Talk of The Villages Florida - View Single Post - TooJay's filing for bankruptcy
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Old 05-01-2020, 08:06 AM
PPLEPEU PPLEPEU is offline
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Quote:
Originally Posted by Diverdave View Post
Absolutely correct, bankruptcy is simply a way of saying "Please give me some room to breath while I get back on my feet, I think I can make this work out if you will just work with me"
But most often it just passes the problem up the line.

For example, if their kitchen equipment is worth $200,000 but they owe $500,000 Chapter 11 court would likely allow them to reduce the principal and pay only on the lower amount.

Good for the filer, bad for the business that loaned them the money. That next level up could be a relatively small business that borrowed money to buy the equipment to sell on terms to TooJays. Now they won’t get paid enough to cover their expenses and might also go bankrupt if enough of their customers stop paying.

And on it goes to the next level up.

These will be VERY challenging times if the lockdown extends much longer.