Bankruptcy Basics

by | Nov 22, 2012 | Lawyers

Financial problems can cause a lot of stress and anxiety. If you have debts that you cannot afford to pay there is way to get help. Filing for bankruptcy may be a good option for you. Bankruptcy may seem like a bad word, but it is actually word that can bring a lot of hope to those who are struggling financially and see no way out. Bankruptcy attorneys in Mesa AZ can help you know if filing for bankruptcy is right for you. Following are some basics you may need to know when making the decision to file for bankruptcy.

There are four types of bankruptcy. Chapter 7 and Chapter 13 bankruptcy are for those who are filing as individuals. Chapter 7 bankruptcy allows you to get rid of all of your debt or most of it. In Chapter 7 you are required to sell any assets that you may have to pay off the debts you owe. Any debt that is leftover is forgiven. Of course, you will need to rebuild your credit, but that can happen over time. Chapter 13 bankruptcy is another option for individuals wanting to file for bankruptcy. In Chapter 13 you set up a payment plan to pay off your debt to your creditors within a certain time period, usually three to five years. Generally, the amount of debt you will pay off in this time is lower than the debt you actually have. As long as you stick to your payment plan, whatever debt you have left over after five years is forgiven. Filing for Chapter 13 bankruptcy is appealing to individuals because it allows them to keep their home. Chapter 11 bankruptcy is for businesses and corporations. It is comparable to filing for Chapter 13 except that the guidelines are somewhat different. When filing for bankruptcy a business can still continue functioning but the business will have to come up with a plan for getting its financial business into order. The business will pay off debts over a period of time. Chapter 12 bankruptcy is similar to Chapter 11 but it is for farmers who are struggling financially. The farmers do not need to come up with a business plan. Bankruptcy attorneys in Mesa AZ can help you decide which type of bankruptcy is best for your situation.

The filing process for bankruptcy is fairly straightforward and is the same for each type of bankruptcy. Your bankruptcy attorneys in Mesa AZ will guide you through the process and help you navigate the legal system. Once everything is filed, there is a Meeting of Creditors where the individual or corporation filing and the creditors meet. When all the terms have been agreed to and decisions on payment plans and such have been made, the case is discharged. Once the case is discharged (generally three to five years after filing for Chapter 13, 11, and 12 bankruptcies and a matter of weeks for Chapter 7) the individual or corporation is able to start creating a new financial future.

Bankruptcy Attorneys Mesa AZ – Are you considering filing for bankruptcy? Bankruptcy attorneys in Mesa AZ can help you. Set up an initial consultation with one of the many bankruptcy attorneys in Mesa AZ today!

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