You have more debt than you can handle. Maybe a friend, relative or even a lawyer suggested bankruptcy, describing it as the best thing in the world for you. Someone else may have said exactly the opposite, that bankruptcy is a huge mistake and will ruin your life. Right now, you're filled with emotional turmoil, confusion, fear, guilt, anguish. You don't know what bankruptcy is, whether or not it can help you or what it would mean for your future.
Stop your fretting and educate yourself; a little knowledge under your belt will almost certainly make you feel better. Here are some answers to the most commonly asked questions on bankruptcy.Isn't there more than one kind of bankruptcy?
Congress has devised two kinds of bankruptcy: liquidation and reorganization. Liquidation bankruptcy is called Chapter 7 bankruptcy. In a Chapter 7 case, you cancel, or discharge, certain types of debts in exchange for giving up certain types of property to be sold for the benefit of your creditors. As distressing as this may sound, many debtors are able to hang on to property they need to get on with their lives. You should consult a lawyer for a better idea of what property you could keep if you filed a Chapter 7 bankruptcy. If there are no problems, a Chapter 7 bankruptcy usually takes approximately 120 to 130 days from petition date to discharge date.
An individual who is a consumer, or who operates a small business, may qualify for a reorganization pursuant to Chapter 13 bankruptcy. In this type of bankruptcy, you use your income to pay some or all of what you owe to your creditors over time, between 3 to 5 years depending upon the terms of your plan.
An individual who is a family farmer may reorganize his debts through a Chapter 12 bankruptcy. Our firm represents family farmers in bankruptcy, and it is best for these farmers to discuss their financial problems with us.
A business company, partnership or an individual in business may reorganize debts through a Chapter 11 bankruptcy. Our firm represents distressed businesses in bankruptcy, and it is best for these businesses to discuss their financial problems with us.Will filing for bankruptcy stop the harassing phone calls?
If you are eligible, you may file a bankruptcy case and something called an “automatic stay” goes into effect. The automatic stay prohibits virtually all creditors from taking any action to collect the debts you owe them unless the bankruptcy court lifts the stay and lets the creditor proceed with collections.Will bankruptcy wipe out all my debts?
Different debts get different treatment in bankruptcy proceedings. Some debts may be wiped out (discharged) while some others won't be. Plus, rules are different for Chapter 7 versus Chapter 13 bankruptcies.