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Chapter 11 can give a fresh start to a struggling business

Running a small business in Massachusetts can be a risky way to make a living for some. A drop in sales, the appearance of new competition or an unexpected event like the loss of a lease can cause things to go south very quickly. When this happens, many business owners will do everything they can, including investing more of their personal funds, to keep the business afloat. Unfortunately, in many cases the end result is just more debt.

Excessive debt can be a nightmare for a small business, and at the Law Offices of Kenneth E Lindauer, we understand what a difficult situation that can be. Income that could be invested in new equipment or inventory is instead used to pay interest and principal on debt. Creditors may be harassing the business owner and threatening repossession of secured collateral. The business's ability to continue may be threatened.

A Chapter 11 business reorganization could provide a fresh start to a business faced by overwhelming debt. In a Chapter 11 bankruptcy, the business and creditors agree on a repayment plan and a reorganization strategy, which are submitted to the court for approval. The owner maintains possession of the business while the bankruptcy case is proceeding. When the requirements of the plan have been met, dischargeable debt is eliminated.

Chapter 11 reorganizations can be complicated and generally require the assistance of an experienced business bankruptcy lawyer. At the Law Offices of Kenneth E Lindauer, our legal team has been providing legal services to North Shore business owners for over 37 years. For more information, visit our web page. This could provide general information about Chapter 11, helping business owner take proper action.

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