Think Before You Start a Business after Chapter 7 Bankruptcy

The timing of starting a new business after you have filed for Chapter 7 bankruptcy is important. You should consult with a qualified bankruptcy attorney. Business income is considered an asset and could be seized to repay your debts up until the Chapter 7 bankruptcy is discharged.

After the Chapter 7 bankruptcy is discharged you will no longer have to worry about your future earnings being used to pay the old debt. The problem will be finding financing and suppliers for your new business. You will be operating on a cash basis for some time, and getting new credit, property, tools, and supplies will be difficult.

With the help of a partner or co-signer, you may be able to establish credit in the name of the new business. Expect to pay higher interest rates than before your bankruptcy filing.

Consult with bankruptcy attorneys such as those at The Frutkin Law Firm PLC, in Phoenix, Arizona. An experienced bankruptcy lawyer can help advise you on how best to proceed with your new business.