When you think of businesses filing for bankruptcy, you may likely think of small, family-owned boutiques and small businesses that could not compete with big name retailers. However, large corporations are certainly not immune from financial troubles, especially in this changing economic climate, and many large companies in and around New Jersey have filed for bankruptcy in recent years.
Notably, sports retailers Sports Authority and Vestis Retail Group, LLC (which runs Eastern Mountain Sports and Bob’s Stores) have announced bankruptcy filings and the closing of most–if not all–of their locations. Other large retailers that have filed for bankruptcy include clothing company Aeropostale, grocery stores Fairway and A&P, and bookstore giant Borders.
When Businesses File for bankruptcy
When a business decides it is time to file for bankruptcy, owners have different options depending on the circumstances of their business. For example, different bankruptcy filings may be appropriate whether you want to try to continue operations or close up shop.
In addition, the nature of the business debt and the assets of the business can influence the type of bankruptcy a business pursues. Businesses generally choose one of the following:
- Chapter 7 bankruptcy — This type of bankruptcy liquidates the assets of the business to pay creditors and discharges remaining debts, resulting in the closing of the business.
- Chapter 11 bankruptcy — Chapter 11 allows a business to reorganize debts so the business can make payments to creditors while remaining in operation if the owners so choose. The court will have a say in the way the business operates throughout the bankruptcy.
- Chapter 13 bankruptcy — This is another type of reorganization bankruptcy that is not available to all businesses. However, if the business is owned as a partnership or sole proprietorship, the owner can file for Chapter 13 and deal with both business and personal debts.
An experienced bankruptcy attorney can review your situation and help you determine which type of bankruptcy is right for your business and your particular financial circumstances.
Consult with a Bankruptcy Lawyer to Discuss your Options Today
Whether you are having financial problems with your personal or business accounts, you should not wait to discuss whether bankruptcy can help you with an experienced NJ bankruptcy attorney. The longer you wait, the more your financial issues can compound and the more complicated your case may be. At the Law Office of Michael Alan Siddons
, we help clients with bankruptcy cases throughout New Jersey, Maryland, and Pennsylvania, so please call us today at 610-255-7500.