The Small Business Reorganization Act was enacted in March 2020 and added Subchapter V to Chapter 11 of the Bankruptcy Code. Subchapter V Bankruptcy provides a streamlined process for small business to get a Plan of Reorganization approved over the objections of creditors. Because the process is streamlined, it is more affordable than the typical Chapter 11 Bankruptcy.
Subchapter V requires the debtor to submit a Plan of Reorganization within 90 days of filing. This Plan of Reorganization(which lasts 3 to 5 years) can restructure loans through lower interest rates, longer amortization schedules, reducing principal balances, and even eliminating certain debts. While a Trustee is assigned in a Subchapter V Bankruptcy, the debtor retains control of the assets and operations.
Bill Kroll worked as a law clerk in the Bankruptcy Court for the Eastern District of North Carolina, is a Board Certified Specialist in Business and Consumer Bankruptcy, and has focused his practice on bankruptcy since 2009. If experience is what you are looking for, call EGH to schedule your free consultation
Phone: (919) 755-0025