Orange County Chapter 11 Bankruptcy Attorneys
Practice Areas
Debt Relief Under Chapter 11 Bankruptcy California
If you’re a business owner or an individual facing overwhelming debt, the experienced Orange County, CA Chapter 11 bankruptcy attorneys at Marshack Hays Wood can help you explore your options for regaining control of your financial affairs. Our firm has extensive experience helping business debtors and individuals reorganize debt while protecting their assets and operations.
Our attorneys work closely with clients to develop a customized repayment plan that aligns with their best interests, ensuring a path toward long-term financial stability. Contact Marshack Hays Wood by calling (949) 333-7777 or reach out online today to discuss how Chapter 11 bankruptcy can provide the debt relief and restructuring solutions you need.
What is Chapter 11 Bankruptcy in California?
Chapter 11 bankruptcy, known as reorganization bankruptcy, allows businesses to restructure debt while continuing daily business operations. Unlike liquidation, Chapter 11 gives companies the chance to propose a reorganization plan that protects their assets and enables them to operate under court oversight while working toward financial recovery. Business management typically remains in control, though all decisions are subject to legal review and creditor input.
While individuals can file Chapter 11, it’s most appropriate when they have high-value assets or income that disqualifies them from Chapter 13. However, whether the filer is a business or individual, timing and strategy matter.
Before filing for bankruptcy, it’s important to discuss your options with a bankruptcy attorney. At Marshack Hays Wood, our Orange County bankruptcy attorneys have over 75 years of combined experience helping individuals and businesses navigate the ins and outs of every Chapter 11 matter in the Southern California region. Call us today to discuss how we can help protect your operations and move forward with confidence.
Who Can File Chapter 11 Bankruptcy in California?
Under the U.S. Bankruptcy Code (§§ 1101 – 1195), nearly any person or business entity can file for Chapter 11 bankruptcy in California. This includes corporations, partnerships, LLCs, and high-income individuals with debts that exceed the limits for Chapter 13. Eligibility is not restricted by income level, but filers must be able to propose a feasible individual or business reorganization plan and demonstrate the ability to meet future obligations.
It’s important to note that individuals who have had a bankruptcy dismissal within the last six months are also not eligible to file for Chapter 11.
Personal Bankruptcy and Chapter 11
Individuals who choose to file a Chapter 11 bankruptcy typically do so because they want to retain control of their assets and avoid liquidation, unlike in Chapter 7 cases, where assets are typically liquidated. They might also exceed the debt limits set for Chapter 13 bankruptcy, meaning they have too much secured and unsecured debt to qualify under that chapter. Chapter 11 offers these individuals a way to reorganize their finances while maintaining ownership of valuable property and creating a manageable restructuring plan.
Business Bankruptcy and Chapter 11
Businesses filing for Chapter 11 bankruptcy are allowed to continue normal operations, which helps preserve revenue and maintain relationships with employees, vendors, and customers. However, they must obtain court approval before making significant decisions, such as selling assets, entering new contracts, or incurring additional debt.
If you’re a business owner looking to restructure debt while safeguarding valuable assets, our California business bankruptcy attorneys are equipped to handle even the most complex cases. Call today.
Chapter 11 Subchapter 5
Chapter 11 Subchapter V (Subchapter 5) is a streamlined option under the Bankruptcy Code designed specifically for small businesses seeking debt relief without the usual cost and complexity of traditional Chapter 11. This process allows business owners to maintain control of daily operations while proposing a simplified reorganization plan.
Available to qualifying businesses with secured and unsecured debts under a certain threshold, Subchapter V eliminates some of the burdensome requirements of standard Chapter 11, such as the need for a creditors’ committee or a disclosure statement. For companies facing financial hardship but aiming to stay in business, Chapter 11 bankruptcy in California under Subchapter V can be a more efficient and affordable solution.
At Marshack Hays Wood, our small business bankruptcy lawyers guide clients through every step of the Subchapter V process to help protect their business and secure long-term financial stability.
Benefits of Filing Chapter 11 Bankruptcy in California
Filing for Chapter 11 offers many benefits to both businesses and qualifying individuals in California, including:
- Automatic Stay Halts Lawsuits, Foreclosures, & Collection Actions
- Businesses Can Continue Operations & Generate Revenue
- Customized Reorganization Plan Tailored to Your Financial Circumstances
- Debtors Will Retain Control of Assets
- Flexibility in Debt Repayment & Potential to Modify Secured Loans
Are There Downsides to Chapter 11?
Chapter 11 does have some potential downsides. It can be complex, time-consuming, and costly, especially compared to other bankruptcy options. Debtors must comply with detailed reporting requirements, court oversight, and creditor negotiations, which may require significant legal and financial resources. Additionally, success depends on the viability of the proposed reorganization plan and the debtor’s ability to follow through with payments over time.
How Does Chapter 11 Bankruptcy Work in Orange County?
When a business or high-debt individual files for Chapter 11 in Orange County, the case is handled through the Santa Ana Bankruptcy Court, part of the Central District of California. The process begins when the debtor files a petition, along with detailed schedules outlining their assets, liabilities, income, expenses, and a list of unsecured creditors. Upon filing, the bankruptcy court issues an automatic stay, which immediately stops collections, lawsuits, foreclosures, and other creditor actions. This legal protection allows the filer (known as the debtor in possession) to maintain control over their business and property while working on a path toward financial recovery.
