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Chapter 11 Individual Filing:

A chapter 11 bankruptcy begins with the filing of a voluntary petition in the district in which the debtor resides or is domiciled. Similar to other chapters in bankruptcy, an individual filing for chapter 11 must complete the credit counseling course prior to filing their bankruptcy. The court filing fees associated with a chapter 11 is $1,717.00 – generally individuals filing under chapter 11 do so because they don’t qualify to file under a chapter 7 or 13.

Similar to other chapters of the bankruptcy code, the filing of a chapter 11 stays judgments, foreclosures, repossessions and most collections that arose prior to the filing of the case. A creditor seeking relief from the stay must petition the court and receive approval prior to taking any action.

The United States. Trustee’s office plays a crucial role in the administration of a chapter 11 case. It monitors the debtor’s operating reports, application for compensation by professionals, the plan of reorganization filed with the court and creditor committees. The debtor is required to open and maintain a new bank account for the chapter 11 estate. This is referred to as the “debtor in possession” account.

During the initial 120 days of the filing, only the debtor can propose a plan of reorganization outlining how his or her creditors will be treated – known as the exclusive period. This period can be extended by motion. At the expiration of the exclusive period, creditors can file a competing plan. Section 1123(a) of the bankruptcy code outlines the mandatory provisions of a plan proposal. Creditors not satisfied with their treatment can file an objection to the plan.