Bankruptcy laws help people who can no longer pay money borrowed or purchases they made from creditors. Not only people, bankruptcy laws also help troubled partnerships, corporations and provide for orderly distributions to business creditors through reorganization or liquidation. Thus bankruptcy laws allows people and business get new lease of life, a fresh start - by liquidating assets to pay their debts or by creating a repayment plan.
Bankruptcy code provides for six basic types of bankruptcy cases traditionally given the names of the chapters that describe them. Federal courts have exclusive jurisdiction, a bankruptcy case cannot be filed in a state court.
Once you have files and got bankruptcy discharge in a bankruptcy case. You won't be able to file bankruptcy case in the follwoing six to eight years (depending which type of bankruptcy you filed).
Most cases are filed under the three main chapters of the Bankruptcy Code - Chapter 7, Chapter 11, and Chapter 13.
Bankaruptcy filing is usually tough and the last option for individuals and businesses. For individuals, the goal of bankruptcy case is to get a fresh financial start by removing most debts and harrasment from creditors. However, bankruptcy virtually ruins a person's credit for several years, making it very difficult and expensive to borrow money in near future.
People files a petition with the federal bankruptcy court (in some cases, creditors can force a consumer by filing the petition themselves). In other words, a bankruptcy proceeding can either be entered into voluntarily by people or initiated by creditors.
The petition filer must provide the court with financial and tax information, as well as a list of creditors, outstanding debts and assets filer possess. Bankruptcy case petition automatically stops most collection actions against the debtor, including lawsuits, garnishments, and phone calls.
Chapter 7 bankruptcy is the most common type of bankruptcy proceeding. A filing under a Chapter 7 bankruptcy, which is also known as liquidation bankruptcy. Chapter 7 bankruptcy case involves the appointment of a trustee, to supervise the assets of the debtor, who collects the non-exempt property of the debtor, sells it and distributes the proceeds to the creditors unless they are exempt.
Each individual case is different. You should consider an attorney in your local area and assumptions should not be made regarding which bankruptcy chapter is right for you.
Contact us to help you find affordable bankruptcy attorney in your area to call and discuss your bankruptcy options. An expertattorney evaluate your case for, whether bankruptcy will benefit you. Attorney will see that if it’s worth filing for bankruptcy and provide you with adequate reasons as to why you should or not file.
DISCLAIMER: The above stated information should not be relied upon as legal authority nor should it be used as a substitute for reference to the U.S. Bankruptcy Code. Sole purpose of this website is debtor education towards bankruptcy. The information provided on this website may supplement, not substitute, for the advice of competent legal counsel. Please be advised to consult a bankruptcy attorney for legal advice. For additional information, please refer to the United States Bankruptcy Code (title 11, United States Code), the Federal Rules of Bankruptcy Procedure (Bankruptcy Rules), and the Local Rules for the respective States Bankruptcy Court.