If your debts are piling up, a Northampton bankruptcy lawyer may be able to assist you. Bankruptcy affords people the opportunity to discharge or restructure their debts, including credit card debts, mortgage debts, and car loans. However, prior to filing for bankruptcy, it is important for you to understand how bankruptcy works and the bankruptcy laws involved. A Hampshire County bankruptcy lawyer will be able to explain your options and can help you to determine which type of bankruptcy best suits your unique situation.
Under United States bankruptcy law, there are two forms of personal bankruptcy: Chapter 7 and Chapter 13. Your Northampton bankruptcy lawyer will be able to recommend one of these processes, depending upon your financial assets and personal financial goals.
Chapter 7 Bankruptcy
A Chapter 7 bankruptcy will allow you to discharge or eliminate most of your debts. However, it is important to note that some types of debt, including student loans, most tax obligations, and child support and alimony, may not be discharged as part of bankruptcy proceedings. It is also important to understand that there are certain disadvantages to Chapter 7 bankruptcy filings. In order to file for Chapter 7, you must first demonstrate that you are financially unable to pay your debts. Most of your property and assets will then be confiscated and sold off in order to pay your creditors.
During these proceedings, you will retain your right to your public benefits and pensions. However, the bankruptcy trustee has a right to confiscate most of your personal property.
The entire Chapter 7 bankruptcy process takes about 3 or 4 months to complete fully.
Chapter 13 Bankruptcy
Chapter 13 bankruptcy is different from Chapter 7 bankruptcy. In a Chapter 13 bankruptcy, your debt is reorganized and a payment plan is established. Consequently, you are allowed to keep your house, motor vehicles, and other personal property. You must, however, pay your creditors the value of your non-exempt assets over a period of three to five years and make monthly payments to the bankruptcy trustee during this time period.
Chapter 13 bankruptcy releases less debt than Chapter 7. In order to qualify for a Chapter 13 bankruptcy, you must show that you are able to repay your outstanding debts.
A Chapter 13 bankruptcy may be in your best interest if you are in foreclosure or have unpaid tax bills piling up. A Hampshire County bankruptcy lawyer may be able to help you evaluate your finances and understand all of your legal options.
Choosing Between Chapter 7 and Chapter 13 Bankruptcy
Chapter 7 and Chapter 13 bankruptcies both have pros and cons associated with them. Before you file for any kind of bankruptcy, it is essential that you understand how each type of bankruptcy could impact your personal goals and finances. You must meet the Chapter 7 means test in order to qualify for a Chapter 7 bankruptcy. However, if your monthly disposable income exceeds the means test threshold, you will only be eligible to file for a Chapter 13 bankruptcy.
The benefit of a Chapter 7 bankruptcy is that it is a quicker and less expensive process. However, it is more difficult to retain homes, personal property, and other assets, following a Chapter 7 bankruptcy. Although a Chapter 13 bankruptcy takes longer and is a more expensive process overall, you may still be able to participate in a mortgage modification program. This program would stop foreclosure proceedings on your home. Moreover, under a Chapter 13 bankruptcy, you are not required to surrender your nonexempt assets.
A knowledgeable and skilled Hampshire County bankruptcy lawyer, can help you to decide which form of bankruptcy is best for you. An experienced attorney will be able to thoroughly examine your financial picture and craft a bankruptcy strategy that meets both your personal goals and your financial needs. A lawyer’s guidance can also help to streamline the process and give you peace of mind over the entire bankruptcy process.
A Northampton Bankruptcy Lawyer Can Help
Before filing for bankruptcy, it is essential that you consider speaking with a Northampton bankruptcy lawyer. Debt and financial pressure causes stress and uncertainty, and it can be difficult to properly evaluate your legal options if you go it alone. The Law Office of Eric Kornblum can help you discharge your debts or restructure your finances as you pursue the road to financial recovery.