall, in Chapter 11 Bankruptcy in South Carolina, there are restrictions on the amount of debt you can borrow and the court must approve the loan and consider whether or not there is sufficient cash collateral available to secure the loan.

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