No one likes to think that they may one day file for bankruptcy. There are a slew of facts, and myths, to pore over before beginning the process. It is also important to note that there is a difference between personal bankruptcy and business bankruptcy, and what they mean to your particular case. A qualified bankruptcy lawyer in Rehoboth, Massachusetts, such as the Law Office of Brian R. Lewis, can help guide you through the entire process, answering every single question you may have along the way. While some areas differ in the requirements and process, bankruptcy laws in the United States are fairly standard.
Bankruptcy is simply defined as the status of a business or individual who cannot repay loans and other debt to their creditors. There are different options, depending on the needs of the individual or business. The most common types of cases filed are Chapter 7 bankruptcy, or “straight,” and Chapter 13 bankruptcy, also known as “wage-earner” bankruptcy.
Chapter 7 is considered fairly quick and easy. It is often associated to businesses or individuals who are low income, and have little or no chance of repaying back the debt. Oftentimes, a simple liquidation of non-secured assets are auctioned off by the trustee of the bankruptcy filing, and the funds raised are then used to pay off, or down, the debts owed to creditors. The process is simple if the debtor has all the information and documentation they need to proceed, as opposed to Chapter 13, which is considerably more detailed.
In some cases, individuals who file for Chapter 7 are eligible for redemption or reaffirmation programs, which involve paying-down a lump sum or making affordable payments based on individual income.
With Chapter 13 filings, there is no immediate ‘relief’ of the debt, as opposed to Chapter 7. The debtor decides to enter a reorganization of sorts, allowing them to pay down the debt within an allotted amount of time as approved by a bankruptcy court, usually anywhere from 3 to 5 years. The advantage of filing Chapter 13, debtors are able to have some debts discharged that they normally cannot under a Chapter 7 case. If a foreclosure is threatened, then Chapter 13 would stop the proceedings, though the process could restart after the completion of the bankruptcy case.If you live in Rehoboth, MA and decide that filing bankruptcy is the right thing for you or your business, make certain that you find a qualified bankruptcy attorney, such as the Law Office of Brian R. Lewis, who knows the laws and has experience in bankruptcy cases. The process can be surprisingly simple once you gain a general understanding of the various types of bankruptcy, the laws involved, and most importantly, your specific needs and abilities.
