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Tennessee has the highest number of personal bankruptcies

While Tennessee's economy is healthy, a recent report revealed that it also leads the nation in personal bankruptcy filings. From the beginning of April 2015 to the end of March 2016, Tennessee had the highest rate of personal bankruptcies in the United States at a rate of rate of 553 filings per 100,000 residents. The median for the same time period in the U.S. was 224 filings per 100,000 people.

Personal bankruptcy rates depend on several factors, including median income and consumer protection laws in the state. States with fewer consumer protections tend to see more bankruptcy filings, including filings to protect household goods and wages. Fortunately, there are several bankruptcy options that can help struggling consumers enjoy a fresh financial start and future.

Tennessee-based restaurant chain files for Chapter 11 bankruptcy

Business bankruptcy is available to provide helpful options for companies seeking to return to a successful history. A Tennessee-based restaurant recently announced it was filing for bankruptcy and closing 18 of its 25 restaurants in Tennessee. The plan to close underperforming restaurants is part of an overall plan to improve the financial performance of the restaurant chain. The company filed for Chapter 11 reorganization bankruptcy. The parent company for the restaurant chain has secured $25 million in bankruptcy financing for the restructuring plan.

The restaurant chain had a difficult first half of 2016. Foot traffic for the chain fell by nearly 9 percent and sales fell by 4 percent. As of last October, the restaurant chain had $525.4 million in liabilities and $12.9 million in cash. The bankruptcy filing provides that the restaurant chain has 25,000 creditors, $416 million in debts and an estimated $100 million to $500 million in assets. The restaurant chain also operates restaurants in other states.

What are Chapter 7 bankruptcy exemptions?

If you are considering Chapter 7 bankruptcy, you may be concerned about what the liquidation process entails. In general, Chapter 7 bankruptcy is considered a liquidation bankruptcy for those who qualify to liquidate non-exempt assets to repay debts and enjoy a fresh financial start. Because of the importance of bankruptcy exemption protections, you may wonder what they are, what they mean and how they may impact your bankruptcy process.

The idea of bankruptcy can create some uneasiness and concerns related to a home, car or other assets. It is important to understand that, although the bankruptcy process provides a fresh financial start, it does not necessarily mean starting from scratch following it. Bankruptcy exemption protections are an important part of the bankruptcy process designed to protect the filing party and some categories or property they may own. For instance, homes and cars enjoy bankruptcy exemption protections but are subject to certain value limits or caps. Personal property, including clothing, jewelry, home furnishings and other items, may also be exempted but sometimes value limits may also apply.

Bankruptcy options can help stop wage garnishment

Being overwhelmed by debt is stressful enough but added stress and strain because of wage garnishment may feel unbearable to individuals struggling with debt. Wage garnishment occurs when a creditor has filed a lawsuit to recover a debt and has successfully obtained a judgment against the party owing the debt. Once the judgment is in place, and their wages are being garnished, the party owing the debt may face increasingly difficult struggles paying their bills and keeping up on their debts.

It is important for individuals struggling with debt to understand that different options may be available through the legal process to help them, including with wage garnishment. Bankruptcy may be one option to consider. Bankruptcy can be helpful in several ways but after a bankruptcy petition is filed, an automatic stay can help stop creditor collection actions. This can stop creditor actions from proceeding or any new ones from beginning altogether. Wage garnishment can be prevented, stopped and, in some instances, reversed.

Help avoiding foreclosure through the bankruptcy process

Protecting a family home from foreclosure is a serious and stressful concern for many families and homeowners, including in Tennessee. There are ways that the bankruptcy process may help. One option may be the Chapter 13 bankruptcy process that, in addition to helping struggling individuals reorganize their debt, can also potentially provide options to help avoid foreclosure.

For individuals with overwhelming debt burdens, the daily stress can be significant. The Chapter 13 bankruptcy process may be available to individuals who have a reliable source of income to enjoy relief from foreclosure and relief from debt. The Chapter 13 bankruptcy process allows a filing individual to reorganize their debt into more manageable payments so that they can repay their debts according to a repayment plan developed with the help of the bankruptcy court and approved by the bankruptcy court.

