What Are the Advantages of Chapter 11 Bankruptcy in New Jersey?
Chapter 11 bankruptcy in New Jersey is a legal process in which a New Jersey company can restructure its debt, discharge some unsecured debt and continue to operate. Chapter 11 is often referred to as “reorganization bankruptcy.” Chapter 11 bankruptcy allows a debtor company to obtain a relatively fresh start by forgiving qualified debts and creating a payment plan. Chapter 11 bankruptcy offers several advantages to New Jersey debtor companies. Automatic Stay Once a company files for Chapter 11 bankruptcy, the bankruptcy court will impose an automatic stay. The automatic stay bars any creditors from going forward with any collection efforts, including, but not limited to, foreclosure attempts, wage garnishment, vehicle repossessions and harassing telephone calls. If the debtor company is not eligible for Chapter 11 or has committed fraud, the creditors may move to dismiss the bankruptcy, which, if granted, terminates the automatic stay. In the alternative, if the court finds the compan
