Personal bankruptcy is a legal process that gives people with large amounts of debts a fresh start financially. There are 5 types of Bankruptcy St. Charles MO options under the Bankruptcy Code. However, for most consumers there are only two practical options, these are chapter 7 and 13 bankruptcy. Click here for more information.
Chapter 7 Bankruptcy
Chapter 7 is also known as Liquidation, which is a court-supervised procedure. During this time, a court-appointed trustee is placed in charge of the assets in the debtor’s estate. They then convert them into cash and distribute them to the creditors. This is done within the debtor’s right to retain exempted property. However, there is usually little or no nonexempt property in chapter 7. Due to this fact, it is called a no-asset bankruptcy procedure.
In nearly all chapter 7 cases, the debtor will be given a discharge that releases them of liability for almost all dischargeable debt. The process usually takes a few months from the time the petition is filed.
Chapter 13 Bankruptcy
Chapter 13 is called an adjustment of debts of an individual with regular income. Chapter 13 is used for those debtors with regular income or full-time employment. Many people opt for chapter 13 as it allows the borrower to keep some of their assets. This chapter allows the debtor be able to pay back the creditors over a longer period. This proposal is made during a confirmation hearing in a courtroom; during the hearing, the court will either approve or reject a debtor’s repayment plan. The approval will largely depend on whether the plan meets the Bankruptcy Code requirements.
In most cases, the debtor can keep control of their possessions and property. Chapter 13 states that a debtor must complete their repayment plan before they are given a discharge. The benefits of chapter 13 bankruptcies are that the debtor is protected from garnishments, lawsuits and other actions from the creditor while the plan is undertaken.
It is important to remember that not all debts are dischargeable under Bankruptcy Services St. Charles MO. The dischargeable debts will vary under individual chapter of the Bankruptcy Code. The most common types of non-dischargeable debts are mainly tax claims, debts not presented while filing for bankruptcy, and child support debts among others.
If you need filing for Bankruptcy or want more information about your options, contact the Law Offices of Steven K. Brown St. Charles MO. They offer very competent legal representation.