A Chapter 7 bankruptcy case may be used to wipe out much of an individual's debt, such as credit card debt; as well as debt from bank loans, court judgments, and medical bills. However, not all debt can be wiped out. Debt that does not qualify for liquidation includes certain tax debt, student loans, government fines, child support, and alimony. Additionally, eliminating secured obligations, including mortgages and car loans, causes a loss of the collateral. An individual may keep the collateral by reaffirming the loan and continuing the payments if doing so does not create an undue hardship.
Not everyone is eligible to file for Chapter 7 bankruptcy. To avoid abuse of the process, all debtors are required to complete a "means test," which will compare your income to the median income of a household of similar size in your area. If your income is more than the median, it does not mean you are automatically disqualified from filing; therefore, we recommended that you seek our expert legal counsel to further discuss your eligibility.
Bankruptcy with the Willhelm Law Firm
Chapter 13 may be the best way to catch-up, consolidate and keep your stuff. Often referred to as the "wage earner" bankruptcy, Chapter 13 is available to small unincorporated businesses also. If you have regular income and a desire to pay your debts (or a portion of them), but currently are unable to do so, a chapter 13 repayment plan allows you to restructure your debt with bankruptcy court supervision and protection. Potentially, you could consolidate your debt into one payment per month for 5 years while creditors are prohibited from starting or continuing collection efforts. Most importantly, Chapter 13 can help you save your house from foreclosure and your vehicle from repossession. Also, Chapter 13 is very useful to pay real estate or income taxes which are owed.
Chapter 11 bankruptcy is a form of bankruptcy reorganization available to individuals, corporations and partnerships. It has no limits on the amount of debt, as does Chapter 13. Large businesses, corporations and partnerships seeking to restructure their debt and continue operations choose Chapter 11.
Usually, individuals file Chapter 7 or Chapter 13 rather than Chapter 11, which are simpler and less expensive. However, Chapter 11 is available to an individual whose debt exceeds the limits of Chapter 13. Chapter 11 is the most flexible of all chapters; thus it requires affirmative votes from creditors. Seek our professional guidance to evaluate your situation and help you reorganize your business and your life.
Bankruptcy can be a confusing and anxiety-laden concept. Yet it can be, and is, a useful means of overcoming massive debt. Bankruptcy can provide a stable method of keeping your creditors at bay while you can legally restructure your financial situation, get back on your feet and off to a fresh start.
Chapter 12 bankruptcy allows “family farmers” and “family fisherman” to restructure their finances and avoid liquidation or foreclosure. It's very similar to Chapter 13 bankruptcy, but provides additional benefits to debtors. Only a family farmer or fisherman with "regular annual income" may seek protection under Chapter 12. “Regular annual income” may be seasonal as long as it is stable and regular enough to allow the debtor to make payments under a Chapter 12 plan. Debtors under Chapter 12 may be individuals (married or single), corporations, or partnerships. If you are a farmer, or rancher, in need of financial restructuring, call our firm to help you get a fresh start.