If your small business didn't go as planned…
bankruptcy might be the best solution.
Richard Hughes specializes in effective bankruptcy solutions tailored to the unique needs of your business. Discover how a skilled business bankruptcy lawyer can help you navigate the complex process and guide you toward a fresh financial start.
Trust in Experience
Expert Business Bankruptcy Guidance
With over 30 years experience as a business bankruptcy lawyer in Tyler, TX, Richard Hughes is dedicated to protecting your business interests throughout the bankruptcy process. Whether you're facing mounting debts, creditor actions, or the need to restructure your business, Richard Hughes has the experience and understanding to guide you toward the best possible outcome.
Tailored Bankruptcy Strategies for Businesses
At Richard Hughes Law Firm, we recognize that every business is unique. Richard Hughes will work closely with you to develop a tailored bankruptcy strategy that aligns with your specific needs and goals.
Whether you require Chapter 7 liquidation or Chapter 11 reorganization, Richard Hughes will provide the guidance and representation necessary to navigate the complexities of business bankruptcy law.
Protecting Your Business Assets and Interests
As your trusted business bankruptcy lawyer, Richard Hughes will explore every available avenue to minimize the impact on your business operations and help you emerge from bankruptcy with a solid foundation for future success. With his extensive knowledge of business bankruptcy law and his skillful negotiation and advocacy, Richard Hughes is the advocate your business needs during this challenging time.
Contact Richard Hughes Law Firm
Ready to take control of your business's financial future? Contact Richard Hughes Law Firm today to schedule a consultation. We will be your trusted partner in navigating the complexities of business bankruptcy and guiding you toward a fresh start. Call now to take the first step towards business recovery with Richard Hughes Law Firm.
Business Bankruptcy FAQs
What’s the difference between Chapter 7 and Chapter 11 bankruptcy?
Chapter 7 and Chapter 11 bankruptcies are designed to allow for businesses to discharge debts.
Chapter 7 involves the liquidation and termination of a business entity. A trustee is assigned to liquidate the company’s assets and the proceeds are used to pay debts.
Chapter 11 bankruptcy is a “restructuring” of a company’s debts, allowing the company to reject leases, pay tax obligations over time, sell unneeded assets, and more. Unlike a Chapter 7 bankruptcy, the debtor retains ownership of the business.
What is Chapter 7 Bankruptcy?
Chapter 7 bankruptcy is a traditional business or corporate bankruptcy. The business is liquidated to pay as many of the creditors as possible and then the owner’s further debts are discharged.
A Chapter 7 bankruptcy is overseen by a “trustee” appointed by the court. The trustee will manage the liquidation and represent the interests of creditors.
Do I have to qualify for Chapter 7 bankruptcy?
Yes. There are income requirements for Chapter 7 bankruptcy. If you make too much, you won’t be able to qualify for it.
The courts really want to ensure that creditors get their money back, so a debtor who is able to fund a Chapter 13 repayment plan must do that instead of filing for Chapter 7 bankruptcy.
Typically speaking, if your income is below the median income for your area, you’ll probably qualify for Chapter 7, but a judge can always require you file Chapter 13 if you have sufficient funds to do so–regardless of income.
What is a “means test”?
A means test will determine if you qualify for Chapter 7 bankruptcy. The “means” being tested here are your finances. It includes a formula that courts will use to determine your eligibility.
There are free calculators available online to see if you pass the means test.
Will Chapter 7 wipe out all of my debts?
Chapter 7 will wipe out most of your unsecured debts. However, it won’t wipe out
- Past-due child support
- Student loan payments
- Recent debts for luxury goods
- Debts incurred via fraud (like bad checks)
- Some tax debts
Can I keep my home in a Chapter 7 bankruptcy?
If your home equity is exempt from Chapter 7 bankruptcy–meaning that you’re current on your mortgage payments–you’ll be able to keep your home.
If you’re behind on your mortgage, it will be liquidated. In Texas, our homestead exemption protects your home or use its equity to pay debts.
How will Chapter 7 affect my credit?
Yes. All bankruptcies will affect your credit scores and the change will be pretty radical. That being said, it will only be on your credit for 10 years, and there’s a lot of things you can do in the meantime to get your credit back up.
What is Chapter 11 Bankruptcy?
Chapter 11 is a type of bankruptcy that allows an individual or business entity to reorganize their debt while receiving protection from creditors.
Who can file for Chapter 11 bankruptcy?
Almost anyone can file for Chapter 11 bankruptcy. There’s no debt or income restrictions on Chapter 11, and individuals, partnerships, incorporated entities, and others may file.
Chapter 11 is often the most complicated form of bankruptcy, and that’s why it’s mostly used by business entities rather than individuals.
Are there income requirements or restrictions for Chapter 11?
No. Unlike Chapter 7 bankruptcy, Chapter 11 is available to most businesses and individuals.
CWhat happens when a business files for Chapter 11?
Once you file Chapter 11, proceedings will begin to ensure that you’re reorganizing your business in order to pay back your creditors.
This includes being assigned a trustee to act on behalf of those creditors.
The court will issue an Automatic Stay on all debts, giving you time to liquidate assets or otherwise rearrange your business so you can pay your creditors
What is an “Automatic Stay” in Chapter 11 Bankruptcy?
Whenever you file for Chapter 11, the court will issue a stay to your creditors. This means that they cannot continue to attempt to collect on your debt. They have to wait for the bankruptcy process to conclude.
What does it mean to “reorganize” business debts?
In Chapter 11 bankruptcy, debts are “reorganized.” That can mean a few things, but in general it’s a way to lower the overall burden the debt causes.
This can be done by liquidating some assets and paying off debts, or by negotiating with a creditor to reduce monthly payments and pay back the debt over a longer period of time.
For businesses, it enables you to continue running your business throughout the bankruptcy and afterward.
Will I retain control of my business after Chapter 11?
Yes. You’ll retain control of your business during and after filing for Chapter 11 bankruptcy.
Of course, the trustee will be able to exert some authority over your assets, you’ll remain in charge of daily operations and business decision-making.