bankruptcy attorney

bankruptcy attorney

A bankruptcy attorney is a legal expert who specializes in assisting individuals and corporations through the complex bankruptcy procedure.

In addition to representing clients in court and negotiating a repayment plan with creditors, the attorney can aid clients in selecting which type of bankruptcy is ideal for their case.

Introduction:

Numerous individuals and organizations may find the process of declaring bankruptcy to be challenging and stressful.

The bankruptcy laws are complex and constantly evolving, making it difficult for anyone unfamiliar with the legal system to manage the process on their own.

A bankruptcy attorney may be of great assistance in this respect, assisting clients in understanding their legal rights and responsibilities and collaborating with them to build a strategy that will help them reach the best possible conclusion.

Individuals and businesses can file for a variety of bankruptcy options, each with its own criteria and advantages.

A bankruptcy attorney can assist clients in determining which sort of bankruptcy is most suitable for their particular circumstances.

Chapter 7 bankruptcy, sometimes known as “liquidation” bankruptcy, is typically filed by people with limited assets and a substantial amount of unsecured debt, such as credit card debt.

A trustee is appointed in Chapter 7 bankruptcy to monitor the case and evaluate the debtor’s assets.

The trustee will next liquidate any assets that are not exempt in order to repay creditors.

However, the majority of Chapter 7 bankruptcy filers are permitted to preserve their personal property and other exempt assets. In addition, in Chapter 7 bankruptcy, the majority of unsecured debts, such as credit card debt, medical expenses, and personal loans, are erased.

This signifies that the debtor is no longer required by law to repay the debts. Certain debts, such as school loans and taxes, cannot be discharged in Chapter 7 bankruptcy.

Chapter 11 bankruptcy, often known as “reorganization” bankruptcy, is typically utilized by firms that need to restructure their operations to achieve financial stability.

This sort of bankruptcy allows the business to continue operations while developing a repayment plan for its creditors.

In Chapter 11 bankruptcy, the company will draft a reorganization plan outlining how it will pay off its obligations and continue to operate.

Before the plan can be implemented, it must be approved by the court and a majority of the creditors.

Once the plan is authorized, the company can continue operations, and the court will oversee the repayment of debts in accordance with the plan.

Chapter 13 bankruptcy, commonly known as “wage earner’s” bankruptcy, is typically utilized by individuals with a steady income who wish to repay their debts over three to five years.

Individuals who have a substantial amount of secured debt, such as a mortgage or vehicle loan, and wish to maintain their assets may benefit from this sort of bankruptcy.

In Chapter 13 bankruptcy, the debtor will prepare a repayment plan outlining how they will repay their obligations over the course of three to five years.

Before the plan can be implemented, it must be approved by the court and a majority of the creditors.

Once the plan is authorized, the debtor will begin making payments to a trustee, who will subsequently distribute the monies to creditors in accordance with the plan.

A bankruptcy attorney can also advise clients on how to exempt specific assets from liquidation in a Chapter 7 bankruptcy and how to safeguard their assets in a Chapter 13 bankruptcy.

In addition, they can assist clients in identifying and valuing assets that they may be able to retain in a bankruptcy.

In addition, they can help customers comprehend the legal process of bankruptcy, the debtor’s rights and obligations, the many forms of debt and which are dischargeable and which are not, and the automatic stay that goes into force when a person files for bankruptcy.

Conclusion:

A bankruptcy attorney is a helpful resource for individuals and organizations experiencing financial troubles.

They can assist clients in comprehending the complicated rules surrounding bankruptcy, determining which type of bankruptcy is best for their situation, and negotiating a repayment plan with creditors.

It is possible for clients to achieve the best possible outcome and regain financial stability with the assistance of a bankruptcy attorney.

References:

“Chapter 7 vs. Chapter 13 Bankruptcy: What’s the Difference?,” LegalConsumer.com, accessed January 18, 2023.
“Chapter 11 Bankruptcy,” U.S. Courts, accessed January 18, 2023.
“Automatic Stay,” United States Courts, accessed January 18, 2023.