The core of a Chapter 11 case is the reorganization plan, which outlines how the debtor in possession will restructure debts and make payment arrangements to various classes of creditors. In many cases, the debtor must also file a disclosure statement, which gives creditors enough information to evaluate the proposed plan. Creditors may vote on the plan, and the court must approve or “confirm” it by determining that the plan is feasible, proposed in good faith, and in the best interests of the creditors. Once confirmed, the plan governs how future income is used to pay off claims over time.
Chapter 11 Repayment Plan
The debtor typically has up to 18 months to propose a reorganization plan in a Chapter 11 case. If they don’t submit one within that time, creditors may step in and propose their own. The creditors’ committee must review the plan, and once a majority agrees, the court must determine if the plan is feasible.
If approved, all taxes must be paid within five years, and the plan must prioritize the interests of creditors. Experienced California Chapter 11 lawyers like those at Marshack Hays Wood play a key role in guiding the process from proposal to confirmation.
Additional California Chapter 11 Bankruptcy FAQs
What is the Difference Between Chapter 7 and Chapter 11?
The main difference between Chapter 11 and Chapter 7 bankruptcy in California lies in how debts are handled. Chapter 7 involves liquidation, which is essentially the selling of nonexempt assets to pay both unsecured and secured creditors back and is typically used by individuals or businesses closing down. In contrast, Chapter 11 is a reorganization process that allows businesses (and some individuals) to restructure their debts while continuing to operate.
What is the Difference Between Chapter 11 and Chapter 13?
Chapter 13 is designed for individuals with regular income and lower debt levels, offering a simplified process with a set repayment plan over three to five years. Chapter 11, on the other hand, is more complex and is primarily used by businesses or individuals with significant assets and high liabilities that exceed California Chapter 13 bankruptcy limits.
Overall, Chapter 11 offers greater flexibility but involves more court oversight, creditor involvement, and legal complexity.
Can a Judge Deny My Chapter 11 Petition?
Yes. A bankruptcy judge may deny your Chapter 11 petition due to the following reasons:
- There is already a similar filing in place that has been dismissed.
- Failure to appear at the initial court hearing.
- Failure to undergo credit counseling within the 180-day window.
How Much Does it Cost to File Chapter 11 in Orange County?
The bankruptcy court filing fee for a new Chapter 11 petition is $1,738. This fee applies across the Central and Southern Districts of California, including the Santa Ana Bankruptcy Court in Orange County. You can expect attorney fees to range significantly, typically from $15,000 to $50,000 or more, depending on the case’s size and complexity.
These legal fees reflect the substantial paperwork and administrative work, creditor negotiations, and ongoing reporting required in a Chapter 11 case.
How Long Does Chapter 11 Bankruptcy Take?
The length of a Chapter 11 case can vary widely depending on the complexity of the case, the time it takes to complete a viable reorganization plan, and the nature of any creditor disputes.
Remember, though, that the business or individual filing for Chapter 11 bankruptcy has up to 18 months to submit the reorganization plan before the creditors file their own proposed reorganization plan.
The repayment portion of Chapter 11 has no real time limit, other than it can last for years. Usually, the payoff period lasts up to five years, though there are some circumstances where the repayment process is much shorter.
How Can Bankruptcy Lawyers in Orange County Help Me?
Your Orange County bankruptcy lawyers can help you evaluate your financial situation, determine the best chapter to file under, and guide you through the complex requirements of California Bankruptcy Law.
They will work closely with you to develop a feasible reorganization plan, ensure it complies with bankruptcy court rules, and help negotiate with creditors to reach terms that are legally sound and fair. Experienced law firms also bring the resources and strategic insight needed for a successful reorganization, helping you regain control and move forward with confidence.
Why Hire an Experienced Chapter 11 Lawyer at Marshack Hays Wood?
When faced with a troublesome financial situation, choosing the right legal team can make all the difference. At Marshack Hays Wood, our experienced Chapter 11 bankruptcy attorneys understand the intricacies of Chapter 11 in California and are here to provide the strategic support you need to move forward.
As trusted Orange County Chapter 11 lawyers, we guide business owners, high-net-worth individuals, and professionals through every stage of the legal process, from filing to debt restructuring to plan confirmation and beyond. We also offer trusted guidance on everything from business contracts, litigation, and avoidance actions, to your rights and responsibilities as a debtor in possession.
Backed by decades of experience, our local bankruptcy law practice helps clients make informed decisions that protect their interests and lead to lasting solutions.
Areas We Serve in Southern California
Based out of Irvine, CA, our team serves clients across Orange County and the SoCal region, including Santa Ana, Huntington Beach, Anaheim, Newport Beach, Costa Mesa, Fullerton, Long Beach, Los Angeles, Riverside, San Bernardino, and all the surrounding cities and communities. If you’re ready to take the next step toward financial recovery, contact our office to schedule your initial consultation today.
Call for Professional Chapter 11 Bankruptcy Assistance in Orange County, CA Today
If you’re facing serious challenges and need a structured way to regain control of your finances, a Chapter 11 bankruptcy lawyer at Marshack Hays Wood can help you understand your options and develop a customized reorganization plan.
With extensive experience in bankruptcy law, our team is equipped to help you resolve complex debt issues, protect vital assets, and address any legal challenges that may arise throughout the process. We work to ensure you meet all your legal obligations so you can move ahead with confidence.
Let us help you complete your Chapter 11 bankruptcy filing with clarity and precision. For reliable legal protection and practical solutions you can trust, contact Marshack Hays Wood LLP by calling (949) 333-7777 or sending us a message online today.
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At Marshack Hays Wood, our attorneys provide the legal support you need to move forward with confidence. Let us help you take the first step toward financial stability.