There are several options available for filing for bankruptcy in the state of Illinois, and there are various types or "chapters" of bankruptcy. Which options or "chapter" you choose depends on which you may possibly be eligible for, however, two of the most commonly filed are Chapter 7 and Chapter 11.
Although Chapter 11 can apply to individuals, it is most often filed by businesses including sole proprietorships and corporations. The key difference between a Chapter 7 and Chapter 11 concerns the repossession and liquidation that accompanies a Chapter 7 filing. Chapter 11 filings differ, as they allow the option of restructuring and reorganization to bring finances in line with a debt structure that is manageable and can be more feasibly met.
Chapter 11 helps you to avoid loss of your assets or your business, while allowing you to maintain a level of control over them, although such control may be subject to court oversight. The Chapter 11 process is aimed at allowing you to rebuild and restructure the financial and operational infrastructure of your business so you can move forward without an excessive or unmanageable debt load.
Like most chapters, filing a Chapter 11 bankruptcy entitles you to enjoy the benefit of an automatic stay, which frees you having to live with the constant creditor harassment. The automatic stay is automatically enacted once your bankruptcy filing is initiated with the courts. All attempts to collect your debt will immediately cease, and you can then rebuild without the phone ringing incessantly with collection agency calls.