How Can A Business Avoid Bankruptcy?
It is not hard to imagine why so many people consider bankruptcy as their first option when they find themselves in deep financial trouble. Harassing phone calls, and threatening letters can cause a great deal of stress.
How Can A Business Avoid Bankruptcy?Answer: If you are watching the news about businesses, including very large ones like Chrysler) going bankrupt, you may wonder if they could have avoided bankruptcy. Sometimes it is possible for a business to avoid Chapter 11 (reorganization) or Chapter 7 (liquidation). Here are some alternatives: Work out a deal with creditors In other words, set up a plan much as a bankruptcy trustee would do, and see if you can get creditors to accept it. No one wants to go to court necessarily, and creditors know that it will cost them if the debtor declares bankruptcy, so sometimes they are willing to settle for a “reasonable” percentage of what is owed to them. Of course, all it takes is one stubborn creditor to put the whole deal off, and the process is informal, and thus not binding on creditors. Find New Sources of
