Chapter 11 Bankruptcy

Chapter 11 BankruptsyWho can File: Individuals and Businesses

Best Suited to: Businesses that seek to continue operations but have a significant amount of unsecured or junior secured debt. Individuals in the middle to upper income range that do not qualify for a Chapter 7 or 13 because of ineligibility due to excessive income or excessive assets/liabilities.

Pros: Very flexible. No debt limits, no income requirements. Usually the debtor will retain the property as debtor-in-possession. Gives the Debtor some “breathing room” to reorganize. Unsecured debts can be discharged, and secured liens modified, crammed down, or even stripped off.

Cons: Expensive and complicated, and requires a significant commitment of time from the attorney and the debtor. Involves numerous court filings.Will require the employment of professionals to assist in the administration of the case. There are quarterly accounting fees paid to the US Trustee. These cases should have significant advance planning. Powerful creditors, such as first lien holders or large-position unsecured creditors, can make plan approval difficult if the relationship is highly adverse at the time of filing. Single-asset real estate cases are VERY difficult to achieve reorganization because of the enormous leverage of the first lien holder and the limited number of other creditors. “New value” may be required in some instances, meaning that the debtor may need to secure financing to fund the reorganization.

Time Line: Nearly every Chapter 11 is unique. If successful, most are confirmed within a year, and most have repayment plans that range between 3 and 10 years.

Attorney Fee: $15,000+ (depending on time incurred)
Filing Fee: $1,717
Expenses: Varies
Financing Options: Yes, part of the accrued fees can be paid with future income


Florida Chapter 11 bankruptcy can be filed by individuals or businesses and offers a flexible approach to restructuring debt. This type of case permits the Debtor to retain control of its property while reorganizing debts in an attempt to maximize value to the debtor and its creditors. Creditors are sometimes represented by committee and are given the opportunity to approve or reject the restructuring via a vote.

For more information, go to Bankruptcy FAQ


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