What The Basics Of Bankruptcy Are

Filing for bankruptcy doesn't have to be difficult. It's a good idea to have an attorney guide you through the process and to make sure you do things correctly. You will get all the answers to your major questions from a lawyer. Bankruptcy attorney Benjamin J. Ginter runs the Law Offices of Benjamin J. Ginter in Cranford, New Jersey. Here, he discusses what the basics of bankruptcy are and why you need an experienced lawyer.

Consumer bankruptcy allows people to either eliminate or wipe out most of their debt, in some circumstances, to repay their creditors under a court supervised repayment plan. The eventual goal of any type of bankruptcy filing is almost always to obtain a discharge from the court, which means that all the consumers' debts (with some exceptions) which exist before the filing are eliminated.

With few exceptions, any person or business owing money to a creditor can file for a bankruptcy petition.

Consumers typically file Chapter 13 bankruptcy, where repayment is made to creditors; or a Chapter 7, where most debts are eliminated. For the majority of consumers, a Chapter 7 would be filed; usually a Chapter 13 is filed by those who face losing their home in a foreclosure.

Some people do have a simple case that they could possibly do on their own. But it's a good idea to have an attorney guide you through the process and make sure you do things correctly. A lawyer can guide you through the intricacies of the process and help you avoid the pitfalls. Although you may think your case is easy, if you file incorrectly, it can significantly delay your discharge, and in some cases, your case could be dismissed. Moreover, if you file for the wrong bankruptcy chapter, you could put yourself in jeopardy of losing assets, including your home.

A Chapter 7 bankruptcy can be filed every 8 years from a previous chapter 7 filing or 6 years from a prior chapter 13 filing. Chapter 13 can be filed 4 years from a prior Chapter 7 filing or 2 years from a prior Chapter 13 filing. Filing bankruptcy can adversely affect your ability to obtain future credit, rent housing and even negatively impact a job application, so it's important to consider these things as you decide whether to file.

No. The debts that cannot be discharged vary slightly between the different chapters of bankruptcy. Generally, student loans, recent income taxes, child support and other marital obligations, and items having to do with fraud are not dischargeable.

It depends on different factors: where you live, how much equity you have in the property, how far you are behind in the mortgage payments, etc. If you have a home or own any kind of real estate, it's more important than ever that you hire a bankruptcy attorney. Filing the wrong bankruptcy could jeopardize your home.

Exemptions allow an individual to exempt or keep certain kinds of property. Most people who wish to file bankruptcy are unlikely to have a great deal of money or property stashed away. It is likely that unless you own a valuable car that's paid off, a house with a lot of equity, a valuable inheritance, or some other kind of unusually valuable property, you will be able to keep everything you own as "exempt."

No. Although at your option, you can file an explanation with the credit reporting agencies briefly describing the events resulting in your bankruptcy. If an account is reported inaccurately, you can request that the record be updated to reflect the actual situation.

10. Can you get credit cards after you file for bankruptcy?

Yes. You might even start receiving offers in the mail right after you file your case. However, these credit cards usually carry high interest rates and fees. They put money in your bank's pocket, not in yours. If you want the convenience of a credit card, you can have one with a small limit.

11. Is filing for bankruptcy immoral or bad?

No, the bankruptcy law is in place because our system of law recognizes that your life and future should not be ruined because of some financial mistakes you've made. You should never feel ashamed or feel like a failure if you decide to file for bankruptcy. Hold your head up high and remember that bankruptcy can give you a fresh start.

Can You Still Qualify For Chapter 7 Bankruptcy?

A lot of people are under the misconception that they no longer qualify for bankruptcy because of the changed laws. Bankruptcy attorney Benjamin Ginter runs the Law Offices of Benjamin J. Ginter in Cranford, New Jersey. Here, he says bankruptcy is still a viable option for many individuals although the bankruptcy laws have changed.

Filing for bankruptcy should not be considered an end, but a new beginning. You will have the opportunity to rebuild your credit and can even apply for car loans or home mortgages soon after filing. The procedure of filing can be complicated, but it will be successful if it is done correctly. A qualified and experienced bankruptcy attorney can help you every step of the way.

