Bankruptcy Frequently Asked Questions
Chapter 7 is referred to as the liquidation chapter. Through this process, you must repay creditors by selling nonexempt assets. This is the most common form of bankruptcy because it is a relatively quick process.
Chapter 11 is mainly for business owners but can be used for individuals. This form of bankruptcy reorganized debt to repay creditors. These negotiations can be complex and generally are in favor of the creditors.
Chapter 13 usually involves individuals and seeks to create a plan to pay back creditors over a course of three to five years while allowing the debtor to keep and use all property.
Individuals can file for Chapter 7 and 13 bankruptcy on their own but it is strongly recommended to consult a trained bankruptcy attorney because of the long-term repercussions from not understanding the laws. Furthermore, judges are prohibited from sharing legal advice during your proceeding so an attorney is advised.
Filing for bankruptcy can harm your credit score for years but hiring a professional bankruptcy attorney can minimize the impact and save you years of severely negative credit scores.
Once you file your case you can immediately be protected for your creditors through what is called an automatic stay. bankruptcy.