What is Bankruptcy

What is Bankruptcy | Andres Montejo Law

Bankruptcy is a legal process in which individuals, couples, or businesses can no longer pay for debts and may be excused from paying their debt to creditors. This process is covered by the federal law. There are two types of bankruptcy. Chapter 7, a liquidation bankruptcy, where debtors must give up their property and Chapter 13, a reorganization bankruptcy where debtors are allowed to keep their property, but must provide payments in installments to creditors. You will be required to submit a petition and fee to the court which includes information on the debtor’s income, expenses, debts, and property.

The bankruptcy process:

The first step is to assure that bankruptcy is the best option for you. If it is, we will determine which type would be for you.

Then, we will ask you to bring information about income, expenses, debts and property. Then we will need to sign the documents and we will file them with the court.

As soon as we file, you will have immediate relief from creditors under an automatic stay. The automatic stay prevents creditors from going after debtors for money that may be owed. You may sue a creditor, If you have filed for bankruptcy and a creditor continue to contact you. Instead, they must speak to your bankruptcy attorney.

You will be assigned a competent bankruptcy trustee to manage the case, meet with this trustee after a few weeks, and the court will issue an order of discharge. The order of discharge releases the debtor from legally being required to pay any debts that are discharged meaning the debtor no longer has personal liability for those debts.

You will be required to take a debtor education course after filing for bankruptcy and before the discharge.

South Florida Bankruptcy Law Center of Andres Montejo

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