Chapter 7 bankruptcy is a type of personal bankruptcy procedure that ends the legal right of the individual or business to use their property as collateral against the debt. The end result is that property cannot be seized by creditors, and some debts may be discharged. Chapter 13 bankruptcy is a repayment plan or reorganization. In this case, the individual is allowed to keep their property, and continues to pay their debt but under a court-approved repayment plan. Find out what type of bankruptcy you should pursue.
Eligibility Requirements for Bankruptcy
In order to be eligible for Chapter 7 bankruptcy, the individual must meet certain eligibility requirements based on income, debt and more. Chapter 13 bankruptcy is only accessible to individuals who have regular income from wages or self-employment and are unable to make reparation due to circumstances beyond their control. If you are considering filing for bankruptcy, speak with a licensed attorney at The Law Offices of John Mufson before you file to find out which option best suits your situation.
What Happens During the Chapter 7 Bankruptcy Process?
It is available to individuals or businesses who want to get rid of debt and keep their property. If you are considering going through this process, you will meet with a certified attorney to determine if your situation qualifies. The attorney will gather financial information from you and your creditors, and may also contact other debtors in order to file a case against all of them. After filing the case, the court will set a date for a hearing, during which you will have to explain why you need this type of bankruptcy. If your debt is discharged, you will receive a notification of relief from creditors, and no further action in the case can be initiated against you except for nondischargeable debt.
What Happens During the Chapter 13 Bankruptcy Process?
This is a repayment plan for individuals who have regular income and are unable or unwilling to repay all their debts in full. If you are considering filing for this bankruptcy, you will meet with a certified bankruptcy attorney to determine if your situation qualifies. The attorney will gather financial information from you and your creditors, and may also contact other debtors in order to file a case against all of them. After filing the case, the court will set a date for a hearing, during which you will have to explain why you need this type of bankruptcy. If your debt is discharged and your plan approved, you will receive notification of relief from creditors and can start making payments within the repayment plan.
Conclusion
Bankruptcy is a great solution for certain types of debt, most of which are caused by typical life circumstances. It can be a financial shock to individuals who have never been in this kind of situation, but it is a relief for everybody else because the negative effects of debt can make life much more difficult. If you are contemplating bankruptcy, contact The Law Offices of John Mufson for a bankruptcy attorney in West Palm Beach to discuss all of your options.