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You could declare bankruptcy if you have debt you cannot repay even over time. You could also consider filing for bankruptcy if you need the benefit of a fresh financial start. Filing for bankruptcy can have several consequences you should carefully consider, such as temporarily damaging your credit.
If you have attempted to pay, settle, or renegotiate crushing debt without success, our bankruptcy lawyers can help. We will advise you on bankruptcy’s numerous Chapters, advise you on the best choice, and clarify bankruptcy’s many financial and personal benefits.
How Do I Know Which Bankruptcy Chapter Is Right for Me?
Bankruptcy is a serious undertaking with a complex filing process. U.S. Court guidelines even advise filers on the benefits of hiring a local bankruptcy attorney. The benefits of working with a lawyer include their ability to:
- Objectively review your financial situation
- Recommend a bankruptcy Chapter to pursue
- Explain the process of discharging debt
- Explain which debts are dischargeable
- Clarify which possessions you can retain
- Clarify the tax consequences of bankruptcy
The lawyer who represents you will also make sure you understand federal and state-specific laws and regulations. They can help you obtain and complete the plethora of forms, schedules, and documents of the bankruptcy process and represent you in court sessions.
Chapter 7 Bankruptcy
Chapter 7 bankruptcy is a common choice for individuals swimming in debt. It eliminates personal debt and some business and corporate debt. As a personal filer, you can usually retain possession of your property, including your home and vehicle. You can also discharge most, if not all, debts.
Your bankruptcy lawyer can help you prove your debt load, identify your creditors, document your debt-to-income ratio, and prove your eligibility for bankruptcy.
Chapter 11 Bankruptcy
Many individuals and businesses can also qualify for the relief of Chapter 11 bankruptcy. This option allows you to reorganize your debt and create a realistic and workable repayment plan.
Your bankruptcy lawyer can help you file for Chapter 11 relief by:
- Assessing your tangible assets and liabilities
- Documenting your income and expenses
- Reviewing your leases and contracts
Your lawyer can also help you understand and comply with the court’s requirements and complete all forms and schedules.
Chapter 12 Bankruptcy
Chapter 12 bankruptcy is set aside to meet the needs of family farmers and fishermen that face insurmountable debt. The filing process will require you to prove you have a regular income. You will also have to propose a debt repayment plan that repays your creditors over three to five years.
Your bankruptcy lawyer can explain the specific circumstances and requirements of this Chapter.
Chapter 13 Bankruptcy
As an individual, you can opt for Chapter 13 bankruptcy if you have a reliable source of income. It allows you to create a repayment plan that gives you several years to make timely repayments.
Filing for Chapter 13 bankruptcy typically means you can retain ownership of your possessions. It also means you may be required to participate in credit counseling.
Bankruptcy Can Have Life-Changing Benefits
The primary purpose of bankruptcy is debt relief. While it can be life-changing, so can other benefits of filing. An automatic stay can take away the fear of answering the phone or opening the mail, while credit counseling can help you discover new ways to manage your finances in the future.
Automatic Stay
Bankruptcy’s automatic stay puts a swift end to invasive and intrusive phone calls, emails, and other means of communication. Once an automatic stay is in place, your creditors cannot contact you or continue to demand repayment of your debt.
Your lawyer will explain the consequences of ignoring an automatic stay, including filing a civil suit against the at-fault creditor.
Credit Counseling
Bankruptcy law mandates that individual filers work with a credit counselor. This process can feel intimidating and annoying but has many benefits. Credit counseling and debtor education courses, when mandated by U.S. Courts guidelines, can:
- Help you understand your credit score
- Explain the benefits of creating and following a budget
- Offer recommendations for managing debt in the future
Credit counseling can also assist you in preparing a debt repayment plan if one is included in your bankruptcy Chapter. When a bankruptcy attorney represents you, they will also help you in many areas.
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Consult Our Bankruptcy Relief Team Today
If your current debt load cannot be managed with your current and foreseeable income, we could help. At Farmer & Morris Law, PLLC, our bankruptcy lawyers can help you determine if you should declare bankruptcy, which Chapter you should choose, and the benefits of a new financial start.
Contact one of our case review team members to get started today. We can also discuss managing how to keep your car and house.
