What Is Bankruptcy?
Bankruptcy is a legal process where a debtor reorganizes debt through the division of assets. Different possibilities for debtors in filing for bankruptcy vary depending upon each situation.
Bankruptcy allows you to eliminate debt or repay creditors over time without penalties. Filing for bankruptcy shields individuals from future creditor attacks and protects assets.
Who Can Qualify For Bankruptcy?
Bankruptcy can be filed by an individual or a business. There are varying levels of financial hardship for those filing for bankruptcy.
However, most people can qualify for filing either Chapter 7 or Chapter 13 bankruptcy.
Over one million people a year file for bankruptcy, including business owners and high income earners who are looking to alleviate their debt while holding on to other assets.
What Are The Different Types Of Bankruptcy?
The most commonly filed forms of bankruptcy are Chapter 7 and Chapter 13.
The major difference between Chapter 7 and Chapter 13 is the choice to pay back money over time. If you have overwhelming amounts of debt and extenuating circumstances such as loss of job or illness and wish to eliminate your debt overall, you may consider Chapter 7.
If you have a steady income but are being weighed down by debt, you may choose to file Chapter 13 bankruptcy and pay back your debt over time.
If you are a business-owner looking to file for bankruptcy, Chapter 11 bankruptcy allows business to file for bankruptcy due to creditor and supplier debt. Chapter 11 can also be filed by high net worth individuals.
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How Do I File For Bankruptcy?
After contacting Citizens Law Group LTD. and consulting with one of our experienced bankruptcy attorneys, we will recommend which form of bankruptcy is best for your case.
Prior to filing, you must first complete a credit counseling class. Once completed, the attorneys at Citizens Law Group LTD. will work with you to complete and assemble all the paperwork necessary for filing with the bankruptcy court.
We will help you through each step of the process, assuring each step is done with high quality service. Contact Citizens Law Group Ltd. today to speak to one of our expert bankruptcy attorneys.
Unfortunately, the common assumptions of bankruptcy shed a negative light on the entire process. Don’t let myths and misinformation sway you away from a decision that could bring a substantial life improvement.
We’ve put together a list of popular bankruptcy myths and have busted those myths with honest and expert answers.
Myth: I will lose my property and assets if I file for bankruptcy.
Truth: When you file Chapter 13 bankruptcy, you are able to keep property and assets, since you are not using these to repay creditors. When filing for Chapter 7 , there are still properties and assets you will retain if filed and executed properly.
Myth: It is difficult to file for bankruptcy.
Your escape plan should also include pets if applicable, and having any important documents in one spot and handy and scanned into a secure account in the cloud or on a hard drive or both is always a good idea.
Truth: Making the decision to file for bankruptcy is far more difficult than the current filing process. Using a bankruptcy attorney will take the extra time and stress out of the process and you will be on your way to a clean slate in no time.
Myth: You will have difficulty ever buying anything again.
Truth: While you will have to work to re-establish credit after your debts are discharged, you are still able to purchase what you can afford. Many companies nowadays offer credit lines to those who have filed for bankruptcy.
Myth: I will lose my retirement benefits if I file for bankruptcy.
Truth: Pensions and 401(k)s are completely protected and will not be taken away.
Myth: Only the desperate file for bankruptcy.
Truth: With today’s economy and the increasing number of foreclosures, filing for bankruptcy is a common practice. Filing for bankruptcy is a responsible financial decision that can create a debt-free, low-stress financial future.
Myth: You can only file for bankruptcy protection once.
Truth: After eight years, you can file for Chapter 7 again. After a two year wait from discharge on a Chapter 13 , you are able to file again.
Myth: All debts can be cleared through bankruptcy filing.
Truth: Unfortunately, this one is not true. While it can clear a large portion of your debt, it does not discharge child support, alimony, most student loans and most taxes. For more questions, contact one of our expert bankruptcy attorneys today!
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With years of experience and expert training, our Chicago attorneys fight for you, making sure you get ready for your next chapter. SEE HOW WE WORK WITH YOU.