Filing bankruptcy may provide certain individuals and businesses with a fresh financial start when excessive debt has become unmanageable. In some cases, bankruptcy can help eliminate debt and end collection calls from debt collectors. In addition, bankruptcy may be a smart option for individuals or businesses whose incomes were adversely affected by factors including job loss, medical illness and more.
There are several different chapters of bankruptcy an individual or business may file depending upon their situation. The two most common chapters of bankruptcy include chapter 7 and chapter 13 bankruptcy. Other chapters of bankruptcy include chapter 9, chapter 11, chapter 12 and chapter 15.
Chapter 7 bankruptcy is commonly considered a liquidation type of bankruptcy since individuals and businesses are typically required to sell any nonexempt assets to repay creditors.
Chapter 7 bankruptcy offers the benefit of potentially being able to discharge certain types of debt. When a debt is discharged, an individual or business is no longer legally responsible for repaying the debt obligation.
Chapter 13 bankruptcy is commonly considered a reorganization type of bankruptcy since individuals may have their debts restructured to make more affordable payments.
Chapter 13 bankruptcy offers the benefit of potentially being able to keep a home and other assets. Chapter 13 bankruptcy is typically reserved for individuals who have some disposable income after paying their basic living expenses each month.
Five potential benefits of filing bankruptcy can include:
Filing bankruptcy can be a complicated and confusing process. A typical bankruptcy petition may contain well over 100 pages, and a single mistake may cause the bankruptcy case to get thrown out. For this reason, it is often beneficial to enlist the help of an experienced bankruptcy attorney.
Volks Anwalt offers free case evaluations to determine how we may help with a bankruptcy case. For more information and a free case evaluation, contact us today.