Bankruptcy Overview
Many families are working hard and struggling to stay afloat due to the tough economic times. You or someone you many know many have been affected by being laid off from their job or had their hours of work reduced. Bankruptcy allows such individuals to start fresh. Due to unforeseen medical bills, divorce, even a death in the family, you might find yourself in this situation. Although no one wants to confront filing for bankruptcy, it is unfortunate that today more and more individuals are having to do so. If you are in such a position, you need an experienced bankruptcy attorney to direct you through the process and get you back on your feet. At the Law Offices of Alon Darvish, our attorneys provides the guidance needed when making this important decision. You do have choices that will better your situation, and our attorneys are here to assist you make the right decision
CHAPTER 7 – Chapter 7 is designed for debtors in financial difficulty who do not have the ability to pay their existing debts. You may claim certain of your property exempt under governing law. The trustee may then liquidate the non-exempt property as necessary and uses the proceeds to pay your creditors according to priorities of the Bankruptcy Code.
The purpose of filing a Chapter 7 case is to obtain a discharge of your existing debts. If, however, you are found to have committed certain kinds of improper conduct described in the Bankruptcy Code, your discharge may be denied by the court, and the purpose for which you filed the bankruptcy petition will be defeated.
Even if you receive a discharge, there are some debts that are not discharged under the law.
Therefore, you may still be responsible for such debts as certain taxes and student loans, alimony and support payments, criminal restitution, and debts for death or personal injury caused by driving while intoxicated from alcohol or drugs.
Under certain circumstances you may keep property that you have purchased subject to a valid security interest. Your attorney can explain the options that are available to you.
CHAPTER 11 – This is the reorganization chapter most commonly used by businesses, but it is also available to individuals. Creditors vote on whether to accept or reject a plan, which also must be approved by the Court. While the debtor normally remains in control of the assets, the Court can order the appointment of a trustee to take possession and control of the business.
CHAPTER 12 – This chapter offers bankruptcy relief to those who qualify as family farmers. Family farmers must propose a plan to repay their creditors during a three to five year period. This plan must be approved by the Court. Plan payments are made through the Chapter 12 Trustee, who also monitors the debtors’ farming operation while the plan is pending.
CHAPTER 13 – Chapter 13 is designed for individuals with regular income who are temporarily unable to pay their debts but would like to pay them in installments over a period of time. You are only eligible for Chapter 13 if your debts do not exceed certain dollar amounts set forth in the Bankruptcy Code.
Under Chapter 13 you must file a plan with the court to repay your creditors all or part of the money that you owe them, using your future earnings. Usually, the period of time allowed by the court to repay your debts is three years, but no more than five years. Your plan must be approved by the court before it can take effect. This approval is called confirmation.
Under Chapter 13, unlike Chapter 7, you may propose a plan to keep all of your property, both exempt and non-exempt.
After completion of payments under your plan, most of your debts are discharged except alimony and support payments, student loans, certain debts including criminal fines and restitution and debts for death or personal injury caused by driving while intoxicated from alcohol or drugs, and long-term secured obligations( e.g., mortgages).
It is up to you, the Debtor, to decide which option best suits your needs. There are certain requirements which must be met under each Chapter and it is important that you disclose all relevant information concerning your financial affairs to your attorney in order to ensure that you make the choice that will best work for you.
Contact the Law Offices of Alon Darvish for the most aggressive, efficient bankruptcy representation today!
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