The legal code that governs this course of action does not require an individual or business to retain a bankruptcy attorney; however, the Code is extremely difficult and contains numerous nuances that an untrained individual may find overwhelming, complicated, and even tedious. In addition, it is prudent to bring a bankruptcy attorney with you to the Creditors' Meeting. At this meeting, a court-appointed trustee will ask the debtor confidential questions about his or her finances, and a lawyer can advise you on the best way to respond.
While there are numerous chapters within the code, Chapter 7, Chapter 11 and Chapter 13 are the most frequently used. The chapter you may be eligible to file depends on a number of factors, including whether you are filing as an individual or a business, whether you wish to eliminate or reorganize your debt, and whether you have the means to repay your creditors. A lawyer can assist the debtor in determining the answers to these questions and then assist them in filing the most appropriate chapter of bankruptcy.
Chapters 13 and 7 are the most prevalent options for eliminating or reorganizing debt. Chapter 13 is intended for businesses owned by a sole proprietor, but it can be filed by an individual if certain requirements are met. It is advantageous for the debtor because they can keep their business by consenting to a reorganization plan. The highlight of this arrangement for the debtor is that they can stop foreclosure proceedings and may even be able to resolve mortgage default proceedings due to missed payments. Typically, Chapter 13 requires the debtor to repay all or a portion of their debt over a period of three to five years.
Many people believe that filing for Chapter 13 bankruptcy is a black mark on their reputation, but life does happen. They may find themselves in a dire financial situation due to unexpected medical expenses, family emergencies, or job loss, and the only option available to them is to file for bankruptcy in order to start their lives over. There is no dishonor in this course of action; however, in order to obtain the best results in such a life-altering endeavor, obtaining the services of a reputable bankruptcy attorney who will guide one through the process is the first step toward financial freedom.
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