Keep the Bays Open: Auto Repair Bankruptcy With Subchapter V
A couple of big jobs that never got paid, a parts account that ballooned, and lifts you are still financing can bury a good shop between slow weeks. Subchapter V bankruptcy reorganizes that debt so the bays stay full while the shop digs out.
Keep turning wrenches
An auto shop carries overhead most customers never see: the lifts and diagnostic gear, the standing parts accounts, the building. Let a few large repairs go unpaid and that overhead stacks up quickly. Subchapter V reorganizes it into a plan the shop can manage without dropping a single lift.
Shop debts we restructure
- Financing on lifts, alignment racks, and diagnostic gear
- Running balances at parts suppliers and warehouses
- Back rent on the shop and the lot
- Loans on hand tools and specialty shop equipment
- Shop credit cards and working lines of credit
- EIDL advances and SBA loans still being repaid
How Subchapter V helps shops
- Keep the lifts running and the bays booked
- Stop parts-supplier and lender suits when the case opens
- Reset equipment and parts debt to payments the shop can meet
- Keep the parts accounts open so you can still take the job
- Stay the owner and keep writing the work orders
How it works
A clear path for shop owners.
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1
Step 1 of 4
Free consultation
We look at your equipment loans, your parts accounts, and the shop's numbers to decide whether Subchapter V is the right move or another chapter serves you better.
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2
Step 2 of 4
File and stop collections
As soon as we file, the automatic stay halts the supplier and lender lawsuits so the crew keeps pulling cars in and out.
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3
Step 3 of 4
Build the plan
We put together a three-to-five-year plan sized to what the shop nets across a normal run of tickets.
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4
Step 4 of 4
Keep working
With the plan confirmed, you fund it from ongoing repairs and keep the lifts, the tools, and the shop.
Common questions about Subchapter V for Auto Repair Shops
Can I keep my shop equipment and lifts?
Yes, you keep them. The lifts, alignment rack, and scan tools the shop runs on stay with you, and we bring the loans against them down to payments a normal ticket flow can cover.
Will my parts suppliers cut me off?
Filing stops the collection pressure and folds the old balance into the plan, and because a paying shop is worth more to a warehouse than a closed one, the accounts you rely on usually stay open.
Can I keep taking work while this is going on?
Yes, you can. You run the shop the whole way through as the owner, writing tickets and taking cars in exactly as you do now.
What about customer cars in my shop?
Cars in your bays belong to your customers, not to the bankruptcy, so day-to-day repairs keep moving as normal. You generally keep your right to be paid for work already done before a vehicle leaves, the same as always. The case is about the shop's own debts, and we walk through anything unusual, like fleet accounts or a long-term storage car, before we file.