The most common types of bankruptcy are Chapter 7 and Chapter 13, but there is also a Chapter 11. The Chapter 11 is strictly for business and is far more complicated. It is more geared towards reorganizing the debt. The debtor does get the chance to produce a plan, however after a period of time the creditors can put forth a plan.
No matter which plan is put forth the creditors have to give their vote of approval. Most businesses prefer to use the Chapter 7 bankruptcy option. However, in these cases the business is dissolved.
For the Chapter 11 bankruptcies there is no mandatory means test, which there is for Chapter 7 and 13. The means test is a method used to see if the party applying is eligible for that particular bankruptcy. This is applicable for both businesses and personal bankruptcy under the Chapters 7 and 13.
Individuals who are claiming bankruptcy do not have the option to cancel contracts for example like student loan debt, but businesses can cancel creditor contracts if it financially feasible for both the debtor which is the business, and the creditor.
No matter whether you are going personally bankrupt or your business is apply for bankruptcy relief it is a wise decision to retain the services of a Fort Worth bankruptcy attorney. These are lawyers who specialize in this area of the law and are able to assist you through the entire process.