People file for bankruptcy for lots reasons, including loss of employment, unforeseen illness, and even sustaining an injury at work without receiving adequate workers’ compensation. Fill out this form for a free case evaluation and discover if bankruptcy is the right choice for you.
Types of bankruptcy
The federal bankruptcy court oversees bankruptcy cases. Depending on your circumstances, you could file Chapter 7 liquidation or Chapter 13 reorganization. If you’re a business or an individual with several rental properties or you have a lot of assets, you may be able to file Chapter 11 reorganization.
Generally, when you file Chapter 7, you don’t get to keep much of your assets. Some items are exempt, such as one vehicle in your name, your clothing, and some personal items. Sometimes, filers are able to keep their home. If you want to keep your home and more of your assets, you might file Chapter 13 or Chapter 11 reorganization.
The exemptions are different; however, both types of bankruptcies take longer and require more from you. For example, when you file Chapter 13, you must make a plan, which shows how you will pay back some of the debt you owe. A bankruptcy attorney will help you complete the paperwork to file, including a financial affidavit showing how much you can allocate towards debts.
While you can complete a Chapter 7 within a few months, discharging your debt, Chapters 13 and 11 could take 3-5 years or longer. The upside to this is that as soon as you file bankruptcy, an automatic stay is put into place. No creditor may contact you for collections if the bankruptcy is in progress unless the creditor gets leave from the court to lift the stay.
The bankruptcy process simplified
Once you file the initial bankruptcy petition, the automatic stay goes into effect. No creditor may contact you for collections. You will receive a court date for a 341 meeting, also known as a meeting of creditors. Before the 341 meeting, you must take the required debt management class. If you are filing Chapter 13, you also must complete a plan.
The 341 meeting is held so that any creditor may object to you filing bankruptcy, but it is rare that a creditor even shows up. The meeting is with the trustee assigned to your case, so you will also receive further instruction as to making plan payments once the plan is approved. Once all plan payments are made, the court will discharge the bankruptcy. Any allowed debt included in the bankruptcy is wiped out, even if the plan only paid pennies on the dollar for the money you owe.
Contact a bankruptcy attorney
No one wants to struggle financially – we understand how tough it can be. Contact Morgan & Morgan to find out if filing for bankruptcy is the right move. We’ll assess your individual financial situation and help you make an informed decision. Choosing the right law firm can make all the difference. Our bankruptcy attorneys will assist you in navigating every step of the complex process so you can focus on what matters most. At Morgan & Morgan, we treat every client like family, ensuring the best possible service. You and your family deserve a fresh start. Fill out this form for a free case evaluation to discover what we can do for you.