Sacramento Bankruptcy Law Blog

In the current economy, uncertainty about the future is a common concern. This is especially true for business owners. Small changes in the economy can substantially affect an owner's ability to pay creditors. It does not take many missed or late payments to creditors before a business can fall very behind and face significant economic challenges. In some situations, a business owner is unable to catch up with creditors and must consider other options such as Chapter 7 bankruptcy to stop creditor harassment.

An company that helps support charities has filed for Chapter 7 bankruptcy protection. The company, sharingspree.com, allegedly owes clients thousands of dollars. The company filed for bankruptcy protection after a court ordered the owner to pay over $400,000 to an investor.

The recent economic situation has led many Americans to have to examine their finances and make changes. In some cases, minor changes to a budget will not be enough to drastically change someone's financial situation. In these cases, one of the only options left is to file for bankruptcy. There are two types of bankruptcy: Chapter 7 and Chapter 13.

Fortunately, the economy has begun to turn around. Also, Americans are aware of the economic situation and have made changes to prevent being in a situation where bankruptcy is the only solution. This has led to a decrease in bankruptcy filings over the last three years by 30 percent. Surprisingly, the largest drop has come in states that were hit the hardest by the downturn.

After the chapter 7 petition has been filed, the court will set a date for the meeting of creditors (also called the 341 meeting). At this meeting, the trustee and the debtor's creditors have a chance to question the debtor. The trustee will generally ask questions like whether the information provided in the petition and schedules is accurate, whether the debtor has any lawsuits he can file against anyone, and whether the debtor has money coming to him, perhaps from something like a will or trust. The trustee will basically be trying to figure out the general financial condition of the debtor's estate, as well as whether the debtor is eligible for a discharge (if a debtor files with an attorney, it is likely the attorney will have already asked the debtor similar questions, so answering them shouldn't be too difficult).

Running a business can be a difficult thing, and many businesses face financial troubles at one time or another. Even businesses that some might think are immune to financial pressures can end up in financial trouble.

Some might think that being a doctor can make you immune from financial troubles, but even doctors sometimes need to seek bankruptcy protection. In fact, there has been an increase in chapter 11 bankruptcy filings by physicians recently. The economy, as well as regulations, malpractice insurance, and other costs of doing business, can combine to make it difficult for a physician's practice to survive.