When financial problems build-up, the only relief a person might have is bankruptcy. While in the past people used to look down on those filing for personal bankruptcy, today the economy causes more and more people to file, unveiling a gracious aspect to bankruptcy never before revealed. If you need to file for bankruptcy, then you should know that you’ll find two main varieties of bankruptcy: liquidation and reorganization.
Liquidation falls under Chapter 7 of the bankruptcy laws and can be filed for by an individual or a company. After filing, the court names a trustee for your case, and that trustee has the ability to sell your personal property and pay creditors using the profits. Creditors are paid in order of priority, and any left over debt is then cancelled.
Reorganization, however, is quite different. This system is put in place when a debtor is still receiving regular monthly income, income that could be turned into creditor payments. A trustee is always appointed in these cases and given the job of establishing creditor payments based on income and expenses. While multiple chapters of bankruptcy allow for reorganization, chapters 11 and 13 are the most commonly seen.
Keep in mind, there are even more specific procedures and regulations on the subject of your bankruptcy. Since this matter is so complex, it’s recommend that a debtor hire a bankruptcy lawyer before filing. Great bankruptcy attorneys can guide you through the process and help you get out of debt.
We are experts in consumer debt law; providing affordable debt solutions to clients in the San Fernando Valley and surrounding areas. Our friendly and understanding attorney, Hale Andrew Antico, will help you get a fresh start. With a focus on trying to avoid foreclosure whenever possible and clearly explaining the bankruptcy process in plain english, you will feel much better after your first meeting with our attorney.
About the Author:
Brenner Keehgan discovered quickly that going through a foreclosure without a Pasadena bankruptcy attorneys can be tough, which is why he chose to visit Burbank Bankruptcy help online for more information.