Chapter 7 and Chapter 13 Bankruptcy
Kamini Fox Helps You Decide The Best Course of Action
Bankruptcy is not the end. It is a chance at a new beginning. The idea of this new beginning is so important and vital to the American cause that it is codified in the United States Constitution. There are times in our lives where we fall behind on bills and have a hard time managing our finances. Unfortunately, there are times when our debts and obligations become too much for us to handle. When that happens, the law provides for a remedy.
For personal bankruptcy, the two main types of bankruptcy are Chapter 7 and Chapter 13, references to the chapters of the federal law that describes each of them.
Chapter 7 Liquidation Bankruptcy
Chapter 7 bankruptcy is an individual liquidation bankruptcy. All consumer unsecured debt, medical bills, and credit card debt may be discharged during the bankruptcy, and you may no longer be responsible for them. Exceptions to this include student loans, most taxes, and domestic obligations, such as child and spousal support.
For many people, this is the fresh start they have been hoping for. While your credit may be damaged for a period, you no longer have to deal with the weight of overwhelming debt and have the opportunity to correct financial decisions for a more secure future. You may be able to rebuild your credit in the future.
Chapter 13 Reorganization Bankruptcy
Chapter 13 bankruptcy allows the individual to pay back debt, and in so doing, keep the property he or she owns, such as a home. You will be set up with a repayment plan which reorganizes and restructures the debt that you have over the course of three to five years. This makes your debt and payments more manageable and offers a more comfortable approach to a fresh start.
Both forms of personal bankruptcy result in an immediate court-ordered stop to all creditor calls and harassment, wage garnishment, home foreclosure, and auto repossession.
Chapter 13 bankruptcy allows you to stop a scheduled foreclosure sale, and force your mortgagee to reinstate your mortgage, if you can cure your pre-bankruptcy mortgage arrears over a period of up to 36-60 months through payments to a Chapter 13 Trustee, while you also remit all regular mortgage payments that come due during the Chapter 13 case directly to the mortgagee as and when they come due. In certain circumstances, you can also void judgment liens on your property and strip down wholly unsecured junior mortgages on your home.
Chapter 7 vs. Chapter 13 - Which is Right For You?
When it comes to individual bankruptcy, every case is different, and there is no rule to state if Chapter 7 or Chapter 13 is better. For people who are eligible to file for either Chapter 7 or Chapter 13, the decision would be based on several factors, including whether there are assets that they would like to protect, such as a car. Chapter 13 would be the option to allow you to hold on to certain assets, while Chapter 7 would require the liquidation of certain assets.
For families whose income is above the median income for the size of the family, Chapter 7 is not an available option. For Chapter 13, you cannot have more than a specified amount of secured debt and unsecured debt.
Contact Bankruptcy Attorney Kamini Fox for a Free Initial Consultation
Starting, or even thinking about personal bankruptcy can be a very daunting and stressful time. You may feel like you failed your family or feel ashamed for having gotten into a position where you are unable to catch up on your bills. There is no reason to feel bad and you have not failed. Sometimes circumstances conspire to put us in a position where we need a legal remedy for our problems.
Consulting a Bankruptcy Attorney is the first step to recovery and is a sign of your desire to improve your situation for yourself and your family. There are times when filing for bankruptcy is the responsible thing to do to give yourself a new start and remove the stress of overpowering debt.
An Automatic Stay Means Relief Starts Immediately
When you file for bankruptcy, there is an Automatic Stay that is put in place. This Automatic Stay stops all of the harassing phone calls from creditors and stops all actions on pre-bankruptcy claims that have been started against you. After the Stay is in place, any actions taken by the creditors that violate the stay are not legally binding. In fact, you may sue a creditor for continuing to contact you for attempting to begin or continue an action against them after the stay is in place.
Experience Counts when it comes to Personal Bankruptcy
Contact Kamini Fox to set up a free consultation. Consultations can be done remotely over video conference for your protection. If you have fallen behind on your debts and creditors won't stop calling, it is time to consider the benefits of Chapter 7 or Chapter 13 Bankruptcy Protection. Call Kamini Fox at 516-493-9920.