What is Chapter 7 bankruptcy?

Chapter 7 bankruptcy is a bankruptcy option for individuals who qualify. You may have heard of Chapter 7 bankruptcy but wondered who qualifies and how you file for Chapter 7 bankruptcy. To file for Chapter 7 bankruptcy, the filing party must file a bankruptcy petition and also provide a schedule of assets and liabilities, a schedule of income and expenditures, a statement of their financial affairs and a schedule of executory contract and leases that have not expired. A copy of the filing party's most recent tax return must also be provided.

Additional documentation is required from filing parties with primarily consumer debts. The court uses the means test to determine if the filing party qualifies for Chapter 7 bankruptcy which provides that their income is equal to, or less than, the median income in their state. Once the filing party has filed for bankruptcy, an automatic stay goes into effect that prevents creditors from pursuing any collection actions during the bankruptcy process.

Tennessee leads country in personal bankruptcy

This blog recently discussed the business bankruptcy of a Tennessee company, however, Tennessee led the country in personal bankruptcy filings during 2015. There were a total of 36,052 bankruptcy filings in Tennessee in 2015 which is twice the average number of bankruptcy filings throughout the nation. Unfortunately, factors that contribute to this include that Tennessee can be friendly to creditors, allowing them to quickly garnish wages or foreclose on a house.

In Tennessee creditors are able to obtain judgments, such as for a credit card debt, and garnish wages. In addition, foreclosure is not a judicial process in Tennessee so creditors are able to more quickly foreclose on a property. The bankruptcy process can slow creditors and provide help to struggling consumers. Once bankruptcy is filed for, an automatic stay is entered that prevents creditors from proceeding with collection actions while the bankruptcy process is proceeding.

Bankruptcy for Tennessee company approved

This blog has recently discussed, in particular, how business bankruptcy options may help struggling business and professionals in Tennessee. The recent approval of the bankruptcy reorganization plan for a struggling papermaking company headquartered in Tennessee is a good example of how the bankruptcy reorganization process can be helpful for a struggling company. The company is the largest coated paper producer in North America.

The company, which filed for Chapter 11 bankruptcy protection earlier in the year, now must only follow its approved reorganization plan and its debts that existed prior to the bankruptcy will be discharged. The company, with approximately 500 employees, reported $2.4 billion in debt in the bankruptcy. It had reported similar revenues in the year prior to the bankruptcy. According to the plan, creditors will receive shares of stock instead of cash repayment. The company listed 30,785 creditors in its filing.

How Chapter 11 bankruptcy actually works

This blog recently discussed the way business bankruptcy can help struggling businesses and professionals. A closer look at Chapter 11 bankruptcy may help business owners, professionals and others seeking debt relief better understand how bankruptcy may be an option to consider. Chapter 11 bankruptcy provides an option for businesses with heavy debt burdens to reorganize debts.

Chapter 11 business bankruptcy allows businesses to develop a plan to return to profitability following a bankruptcy through measures that may include trimming costs and seeking to generate new sources of income and revenue. The process also provides relief from creditors while the process is progressing. Once a Chapter 11 petition has been filed, an automatic stay is put into place to prevent creditor actions. The business, however, continues to operate as a reorganization plan is developed to repay creditors.

Bankruptcy options can help businesses and professionals

Businesses are not immune to challenging financial times. A decline in sales and profits, as well as tax challenges, may present significant difficulties for a number of companies struggling to stay in business. Business and commercial bankruptcy options are available to help struggling businesses and professionals faced with tough economic times or other financial challenges. Whatever led to the circumstances the business or professional is facing, reorganization bankruptcy options may be available to help them through it.

Chapter 11 bankruptcy is a reorganization option that can provide a business with the option to remain in business and to become profitable once again. Many businesses are able to remain in business during the Chapter 11 bankruptcy reorganization process by meeting the financial obligations according to the bankruptcy reorganization. Chapter 11 bankruptcy provides a process to reorganize debts so that obligations can be met without having to close a business.

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