Filing For Chapter 7 Bankruptcy

It is still possible to file for Chapter 7 bankruptcy, although some of the main areas have changed. For example, you can now file for Chapter 7 bankruptcy once every eight years instead of every six years. Under the bankruptcy law, certain property is exempt. Often when you file for Chapter 7 bankruptcy, you are able to keep your property because of the exemptions.

Now you will face a means test and need a medium-income level to file for bankruptcy. Each state has set its own rules of medium-income level for a family of a certain size. Here in New Jersey, for example, if you have a household of four people, including children, the medium-income level has been determined to be roughly $103,000.

If you and your spouse make more than $103,000, you could not file for Chapter 7 bankruptcy. As based on your combined income, you could afford to file for Chapter 13 bankruptcy, which means you can make regular payments. However, a lot of people do not make the kind of income that would exceed this level, so they can still file for a Chapter 7.

Making Deductions

If you are required to file for Chapter 13, you will have to show that you have expenses that prevent you from making the payments, and prove that you are correct in filing for Chapter 7.

Sometimes that is based on what you pay in mortgage payments or whether you have a car that you have to make regular payments on. You can make deductions from this and be able to file for Chapter 7, even though your income exceeds the medium-income level.

Understanding the complicated rules of filing for bankruptcy can be difficult, which is why many people seek the advice of a professional.

Bankruptcy Defined

Bankruptcy definition states that it's the law which gives a new start to those individuals who are unable to pay off their debts due to the circumstantial financial stringency by liquidating their assets to pay off their outstanding debts. On some occasions even a repayment plan is created. Bankruptcy laws also provide assistance to troubled businesses and offers orderly distributions to their creditors by the process of reorganization or liquidation.

You would obtain much information pertaining to bankruptcy on net, but the relevance of this bankruptcy info should be checked before completely relying upon it. When we speak about our US Fed laws, bankruptcy is generally of six types, which are namely Chapter 7, 9,11,12,12,and 15. Among these the most common types used frequently are chapter 7 and chapter 13. Statistics reveal that more than 65% of the filings are under chapter 7. Mostly all the corporate or businesses file for chapter 7 bankruptcy. Followed by these two in rank is the chapter 11 bankruptcy. As per the Fed Laws, bankruptcy cases cannot be filed in state courts and needs to be files in a federal bankruptcy court.

Individuals normally file for bankruptcy when they are left with no option to pay off their debts incurred. Though the results of it are long lasting, but in their helplessness they are forced to take this debt management option. Thought you are discharged of your debts by this, but its presence remains in your credit report for the next ten years, which could make your life ahead pretty difficult to obtain a credit, buy a home, get insurance or even in cases of getting a job!

Mostly individuals file for either the chapter 7 or chapter 13 bankruptcies. Filing for a bankruptcy also incurs costs consisting of the filing fees of few hundred dollars, and the hired attorney's fees.

Chapter7 bankruptcy generally known as the straight bankruptcy allows the individual having a consistent flow of income to keep his property like the mortgaged house or car etc, which else might have been lost under the bankruptcy process. It's the simplest and fastest. Under this chapter you would need to wait for the next eight years to file for bankruptcy again under this same chapter.

Chapter 13 bankruptcy is basically the rehabilitation payment plan for individuals with a steady source of income, and thus is also known as the wage earners bankruptcy. Here the court allows the individual to use your income to pay off your debts within the three-to-five-year span, rather than surrendering your assets. You are discharged only after you pay off all your debts. The waiting period for this is much shorter of about only two years in contrast to the 8 long years for the chapter 7 bankruptcy.

Apart from all the above mentioned bankruptcy info, both these types of chapter 7 & 13 bankruptcies frees you from unsecured debts. It also puts an end to foreclosures, repossessions, garnishments, utility shut-offs, and debt collection activities. But when bankruptcy definition is explained one thing to be kept in mind is that never erases child support, alimony, fines, taxes, & a few student loan obligations.