One of the most difficult decisions that you can face is whether or
not to file for bankruptcy. For individuals, there are two types of
personal bankruptcy - Chapter 7 and Chapter 13. Designed to give the
filer a fresh start in life by wiping out certain debts, a Chapter 7
bankruptcy will rid the filer of credit card and other unsecured
debt. A chapter 13 bankruptcy, on the other hand, is a court-approved
payment plan in which the filer is required to repay a predetermined
percentage of their debt. The determination of which chapter to file
will be based on the filer’s disposable income, if any, after
paying their necessary monthly bills.
When many people
file for bankruptcy, their first thoughts are of their assets and
whether or not they may lose their home. In a Chapter 13 repayment
plan, the majority of filers are allowed to keep their property in
exchange for repaying a portion of their debts. A Chapter 7, however,
is designed to be a liquidation process that often results in the
sale of non-exempt property. Which property is non-exempt in a
bankruptcy proceeding? Each state has it’s own laws pertaining to
the amount of property that an individual or married couple can keep
without having to worry about it being liquidated.
The
official bankruptcy process begins upon filing a petition with the
local bankruptcy court. This can either be done without an attorney,
also known as pro se, or with the help of an attorney. For most,
hiring an attorney is the best way to make sure that every form is
completed accurately and in order to make sure their assets are
protected as much as possible. Upon the filing of a bankruptcy
petition, the court will assign a trustee to the case and will set a
date for a Meeting of the Creditors. Although creditors of the filer
are invited to attend, they are not required to do so. The filer,
however, is required to attend and will be questioned by the trustee,
under oath, while having the meeting recorded. This meeting is
typically the only appearance required of the filer unless special
circumstances are present.
Following the Meeting of the
Creditors, often referred to as the 341 meeting, the creditors will
have 30 days to object to the filers property exemptions and another
30 days to object to the discharge if the filing is a Chapter 7
bankruptcy. In a Chapter 13 proceeding, creditors may object to the
payment plan but the discharge will not be granted until the payment
plan is complete. A Chapter 13 bankruptcy can last for up to 5 years
before the payments are completed and a discharge is issued.
Following the discharge, the bankruptcy case will be closed and the
process will be complete.
Call me today, or email me at debtfreedetroit@gmail.com 1-313-343-9930
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