May 28, 2017

Supreme Court Ruling on Lien Stripping

Despite the uptick in the housing market, millions of Americans owe more on their first and second mortgages than their homes are worth. When mortgage balances exceed the value of the home, the home is said to be "underwater." Sometimes the value of the home is sufficient to cover the balance of the first mortgage but not the second. The recent Supreme Court ruling on underwater second … [Read more...]

Chapter 11 or 13 for Troubled Businesses ?

This month news of an oil and gas producer filing for Chapter 11 bankruptcy protection made news. The reason cited for the financial difficulty is the drop in oil prices, which have have slid some 50 percent since June. My Chapter 11 clients own small to mid-sized businesses, but they have the same problems as bigger companies who need to reorganize under the orderly process of a bankruptcy … [Read more...]

Choosing a Chapter 13 Bankruptcy Specialist

Filing a Chapter 13 bankruptcy case isn’t as straightforward as a Chapter 7 case. I usually find that my Charlotte area clients who need Chapter 13 bankruptcy protection have complex issues to resolve including: Businesses and partnerships that need to be unwound or otherwise dealt with Unpaid tax liabilities with the state and IRS A number of mortgaged properties and other assets they … [Read more...]

Chapter 11 Bankruptcy Primer, Part 2 of 2

While Chapter 11 bankruptcy is not as frequently employed as Chapters 7 and 13 it is appropriate in some circumstances. This post, along with the first part in the series, will answer many frequently-asked questions about Chapter 11. I also recommend downloading my guide to Chapter 11 here. Q: What questions do I ask a prospective Chapter 11 client to determine whether they should “collapse … [Read more...]

Chapter 11 Bankruptcy Primer, Part 1 of 2

Chapter 11 bankruptcy cases by large corporations make the news more frequently than smaller companies using Chapter 11, leaving some business owners and nonprofit organizations like churches wondering whether Chapter 11 is an option for them. Chapter 11 is not as straightforward to explain as Chapter 7 or Chapter 13, so I wrote this white paper on Chapter 11 and designed this FAQ: Q: How … [Read more...]

Closing a Failed Business and Starting Another Like It

I have written this letter at various times to deal with the legal obstacles to closing an unprofitable business and getting a "fresh start" with another one. The primary legal obstacle is called "successor liability" [note]Dear (Business Owner): I understand that you have essentially been self-employed and wish to continue in the same line of work. I also understand that your present … [Read more...]

Reorganizing a Business with Chapter 11 Bankruptcy

My typical Chapter 11 client is a small to mid-sized, closely held and viable business with cash flow problems. The business offers either goods or services that are in demand,but needs to be reorganized in an orderly manner instead of haphazardly responding to creditor demands. The source of the financial problems varies; common problems include the decline of the housing market, growth and … [Read more...]

Charlotte’s Greater Salem Church Obtains Chapter 11 Bankruptcy Protection

I recently filed a Chapter 11 bankruptcy case to stop a foreclosure that was threatening a well known local church, demonstrating the power of the automatic stay. Chapter 11 is not just for businesses Greater Salem Church was threatened with the loss of its church building. The Chapter 11 filing caused the automatic stay to stop the foreclosure proceeding. This will allow the church membership … [Read more...]

Bankruptcy Counseling instead of Head in the Sand

I won't weigh in on the remedies prescribed by economist David Rosenberg here, but I salute the intelligence of his agreement with my comparison of our economy to a python that just took on a big meal. If you or your business are struggling financially, consulting with our offices might reveal coping strategies for you until better times emerge.  Putting your head in the sand and hoping for … [Read more...]

Chapter 11 Bankruptcy for a Healthy Turnaround

Yesterday General Motors  announced second-quarter profits that exceeded expectations and came as G.M. was putting the finishing touches on an initial public stock offering. This is good news from a company forced into Chapter 11 bankruptcy a little more than a year ago. According to Dow Jones Daily Bankruptcy Review, "After recent years of financial distress and bankruptcy filings, U.S.-based … [Read more...]