There can be several reasons behind filing for bankruptcy. It can be to stop banks from foreclosing your property or any other reasons for which a company needs to file for bankruptcy. In contrast, it’s sometimes better to wait and take an individual voluntary arrangement which can be a better alternative.
No matter what’s the situation, it’s always advisable to take help from a bankruptcy attorney who can help you to take the right steps. In this guide, you will know about the probable reason for which a company might need to file for bankruptcy.
Reasons Why A Company Need to File For Bankruptcy?
The article covers some possible reasons, but it doesn’t include all the reasons. Here is a quick review of all the reasons; read the full article to understand them clearly.
- Bank Is Foreclosing on Your Home
- Lender Wants to Repossess Your Car
- To Stop a Lawsuit
- You Expect to Receive Property Soon
- You Started a High Paying Job
Although these are some possible reasons, you can consult an experienced Alpharetta GA Bankruptcy Attorney who can help you if your reason is not listed in this article. Now, let’s discuss every reason in detail.
1. Bank Is Foreclosing on Your Property:
Are you in foreclosure? If yes, you can stop it by filing for bankruptcy. When you file for bankruptcy, your lenders and creditors cannot proceed with foreclosing on your property. After you file for bankruptcy, the law prohibits banks and creditors to foreclose your properties.
However, it’s important to understand chapter 7 and chapter 13 when you want to stop foreclosing your property. You should consult a reputable Alpharetta GA Bankruptcy Attorney who has the right knowledge and expertise to guide you.
2. Lender Wants to Repossess:
When lenders want to repossess your collateral, you can stop them from doing it by filing for bankruptcy. Educate yourself about chapter 13 and how you can catch up on your property if the lenders repossessed your collateral recently.
A reputed bankruptcy lawyer can help you better understand your situation and how you can stop the lenders from repossessing your collateral. Don’t try to handle things on your own; you might need legal advice, which can be useful for your case.
3. To Stop a Lawsuit:
Another crucial reason a company may choose to file for bankruptcy is to stop a lawsuit. Since lawsuits can cause a bad reputation for the company, a business owner would never want to go through court proceedings.
So, it’s a wise step to stop a lawsuit by filing for bankruptcy. As a business owner, it’s always a good idea to hire a business lawyer from the very beginning who can proactively take necessary steps.
4. You Expect to Receive Property Soon:
If you expect to receive certain property soon, you can file for bankruptcy. It could be a possible reason for which business owners might want to file for bankruptcy because they want to obtain ownership of certain properties. So, it can also be a possible reason that the company wants to file for bankruptcy.
5. Your Landlord is Evicting You:
A business owner may also want to file for bankruptcy because the landlord is evicting him/her. Although filing bankruptcy can stop most evictions, it cannot be for a long time.
Here you need to ensure that the landlord has not obtained possession from the court. Possession from the court means an eviction order from the court. Since the landlord has already taken an order from the court, bankruptcy can’t help in this situation.
Hopefully, the above information has helped you to understand what are the different reasons a company might need to file for bankruptcy. Learn about the role of a bankruptcy lawyer and how he/she can help you when you’re planning for filing bankruptcy. Lastly, please don’t forget to share if your situation is not mentioned in this post.