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Chapter 11 Bankruptcy

Experienced Representation for Individuals & Small Businesses in NY

Chapter 11 bankruptcy is a debt reorganization process that is most often used by businesses that want to continue doing business and repay its debts at the same time. In addition, it benefits individuals who don’t qualify for other chapters or need certain protections Chapter 11 offers. Overall, Chapter 11 is more expensive and complex than other types of bankruptcy, but it can offer significant advantages if you qualify.


If you or your business is steeped in debt, it is vital for you to gain an understanding of your bankruptcy options. With qualified guidance, you may be able to use Chapter 11 bankruptcy to reduce dischargeable debt, get creditors and collection agencies off your back, and move forward into the future with a clean slate.

What Is a Chapter 11 Bankruptcy?

Chapter 11 involves a reorganization of debt. As a business owner, you can use this type of bankruptcy to:


  • Continue operating your business

  • Stop pending lawsuits and collection actions

  • Reduce and restructure debt, potentially over the objections of your creditors

  • Catch up on rent and other bills

  • Avoid liquidating certain assets


Once the filing takes place, creditors can no longer attempt to collect your debt because of the automatic stay. This is an order issued by the bankruptcy court that freezes all collection actions.

After you file, you will have four months to create a reorganization plan (the “Plan”), which will show how you will continue business operations while meeting your financial obligations. In some cases, large businesses may be allowed up to 18 months to create such a Plan.

Your Path to Financial Freedom Begins Here

Too deep in debt to see a way out? Contact us at (914) 600-7161 for a free consultation. We can help you determine whether bankruptcy is right for you.

The Plan may include:

  • Reducing expenses by downsizing

  • Selling certain assets

  • Modifying loans or mortgages, such as extending the terms or reducing the interest rate


The Plan will also categorize each of your creditors into a certain class, such as unsecured, secured, and priority. In most cases, creditors are allowed to vote on the Plan for it to be approved by the bankruptcy court.


Advantages of Chapter 11 Bankruptcy

If you or someone you know is facing financial struggles as a business owner, it is important to know you have options.


Some benefits of Chapter 11 bankruptcy include:

  • The business can continue to operate while paying off debts

  • Chapter 11 bankruptcy lets debtors partially pay back unsecured debts

  • Debtors may be able to temporarily defer making certain rent or installment debts

  • Adjustment of interest rates

  • Debtors in chapter 11 reorganization may be able to borrow money while in reorganization to finance their reorganization

  • The automatic stay judgment gives you freedom from harassing creditors contacting you at home or at your business

  • Freedom to restructure secured debts where payments can be lower and spread over a longer period.

Individual Chapter 11 Bankruptcy

Chapter 11 may be beneficial for individuals who do not qualify for Chapter 13 or who do not wish to lose assets through Chapter 7.  Unlike Chapter 13, Chapter 11 does not limit the amount of debt you can owe. Some of the people who benefit most from Chapter 11 are celebrities, professional athletes, and real estate investors.


At The Law Office of James J. Rufo, I have devoted nearly a decade to helping people and businesses accomplish these goals in White Plains and surrounding areas. You deserve our level of experience, extensive knowledge of bankruptcy law, and involvement in your case from start to finish.

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