Bankruptcy isn’t a topic anyone would want to talk about. However, if you think your company is headed this way and you want to keep the fallout to a minimum, here’s what you need to know about Chapter 7 Bankruptcy law in PA:
What is Chapter 7?
This refers to a bankruptcy proceeding wherein the organization terminates all its operations and goes out of business, says Investopedia. Also widely known as straightforward bankruptcy. The court will then designate a trustee who will sell the assets and use those funds to pay off creditors. The Law Offices of David M. Offen can help you if you’re dealing with a bankruptcy on your hands.
Who gets paid?
Investors with the least risks or investments at stake, like secured creditors, are typically paid first. Unsecured creditors follow, and then investors. This is the hierarchy of absolute priority companies must follow.
Are there any conditions?
You will be allowed to file for Chapter 7 Bankruptcy in PA only if you haven’t filed any in the last 6 to 8 years. You will need to provide the court with information about your finances before you can proceed.
Will all my debts be discharged?
Most will be. However, debts that involve alimony and child support along with student loans and some taxes will not be a part of those discharged debts. Also, if you owe the government money for overpayment of benefits like SNAP, those debts will not be discharged as well.
Do I need a lawyer?
You will need to hire a competent and experienced bankruptcy attorney to help you. Preparing and filing for bankruptcy involves a ton of legal paperwork. You might also want to consider asking a Chapter 13 Bankruptcy lawyer for additional legal advice and help so you have a better picture of your options.
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