{"id":54131,"date":"2020-07-12T10:35:31","date_gmt":"2020-07-12T15:35:31","guid":{"rendered":"https:\/\/olduvai.ca\/?p=54131"},"modified":"2020-07-12T10:35:32","modified_gmt":"2020-07-12T15:35:32","slug":"a-surge-in-small-business-bankruptcies-is-underway","status":"publish","type":"post","link":"https:\/\/olduvai.ca\/?p=54131","title":{"rendered":"A Surge in Small Business Bankruptcies is Underway"},"content":{"rendered":"\n<h3 class=\"wp-block-heading\"><a href=\"https:\/\/www.thestreet.com\/mishtalk\/economics\/a-surge-in-small-business-bankruptcies-is-underway\">A Surge in Small Business Bankruptcies is Underway<\/a><\/h3>\n\n\n\n<figure class=\"wp-block-image\"><img decoding=\"async\" src=\"https:\/\/imageproxy.themaven.net\/https%3A%2F%2Fimages.saymedia-content.com%2F.image%2FMTczOTA0ODE0OTUyOTQ5NjAx%2Ftwisted-root-burger-bankruptcy.png\" alt=\"\" title=\"\"\/><\/figure>\n\n\n\n<p class=\"wp-block-paragraph\">The new rules make it easier for small businesses to file for chapter 11. And they are.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><strong>Small Businesses Walking Away<\/strong><\/p>\n\n\n\n<p class=\"wp-block-paragraph\">In 2008, homeowners walked away from mortgages.&nbsp;<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Thanks to the&nbsp;<a href=\"https:\/\/www.abi.org\/sbra\" target=\"_blank\" rel=\"noreferrer noopener\">Small Business Reorganization Act of 2019<\/a>&nbsp;(SBRA), in effect as of February 19, 2020, small businesses have an easier shot at doing the same.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">For example, the Twisted Root Burger grew quickly, but co-founder now says<a href=\"https:\/\/www.wsj.com\/articles\/burger-chain-turns-pioneer-for-new-small-business-bankruptcy-law-11594459800\" target=\"_blank\" rel=\"noreferrer noopener\">&nbsp;\u2018I\u2019m gonna walk away\u2019 from some locations<\/a>.<\/p>\n\n\n\n<blockquote class=\"wp-block-quote is-layout-flow wp-block-quote-is-layout-flow\"><p>Twisted Root Burger was a Texas success story, expanding from one casual restaurant in 2006 to 24 sites including restaurants, bars, a brewery and a theater. Now, the company is moving fast in another direction\u2014into bankruptcy.<\/p><p>\u201cI\u2019m not gonna open that restaurant at half the revenue,\u201d said co-founder Jason Boso. \u201cI\u2019m gonna walk away from those restaurants. I\u2019m not gonna set myself up for failure.\u201d<\/p><p>More than 500 companies filed for bankruptcy under the small-business bankruptcy rules since February, according to the American Bankruptcy Institute. June was the top month for filings with 131 cases; many were filed in states hit hard by the pandemic like Florida, Texas, California, New York and Illinois.<\/p><p>\u201cIt was somewhat prescient,\u201d said Ryan Wagner, a restructuring and bankruptcy attorney with international law firm Greenberg Traurig LLP. \u201cIt was passed without the foresight of the pandemic.\u201d The law is the most significant change to the bankruptcy code since 2005.<\/p><\/blockquote>\n\n\n\n<p class=\"wp-block-paragraph\"><strong>SBRA Highlights<\/strong><\/p>\n\n\n\n<ul class=\"wp-block-list\"><li>Applies to businesses with $2.7 million in liabilities, raised to $7.5 million under coronavirus stimulus<\/li><li>Owners continue operating their business while in court<\/li><li>Owners can retain equity after exiting bankruptcy<\/li><li>Owners can modify residential mortgages if home was collateral for a business loan<\/li><li>Faster turnaround to save time and minimize legal fees<\/li><li>Owners generally have three to five years to repay creditors<\/li><li>Creditors can be paid based on a business\u2019s projected income<\/li><\/ul>\n\n\n\n<p class=\"wp-block-paragraph\">Walking away gets a new lease on life, this time for small businesses.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>A Surge in Small Business Bankruptcies is Underway The new rules make it easier for small businesses to file for chapter 11. And they are. Small Businesses Walking Away In 2008, homeowners walked away from mortgages.&nbsp; Thanks to the&nbsp;Small Business Reorganization Act of 2019&nbsp;(SBRA), in effect as of February 19, 2020, small businesses have an [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[2],"tags":[1361,14648,13390,22815],"class_list":["post-54131","post","type-post","status-publish","format-standard","hentry","category-economics","tag-bankruptcy","tag-michael-shedlock","tag-mishtalk","tag-small-business"],"_links":{"self":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/54131","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=54131"}],"version-history":[{"count":1,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/54131\/revisions"}],"predecessor-version":[{"id":54132,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/54131\/revisions\/54132"}],"wp:attachment":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=54131"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=54131"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=54131"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}