The decision to file bankruptcy is never an easy one; there are as many circumstances which may lead to the need to file bankruptcy as there are persons who may need assistance in this area of the law.

 In bankruptcy, the bankruptcy code is divided into various chapters. Chapter 7 is designed for debtors in financial difficulty we do not have the ability to pay their existing debt. Debtors who’s debts are primarily consumer dates are subject to a “means test” designed to determine whether the case should be permitted to proceed under Chapter 7. Under Chapter 7, you may claim certain of your property is exempt under covering law. The purpose of filing a Chapter 7 cases to obtain a discharge of your existing debt.

Chapter 13 of the bankruptcy code is designed for individuals with regular income who would like to pay all or part of their debts in installments over time.  Essentially a payment plan or repayment plan is prepared, submitted to the court, and once approved governs the repayment of your debts. A chapter 13 bankruptcy generally is either three years or five years in length. Sometimes a person must file a Chapter 13 bankruptcy if they do not other otherwise qualify for a Chapter 7 bankruptcy, but need relief in the immediate future, for example to retain possession of the house they may be purchasing, but who’s payments have gotten behind.

In either a Chapter 7 or 13 bankruptcy, certain debts are not dischargeable. These include most back taxes, child support, and restitution in a criminal case.

To explore whether you might qualify for a Chapter 7 or 13 bankruptcy, to learn more about the types of debts which may not be discharged, and to decide whether bankruptcy is an an option you need or desire to pursue, call the number above for a free consultation.