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We assist the client to determine
which form of bankruptcy is most appropriate and file
appropriate documents required to complete the
bankruptcy process
What is Bankruptcy?
Bankruptcy is the legal process that allows relief to individuals or businesses
from their debts while ensuring fairness to creditors.
Chapter 7 bankruptcy is usually best for people who:
- Have no steady stream of income
- Have a lot of exempt property
- Cannot keep up with a strict payment plan
Chapter 13 bankruptcy is usually best for people who:
- Do not want to lose their property (including real estate, cars, and personal property)
- Have a lot of nonexempt property
- Have a steady stream of income and can eventually pay of their debts
- Can live with a strict budget and adhere to a strict payment plan
- Chapter 7 Bankruptcy
Chapter 7 bankruptcy is often called "liquidation bankruptcy." This
process starts when a petition is filed with the bankruptcy court
detailing the individual's property, debts, and financial situation.
Once bankruptcy proceedings are started, creditors cannot attempt to
collect debt from the individual until the bankruptcy process has ended. The court then appoints a trustee who determines which, if any, of the
individual's property must be sold off to pay their debts.
Much of the individual's property is not sold. This property is called "exempt"
property. Exempt property may include homes, vehicles, personal
property, insurance policies, and retirement accounts.
Many of the debts will be "discharged," meaning that they will not have to be paid. Some debts, however, are not dischargeable, including:
- Student Loans
- Recent Taxes
- Child Support and Alimony
- Legal Fines (i.e. traffic tickets)
The bankruptcy process is complete once all the debts have been either paid or discharged.
Chapter 13 Bankruptcy
Chapter 13 bankruptcy allows an individual to pay off his debt over
time. The process starts when the individual files a petition with the
bankruptcy court. This petition includes a complete list of all the
individual's debts and assets. Additionally, the petition must include
a payment plan that describes how the debt will be paid off over the
next three to five years.
The court then appoints a trustee who will review the payment plan. The
trustee has the power to approve or reject the plan. Once the payment
plan is approved, the debtor must make monthly payments to the trustee,
who will distribute those payments to the creditors as laid out in the
payment plan.
Once the payment plan has been completely fulfilled, the individual is out of bankruptcy.
If you would like to arrange a consultation to discuss
your legal needs, please take the time to email(val@flvlaw.com)
or call.
Phone: 909.941.2558
Fax: 909.941.3203
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Bankruptcy