Memphis, TN Bankruptcy Lawyer
Filing bankruptcy can be very scary, and because it is not something, everyone does every day, you might be wondering if you need a bankruptcy lawyer. A Memphis, TN bankruptcy lawyer is going to be able to walk you through the process of bankruptcy law, and you are correct in asking how you know if you need a lawyer or not.
What Is Bankruptcy?
Bankruptcy law is a law that allows debtors who are unable or partially unable to pay their outstanding debts to get rid of those debts and attempt to start over fresh. The US Supreme Court states that bankruptcy gives “the honest but unfortunate debtor a new opportunity in life.” There are many types of bankruptcies, and a bankruptcy lawyer is going to be able to advise you on what one bankruptcy is best for you.
What Are the Different Types of Bankruptcy?
Bankruptcy code provides for six different types of bankruptcy, which are known by the chapter in the code in which it is located. These codes differ in form and procedure, they do all offer permanent relief from debt.
- Chapter 7 bankruptcy code provides for liquidation of nonexempt assets. Certain assets such as a home or car can be exempt from this type of bankruptcy. A court-appointed trustee is going to conduct a cell of your nonexempt assets and distribute the proceeds to your creditors. Both individuals and businesses can file for bankruptcy under Chapter 7.
- Chapter 9 provides for the reorganization of municipalities, such as cities, towns, villages, taxing districts, municipal utilities and school districts.
- Chapter 11 is often relied on by partnerships and corporations more than the individual. This is because Chapter 11 bankruptcy provides a supervised reorganization of the business and allows the debtor to maintain the business while they implement a payment plan which is confirmed by the court.
- Chapter 12 contains bankruptcy provisions that are applicable to farmers and fishermen and therefore would not be used for anyone who is not a farmer or fisherman.
- Chapter 13 provides for bankruptcy of an individual with a regular income which is used to make a patent payment plan to pay debts. Typically, these payment plans follow 3 to 5 years of payments in which you finish paying all of your debts off.
- Chapter 15 applies to cross-border bankruptcies.
Because these chapters can be hard to understand unless you are a bankruptcy lawyer with experience, you should really consider getting a lawyer to deal with your bankruptcy needs. By doing this, it allows you to go through the bankruptcy process filing the correct chapter of bankruptcy and doing everything correctly said that it’s a smooth process.
What Is the Difference Between Chapter 7 and Chapter 13 Bankruptcy?
The goal of both chapter 7 and chapter 13 bankruptcy is to discharge her guidance. However, the differences lie in the eligibility requirements, the length of time the bankruptcy chapters take, whether you need to repay your debts, and how much property you make. In chapter 7 bankruptcy you do not need to commit to paying your debts. But in chapter 13 bankruptcy you must file a debt repayment plan with the bankruptcy court.
Repaying debts in chapter 13 occurs over a 3 to 5-year period and you have to have income sufficient to make full and timely payments. You won’t receive a discharge of your debt completely until you complete your payment plan. As long as you account for a payment of any debts you will not lose your property
In chapter 7 bankruptcy a trustee can take the property you owe that is not exempt from collection, sell it and redistribute the proceeds to your creditors so that they are repaid. Exemptions vary from state to state but usually you are able to keep some or all of the equity in your home, car, and personal property. Only those who pass a means test may file for Chapter 7 bankruptcy and typically after filing excessively your debts are likely to be discharged within 4 to 6 months.
Is There a Certain Amount of Debt to Qualify to File for Bankruptcy?
There is no minimum amount of debt to qualify for bankruptcy. Certain debt limits apply to the Chapter 13 bankruptcy, such as the maximum amount of secured debt such as a mortgage, or a maximum now and unsecured debt. There will going to be limits on how many times you can have your debts discharged via bankruptcy. If your debts are relatively low, you need to consider alternatives to bankruptcy so that if you file in the future, you still have the option.