When you are facing bankruptcy, one of the biggest decisions you will have to make is what to do with your business. You may be tempted to just shut it down and walk away, but there is a better option. You can sell your business as an asset in your bankruptcy and a bankruptcy lawyer can help guide you. This can provide you with a fresh start and allow you to keep your business alive.
What is a business asset in bankruptcy?
A business’s assets are usually among the first things to be evaluated in a bankruptcy proceeding. The goal is to identify and liquidate all the company’s assets in order to repay as many creditors as possible. While some assets may be more obvious, such as inventory or equipment, others may not be so clear.
A bankruptcy occurs when an individual or company cannot repay their debts as they become due. The assets of the company are used to repay these debts. Most bankruptcy lawyers know that bankruptcy law allows for the sale of these assets to repay as much of the debt as possible. Chapter 7 liquidation is the most common type of bankruptcy, and it involves the sale of all non-exempt assets. This type of bankruptcy allows for a fresh start for the debtor.
Businesses can also file for Chapter 11 bankruptcy, which results in the reorganization of the company’s assets in order to make it more profitable and allow it to continue operating. Exempt assets are those that cannot be liquidated to repay creditors.
How can you sell your business as an asset in bankruptcy?
There are a few ways to go about selling your business as an asset in bankruptcy. The most common way is through a Chapter 11 bankruptcy. In this type of bankruptcy, the company files for bankruptcy and creates a plan to reorganize its assets. This plan is approved by the bankruptcy court and allows the company to continue operating. As part of this plan, the company can sell its assets to repay creditors.
Another way to sell your business as an asset is through a Chapter 13 bankruptcy. In this type of bankruptcy, the debtor creates a repayment plan that must be approved by the bankruptcy court. The repayment plan will have a schedule of payments that will be made to the bankruptcy trustee, who will then distribute the funds to creditors. This type of bankruptcy is usually used by individuals with regular income who want to keep their assets.
The best way to sell your business as an asset in bankruptcy is through a Chapter 11 bankruptcy. This type of bankruptcy allows the company to continue operating and sell its assets to repay creditors. It is important to work with a bankruptcy lawyer to create a plan that will be approved by the bankruptcy court.
The benefits of selling your business as an asset
Selling your business as an asset is a great way to receive a lump sum of money that can be used for various purposes, such as retirement, investments, or even starting another business.
Some people hesitate to sell their businesses because they think they will lose control over them. However, when you sell your business as an asset, you maintain control until the sale is complete. You also have the opportunity to choose the buyer who you think is best suited to take over your business.