Updated: Jun 8, 2020
What is bankruptcy?
Bankruptcy is a law that may protect your home, your car, your paychecks, business and many other assets when you owe money and you are unable to pay. There are three primary types of bankruptcy proceedings. All of the proceedings are designed to relieve the debtors of the pressure of debt collection and work out their debts through liquidation or reorganization. If the debtors have little or no income left after their reasonable monthly expenses, they may be a candidate for a Chapter 7 of the Bankruptcy Code. If the debtors qualify, Chapter 7 will grant the debtors a "Fresh Start", erasing most if not all debts, allowing the debtors a fresh start free and clear of the debts. The other type of bankruptcy is a reorganization. There are several types of reorganizations, but for consumers, the most widely used is Chapter 13. It allows various types of debt to be restructured into a payment plan and paid over as many as sixty months. Once the ordered plan is completed, a discharge will be granted and the balance of the debts will be erased as ordered by the court. Chapter 11 bankruptcy is primarily utilized by businesses for reorganization or related goals, but may be utilized by individuals under certain circumstances . The new sub-chapter V bankruptcy option under chapter 11 may be a viable option for individuals under certain circumstances. Tom Abrams has successfully represented individual and business clients in all aspects of the bankruptcy process and stands ready to assist you with your specific needs.
Can I still keep my house if I filed bankruptcy? Whether filing for bankruptcy can save your home from foreclosure will depend on your particular situation, as well as whether you file under Chapter 7,11 or Chapter 13. Generally speaking, Chapter 13 provides more protection so you have a better chance of not only stopping foreclosure but also keeping your home. Chapter 11 may also accomplish this goal , however, it is often more expensive to file and confirm a chapter 11 case. The new sub-chapter V 11 process does offer a more cost efficient process and certain advantages which renders that a viable potential option.
Will I lose all of my property and assets by filing for bankruptcy? There is a common misconception that when a debtor is filing for bankruptcy, he or she will lose all of his or her assets. This is simply not true. Although some properties may be subject to liquidation, and specific exceptions will vary from state to state, a debtor is generally allowed to keep a certain amount of personal properties, including cars up to certain value, equity in a home up to a certain amount, clothing, furniture, and many other personal belongings. Most of Thomas L. Abrams’ clients do not lose any assets in a bankruptcy based on applicable exemptions.
Can I continue to operate my business and still file for bankruptcy? In many cases, yes. It will depend on the type of business and the type of bankruptcy being filed. You need to hire an experienced attorney with the experience necessary to correctly prepare and handle the case. Thomas L. Abrams will carefully review your situation to ensure you are in the best position to continue with your business if that is your goal.
Can all types of debts be erased by filing for bankruptcy? No, not all types of debts can be discharged by filing for bankruptcy. While most debts are discharged, debts such as recent taxes, child support, spousal support, and certain educational loans are not able to be discharged by filing for bankruptcy.
If I file for bankruptcy, does my spouse have to file as well? No, your spouse is not legally required to file for bankruptcy with you. However in some situations, it may benefit you to file jointly. An experienced attorney can talk to you about your options in this regard.
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