By filing for bankruptcy, individuals or entities that are unable to handle their financial burdens can have their debts cancelled, paid through the liquidation of their assets and/or reorganized into an affordable repayment plan.
While many debts can be eliminated through bankruptcy, there are some you may not be able to get rid of, including secured debts, alimony, student loans, taxes and child support.
How Does Bankruptcy Work?
There are several types of bankruptcy, including Chapters 9, 12 and 15. However, most bankruptcy cases fall under the following chapters:
• Chapter 7 bankruptcy gives a bankruptcy trustee the power to cancel most or even all of your debts and/or sell some of your possessions to pay off what you owe.
• Chapter 11 bankruptcy gives debtors, usually businesses, an opportunity to reorganize their debt under a plan approved by the court that will enable them to continue running their business while repaying their creditors. Chapter 11 bankruptcy is generally reserved for businesses, but, in some cases, individuals whose debt or income is greater than Chapter 7 or 13 permit may be able to file under Chapter 11.
• Chapter 13 bankruptcy does not cancel your debts and allows you to keep your property by instead reorganizing your debt so that you can repay your creditors all or part of what you owe them over a three to five-year period.
I Need a Bankruptcy Lawyer
Bankruptcy is a big step and one that should not be taken lightly. That is why those considering it for themselves or their business should speak with an attorney to figure out whether it is right for them. If you would like to learn more about the bankruptcy process or need to discuss your situation with a lawyer who handles bankruptcies, the following attorneys are available to assist you:
- David Alan Ast, P.C. – Morris County, NJ
- The Law Firm of Kevin D. Judd – Washington, DC
- Sader Law Firm – Kansas City, MO
- Seal Hanson, LLC – Alabama