Last updated 5 months ago
Bankruptcy is designed to provide honest individuals with a fresh financial start by eliminating many of their debts through the process of liquidation or debt repayment. However, filing for bankruptcy can be difficult when you’re unfamiliar with the terminology. This article will discuss some of the terms commonly associated with bankruptcy law.
Bankruptcy
Bankruptcy itself refers to a federal court process which allows both consumers and businesses to eliminate or repay their debts. However, there are many different chapters of bankruptcy. For example, individuals or consumers may file for either Chapter 7 Bankruptcy or Chapter 13 Bankruptcy, while businesses may take advantage of Chapter 11 or Chapter 15 Bankruptcy.
Dischargeable Debts
Dischargeable debts are those that can be wiped out after filing for liquidation bankruptcy or completing the Chapter 13 repayment plan. While there are certain exceptions, common dischargeable debts include credit cards, unsecured loans, car repossessions, mortgage bills, medical bills, unpaid utility bills, and foreclosure balances.
Exempt Assets
Exempt property may be kept even after filing for Chapter 7 Bankruptcy. Exempt assets include motor vehicles up to a certain value, necessary clothing and household goods, jewelry up to a certain value, pension plans, a portion of home equity, and a portion of unpaid but earned wages. With Chapter 7, the debtor is also not at risk for losing their public benefits such as public assistance, social security, or unemployment.
Non-Exempt Assets
Non-exempt assets are those that are usually liquidated in Chapter 7 Bankruptcy, such as bank accounts, stocks, bonds, second vehicles or homes, expensive collectables, and family heirlooms.
Repossession
Repossession occurs when a creditor or lender takes back the collateral on a secured debt, such as a vehicle when the car loan has not been paid.
Foreclosure
Foreclosure is a legal process in which the lender has the right to sell your home in order to gain compensation for unpaid mortgage debts.
Get all of the facts before you file for bankruptcy by contacting your Schaumburg bankruptcy law firm. To learn more, call the bankruptcy lawyers with Cutler & Associates, Ltd. at (847) 868-2265 today.
Last updated 5 months ago
Making the decision to file for bankruptcy is a good first step—but filing on your own can actually hurt your case in the long run and make financial matters worse. In this video, we take a closer look at filing for bankruptcy as an individual or consumer.
One of the most important things to do when considering bankruptcy is to consult with a bankruptcy attorney. A qualified attorney will gather your paycheck stubs, tax returns, a list of personal and real assets, income, expenses, and the names and addresses of your creditors so that this can be compiled into a petition. Learn more about filling the petition and attending the trustee hearing by watching this clip.
You can find out whether bankruptcy is the right decision for your current and future financial circumstances by contacting your Aurora bankruptcy law firm, Cutler & Associates, Ltd., today at (847) 868-2265.
Last updated 6 months ago
Chapter 13 Bankruptcy and Chapter 7 Bankruptcy are the two petitions available to individual debtors. While Chapter 7 Bankruptcy allows you to liquidate your assets in order to satisfy your debts, Chapter 13 Bankruptcy is designed to allow you to repay all or a portion of your debts through a repayment plan. Individuals with stable income, unsecured and secured debts, and a large amount of non-exempt property are typically better suited for Chapter 13 Bankruptcy. Continue reading to learn what you can expect after you declare bankruptcy with the federal court.
Halting Collections and Foreclosure Proceedings
Filing for bankruptcy immediately places an automatic stay on all of your accounts. This stay not only notifies your creditors that they must cease all collection activities, but also puts a halt to repossessions and foreclosure proceedings.
Making Payments
Once your request for Chapter 13 Bankruptcy has been approved by the Federal Bankruptcy Court, the amount of your debt repayment plan will be determined based on your regular and disposable income. However, most repayment plans span between three and five years. You will then shortly begin making payments to a Chapter 13 trustee who will disburse the money to your creditors.
Discharge of Debt
You will be released of liability for dischargeable debts once you have completed the terms of your repayment plan. You will also be required to attend money management classes before your liability will be eliminated.
Rebuilding Your Credit
There are several ways in which you can begin rebuilding your credit after filing for Chapter 13 Bankruptcy. These include obtaining a secured credit card, unsecured card, gas credit card, credit union card, or by obtaining secured or unsecured loans.
Find out if filing for Chapter 13 Bankruptcy is right for you by contacting the bankruptcy attorneys with Cutler & Associates, Ltd. at (847) 868-2265. You can also learn more about filing for bankruptcy with our bankruptcy lawyers by visiting us on the Web.
Last updated 6 months ago
Many people hear the term bankruptcy and automatically think of financial ruin. However, filing for bankruptcy won’t necessarily cripple your financial future, but rather serves to help eliminate many of your current financial obligations. Are you not sure filing for bankruptcy is the right decision? Find out why bankruptcy is more beneficial than turning to a debt management solution with this informative article.
Eliminates a Number of Debts
The problem with many debt management solutions is that they do not eliminate the debts themselves, but rather force you to make changes to your spending and budgeting habits—something that may prove extremely ineffective if your spending habits were what got you into trouble in the first place. Credit counseling, for example, provides individuals with tips and tools to help get their finances back on track but does not actually result in the discharge of any debts.
Fewer Requirements
You must meet certain criteria in order to file for bankruptcy, including completing a financial management course, filing a petition to the federal bankruptcy court, having insufficient income to pay off debts, and having adequate non-exempt assets. Someone interested in credit card debt consolidation, however, must go through a number of hassles. You will need to have an extremely good credit score in order to qualify for debt consolidation, and your large debt loans will require collateral. In addition, there are a number of debt management scams currently being promoted across the country, increasing the risk of providing valuable credit information to individuals who are not actually interested in providing financial security.
Don’t ignore the option of bankruptcy just because you’ve gotten some outdated information. Learn more about the benefits of filing for bankruptcy rather than pursing debt management by calling a bankruptcy lawyer. Contact Cutler & Associates, Ltd. at (847) 868-2265 for more information on our practice areas and eight convenient Illinois locations.
Last updated 6 months ago
Despite the importance of one’s credit history and the growing risk of identity theft, many individuals fail to keep track of their credit score. As a result, they often suffer a number of financial consequences.
It’s no surprise that a higher credit score opens the door to lower rates on credit cards. However, your credit score actually impacts a number of other aspects, such as your ability to get a mortgage or home loan, your homeowners insurance rates, and even your appeal to potential employers. Learn what constitutes a low credit score and what you can do about it in this video.
Do you need help rebuilding your credit? Learn how bankruptcy can eliminate a number of debts including credit card debts by contacting the bankruptcy attorneys with Cutler & Associates, Ltd. in Aurora at (847) 868-2265.
