Reorganization Bankruptcy

Reorganization bankruptcy is a legal process that allows a financially troubled business or individual to restructure their debts while continuing operations. Instead of liquidating assets, they create a plan to repay creditors over time, often reducing the total debt amount. This process is typically governed by Chapter 11 of the U.S. Bankruptcy Code. The goal is to provide the debtor a fresh start while ensuring creditors receive as much payment as possible. It involves negotiations, court approval, and adherence to the repayment schedule, ultimately aiming for the debtor to return to financial stability.