Bankruptcy Simplified

Bankruptcy is a legally and morally valid option for addressing your debts in an honest and realistic way. It gives consumers two primary choices—Chapter 7 “straight bankruptcy” and Chapter 13 “adjustment of debts”—along with other less common ones. Within those two, you usually have specific options about how to deal with certain creditors.

Bankruptcy is a personal choice that may or may not be right for you, but if you are financially struggling, you owe it to yourself to find out about it.

Bankruptcy Law

The U.S. Constitution, which was ratified 225 years ago as of this June, specifically gave Congress the “Power . . . To establish . . . uniform Laws on the subject of Bankruptcies throughout the United States.” ( See Article 1, Section 8, clause 4 .) As a result, bankruptcies are governed by federal law, contained in the Bankruptcy Code . But in our federal system, state laws also significantly affect bankruptcies, maybe most directly by providing property exemptions that its residents may use to protect their assets from their creditors.

The Bankruptcy Chapters

You can choose among different “Chapters” of bankruptcy to file. Each one is quite different. Sometimes it will be quite clear which one is best for you, other times there will be advantages and maybe disadvantages to each to weigh against your situation.

Chapter 7 is the most common, usually a 3-4 month procedure with the main purpose to discharge (legally write off) your debts.

Chapter 13 is usually (but not necessarily) for somewhat more complicated situations, and comes with powerful tools for dealing with special debts (like taxes, support obligation, home mortgages and vehicle loans) that may not be handled adequately by Chapter 7. It takes 3 to 5 years.

Chapter 11 is usually used for businesses, but is also sometimes used by consumers, particularly if they have extraordinarily high amounts of debt.

Chapter 12 is for ranchers, farmers, and fishermen.

The Options within the Chapters

For almost everybody, you have options within each Chapter. For example, you generally have options about how you deal with your collateral on secured debts—such as a home with a mortgage and a vehicle on a vehicle loan—whether to retain or surrender the collateral. You may have options also about how to address special creditors like the IRS or an ex-spouse. Chapter 7 and Chapter 13 each give you different tools for dealing with each kind of creditor, which will of course affect your decision about which Chapter to file under.

Open the Door to These Options

So bankruptcy gives you choices. If you have debt problems, a bankruptcy case can usually be fashioned that will fit your own unique situation.

Bankruptcy is not a perfect tool, and sometimes it may not be the wisest or best solution. It is a serious choice that comes with benefits and costs that need to be carefully considered. It IS a decision with major consequences no matter what you end up doing. So it should definitely be made with the advice and counsel of an attorney with substantial experience in bankruptcy. A knowledgeable and conscientious attorney will help you face your situation in an informed, rational, and wise way.

Let me be that source of good advice and friendly counsel. If you live in Texas near Rockwall, Heath, Greenville, Lavon, Wylie, Mesquite, or Rowlett, please contact me, bankruptcy attorney Carrie Weir. We can discuss all your options in a free and confidential consultation at 972-772-3083 . Or else feel free to use the contact form here . Thank you for visiting my website.

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Call Rockwall bankruptcy lawyer Carrie Weir at 972-772-3083 or fill out the contact from below for a free, confidential consultation to discuss your options.

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