Which Chapter of Bankruptcy Should I File?
If you’re thinking about filing bankruptcy, there are two types that you will need to consider. The first type is Chapter 7 bankruptcy and the second is Chapter 13 Bankruptcy. Which type of bankruptcy you file will be determined by a number of factors, such as the value of assets and your ability to pay at least some of the debt.
At Ursulova Law Offices, we will look at your situation and help you determine which type is the best for your situation. In other words, you will receive guidance from experienced Brooklyn NY bankruptcy lawyers that want to see you successfully start again on solid financial footing.
Is Chapter 7 Bankruptcy Right for You?
Chapter 7 bankruptcy is also called “liquidation bankruptcy” because non-exempt property can be sold by a bankruptcy trustee in order to repay creditors. If all of the debtor’s property is exempt, then none will have to be sold to satisfy debts. Most Chapter 7 filers are able to keep all or most of their property.
High-income earners aren’t typically eligible to file Chapter 7, but they can file Chapter 13 bankruptcy. With the guidance of a bankruptcy law firm in Brighton Beach, you will be fully educated on which of your assets are exempt and which aren’t.
Is Chapter 13 Bankruptcy Right for You?
To determine the type of bankruptcy you should file, a means test is performed. Those that pass the means test usually file Chapter 7. Those that don’t file Chapter 13.
To file Chapter 13 bankruptcy, you must have regular income to establish a repayment plan. There are no income requirements, but unsecured debt and secured debt have limits. These limits are always subject to change, but our Brooklyn NY bankruptcy lawyers will have the most recent numbers on hand.
What are Chapter 11 and Chapter 12 Bankruptcy?
Chapter 7 and Chapter 13 are the most common types of consumer bankruptcy, but Chapter 11 and Chapter 12 exist for certain debtors. Large businesses usually use Chapter 11 to reorganize their debts. Farmers and fishermen might use Chapter 12 to establish payment plans that offer more flexibility than Chapter 13 bankruptcy. Chapter 12 also has higher debt limits.
How to Choose the Right Type of Bankruptcy
Ursulova Law Offices will review all of your options with you. Examples of people that file Chapter 7 include unemployed homeowners with few assets or some equity, employed homeowners facing foreclosure, non-homeowners with a significant amount of debt, or non-homeowners with assets. Some examples of people that file Chapter 13 include unemployed homeowners with a significant amount of equity, debtors with significant assets they wish to protect, and debtors that make above the state’s median income that have significant debt. If a petitioner is wealthy with a lot of debt, Chapter 11 might be more appropriate since Chapter 13 caps debt amounts.
Regardless of your situation, our bankruptcy law firm in Brighton Beach will help you get on the right path to a healthier financial future. This is a complicated process that will operate smoother with the help of an experienced attorney.
