 GENERAL
OVERVIEW
ABOUT BANKRUPTCY
Bankruptcy
is a federal law designed to protect individuals who have encountered
financial difficulty. The filing of a bankruptcy offers immediate
relief to a debtor, by prohibiting all collection attempts. Activities
prohibited by the Bankruptcy Code include phone calls and letters
designed to collect a debt, as well as lawsuits, garnishments, repossessions
and foreclosures. All creditor contact must cease immediately upon
the filing of a petition for bankruptcy, subject to certain exceptions
in a small number of cases.
Depending upon the type of bankruptcy which is filed, debts may
be eliminated entirely, or reorganized and repaid over time through
a court supervised repayment plan. The type of bankruptcy which
is best for a particular client will depend upon their particular
circumstances, and the goals which they seek to achieve. Leiden
and Leiden offers a free bankruptcy consultation to review the client’s
financial situation and propose a debt relief solution.
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CHAPTER 7
Chapter 7 bankruptcy provides for the elimination of unsecured
debts, such as credit card debt, medical bills and deficiency claims.
Consumers who file a Chapter 7 bankruptcy are also provided the
opportunity to retain secured debts, such as a house mortgage, car
payment, or furniture payment. Every state has exemptions which
allow debtors to retain property, despite the filing of a bankruptcy.
The elimination of your unsecured debt in a Chapter 7 bankruptcy
case is designed to provide the consumer with a fresh start, without
the burden of unsecured debts beyond their ability to repay.
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CHAPTER 13
A Chapter 13 bankruptcy or wage-earner plan, is a Bankruptcy Court
supervised repayment plan which allows for Debtors to reorganize
their debts based on their ability to repay. A Chapter 13 bankruptcy
will prevent foreclosure of real estate and repossession of automobiles,
and provide the consumer with a method of repaying these debts over
time. A Chapter 13 plan also allows consumers to repay certain debts,
such as car payment or furniture payment, based on the value of
the collateral, rather than the balance owed. A Chapter 13 plan
may also provide for the payment of certain debts which cannot be
eliminated in a Chapter 7 bankruptcy, such as taxes or student loans.
It also provides for the elimination or reduction of interest in
many debts. A Chapter 13 plan may also be used to protect assets
which would be at risk in a Chapter bankruptcy. There are also certain
situations in which a consumer may be required to file a Chapter.
The typical Chapter 13 plan can last for no more than five years.
The term of the case may vary depending upon the amount of income
that a person has, and the types of debt which they owe. In order
for an individual to be eligible to file a Chapter 13 bankruptcy,
they must have a verifiable source of income. The individual’s
income may come from a variety of sources, including wages, social
security, retirement income, or other sources.
Download
Consumer Bankruptcy Intake Form
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Reader)
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CREDIT REPORTS
If you believe that you will be unable to provide our office with
up-to-date information, you may wish to consider downloading a copy
of your free annual credit report from www.annualcreditreport.com.
You are entitled to one free credit report per year from the participating
credit reporting agencies. For security purposes, we would recommend
that you do not permit anyone else to utilize the www.annualcreditreport.com
website to obtain the information on your behalf.
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